A parent company is a company that owns enough voting stock in another firm to control management and operation by doing and influencing or electing its board of directors. The second company is deemed a subsidiary of the parent company.
1 By country
1.1 Australia (AU)
2 See also 3 References
The parent company-subsidiary company relationship is defined by Part
1.2, Division 6, Section 46 of the
Corporations Act 2001
A body corporate (in this section called the first body ) is a subsidiary of another body corporate if, and only if:
(a) the other body:
(i) controls the composition of the first body's board; or (ii) is in a position to cast, or control the casting of, more than one-half of the maximum number of votes that might be cast at a general meeting of the first body; or (iii) holds more than one-half of the issued share capital of the first body (excluding any part of that issued share capital that carries no right to participate beyond a specified amount in a distribution of either profits or capital); or
(b) the first body is a subsidiary of a subsidiary of the other body.
Singapore The parent subsidiary company relationship is defined by Part 1, Section 5, Subsection 1 of the Companies Act, which states:
5. —(1) For the purposes of this Act, a corporation shall, subject to subsection (3), be deemed to be a subsidiary of another corporation, if —
(a) that other corporation —
(i) controls the composition of the board of directors of the first-mentioned corporation; (ii) controls more than half of the voting power of the first-mentioned corporation; or (iii) [Deleted by Act 36 of 2014 wef 01/07/2015]
(b) the first-mentioned corporation is a subsidiary of any corporation which is that other corporation's subsidiary.
Conglomerate (company) Holding company Minority interest Subsidiary
^ "CORPORATIONS ACT 2001 - SECT 46". AustLII. Retrieved 2008-05-30. ^ a b "Definition of subsidiary and holding company". Singapore Statutes Online. Retrieved