Subsidiary
From Free net encyclopedia
In business, a subsidiary is a company controlled by another company or corporation. When control or ownership is not shared, it is termed a wholly owned subsidiary. Multinational holding companies such as Berkshire Hathaway[1], Time Warner, or Citigroup usually organize all holdings into subsidiaries, sometimes with multiple levels of containment.
Subsidiaries are separate, distinct legal entities for the purposes of taxation and regulation. They are distinct from divisions, which are entities fully integrated within the main company, and not legally or otherwise distinct from it.
An operating subsidiary is a business term frequently used within the United States railroad industry. In the case of a railroad, it refers to a company that is a subsidiary but operates with its own identity, locomotives and rolling stock.
In contrast, a non-operating subsidiary would exist on paper only (i.e. stocks, bonds, articles of incorporation) and would use the identity and rolling stock of the parent company.