Wholly Owned Subsidiary Law and Legal Definition
A wholly-owned subsidiary is a company whose stock is entirely owned by another company. For example, American Airlines is a wholly owned subsidiary of AMR Corp. The owner of a wholly-owned subsidiary is known as the parent company or holding company. The parent company can control all the activities of the subsidiary company. In short, all of the activities of the wholly-owned subsidiary are part and parcel of the parent company for both operating and reporting purposes. However, for legal purposes, a wholly-owned subsidiary is a separate entity. Thus the laws of the state or country in which the wholly-owned subsidiary is incorporated apply to the subsidiary, but not the parent company.
Legal Definition list
Related Legal Terms
- Company Owned Outlet
- Covered Subsidiary [Banks & Banking]
- Domestically Owned Enterprise
- Economically Disadvantaged Women‐Owned Small Business [EDWOSB]
- Family Owned Businesses
- Federally Owned Housing
- Federally Owned or Administered Forest Land
- Federally Owned Property
- Financial Subsidiary
- Government Owned Invention [Patents]
