Subsidiaries are separate, distinct legal entities for the purposes of taxation, regulation and liability.

JSTOR ( July 2022) ( Learn how and when to remove this template message).Unsourced material may be challenged and removed. Please help improve this article by adding citations to reliable sources. This section needs additional citations for verification. These, and others, organize their businesses into national and functional subsidiaries, often with multiple levels of subsidiaries. Discovery, or Citigroup as well as more focused companies such as IBM, Xerox, and Microsoft. Examples of holding companies are Berkshire Hathaway, Jefferies Financial Group, The Walt Disney Company, Warner Bros. They are a common feature of modern business life, and most multinational corporations organize their operations in this way. The subsidiary can be a company (usually with limited liability) and may be a government- or state-owned enterprise. It will also maintain its own executive leadership. Two or more subsidiaries that either belong to the same parent company or having a same management being substantially controlled by same entity/group are called sister companies.The subsidiary will be required to follow the laws where it is headquartered and incorporated. Not to be confused with Subsidiarity or Subsidy.Ī subsidiary, subsidiary company or daughter company is a company owned or controlled by another company, which is called the parent company or holding company.

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