2, in addition to the share control mode, by concluding some special contracts or agreements to make a company under the control of another company, the relationship between the parent company and its subsidiaries can also be formed.
3. If the parent-subsidiary relationship is to be formed, the subsidiary must be controlled by the parent company. The so-called actual control means that the parent company has the actual decision-making power over all major matters of the subsidiary, especially the composition of the board of directors of the subsidiary.
In order to realize the actual control of another company, a company must own more than 50% of the shares of the company.
Extended data:
A subsidiary refers to a company whose shares are held by another company or actually controlled by another company through an agreement.
Although the subsidiary is controlled by the parent company, it is still an independent enterprise with legal person status in law. Have its own name and articles of association, and carry out business activities in its own name. Its property and the property of the parent company are independent of each other and each is responsible for its own debts.
Relationship between parent company and subsidiary company:
1. The subsidiary is actually controlled by the parent company.
The parent company has the actual decision-making power on major issues of its subsidiaries, can decide the composition of the board of directors of its subsidiaries, and can directly exercise the power to appoint directors of the board of directors.
2. The relationship between parent company and subsidiary company is based on the agreement of share possession or control.
Generally speaking, shareholders with more shares have greater decision-making power over company affairs. Therefore, if a company owns more than 50% of the shares of another company, it can actually control the company.
In practice, the shares of most companies are scattered, and as long as they have more than a certain proportion of shares, they can obtain a controlling position. In addition to controlling shares, a company can also control another company by concluding some special contracts or agreements.
3. The parent company and subsidiaries are independent legal persons.
Although subsidiaries are actually controlled by the parent company, restricted and managed by the parent company in many aspects, and some of them are actually similar to the branches of the parent company, legally speaking, subsidiaries belong to independent legal persons, engage in business activities in their own names and independently bear civil liabilities.
References:
Baidu encyclopedia-subsidiary
Baidu encyclopedia-parent company