1. Managers of wholly-owned subsidiaries can fully control the daily business activities of the company and concentrate on their own goals;
2. Reduce the opportunities for other competitors to gain the competitive advantage of the company;
The disadvantages of wholly-owned subsidiaries are:
1, the wholly-owned subsidiary needs more registered capital;
2. The legal risk is high.
legal ground
Article 14 of the Company Law of People's Republic of China (PRC)
Companies can set up branches. The establishment of a branch company shall apply to the company registration authority for registration and obtain a business license. A branch company does not have legal person status, and its civil liability shall be borne by the company. A company may set up subsidiaries, which have legal personality and independently bear civil liabilities according to law.
Article 57 of the Company Law of People's Republic of China (PRC)
The provisions of this section shall apply to the establishment and organization of a one-person limited liability company; Where there are no provisions in this section, the provisions in the first and second sections of this chapter shall apply. A one-person limited liability company as mentioned in this Law refers to a limited liability company with only one natural person shareholder or one corporate shareholders.