There is a very specific function for holding companies: they manage the participation of other companies on your behalf. This is useful when you have lots of business decisions to make.
What are the benefits of using this type of company?
There Will Be A Reduced Amount Of Risk For The Owners
There will be a reduced amount of risk for the owners who are involved in the company. It ensures that owners are not personally responsible if the company that they are managing comes to an end. This is one of the main reasons that people use this type of company in the first place.
This Can Allow One Person To Have A Controlling Stake In Several Businesses
These companies allow one person to have a controlling stake in several businesses.
This Can Allow One Person To Influence The Operations Of A Business
Parent companies that are set up as a Swiss holding company are going to influence the actions of the smaller companies that they own. This will allow you as a business owner to have a direct impact on the management of the company. You may take a very “hands-on” approach.
This Allows A Company To Have A Diverse Range Of Assets
A large holding company is going to have an easier time raising money than an individual company. This is because the large holding company will be able to draw on the assets of the smaller companies that it controls.
The Regulations That Apply To These Companies
- There must be one person with at least 10% of the total shares of the company.
- The investment must be equal to two-thirds of the overall company income.
The company is going to be exempt from tax if the conditions are met successfully.
What Can The Holding Companies Own?
The holding companies will be able to own a variety of different things.
They Can Own Real Estate
They can own real estate such as business buildings. These buildings can be sold on for a profit if the company needs to raise money.
They Can Own Patents
They can own patents to inventions. This means that absolutely nobody else is going to be able to copy the patents or lay claim to them.
They Can Own Trademarks
They can own trademarks of different companies. Trademarks are a name or a logo that identifies a particular company. They are extremely important.
They Can Own Stocks
Companies can buy stocks and shares in order to raise some money for the business. These stocks and shares can be sold at any time for a profit.
Conclusion Of The Article
Holding companies can be set up to take control of smaller companies. This can allow you to influence business decisions. Through the holding companies that are set up you are going to be able to own everything from stocks and shares to business property and trademarks.
These holding companies need to comply with several financial standards that you need to be aware of.