2006-11-14 22:13:10 · 6 answers · asked by Anonymous in Politics & Government ➔ Politics
For the people who have answered so far, if there are a lot of people out of pocket as a result then, in my opinion the parent company should be held liable to some degree.
2006-11-14 23:42:57 · update #1
Why should it be?
The parent company should not be responsible due to the fact that even though it is a parent company, they are still 2 different companies.
You cannot bankroll a company to keep it going just because it is a smaller company, if a company isn't making money, it's to be closed.
The parent company basically is responsible for the creation of the company, and it can use some of it's resouces to help it out, but what's the point of keeping the company if it's making a loss, must be closed.
2006-11-14 22:20:35 · answer #1 · answered by Anonymous · 0⤊ 0⤋
because the company is old enough to take care of itself.
maybe it should have asked it's parents for help, and sometimes the parent just sees that there is no hope for the company, and must let it go.
really though...i work for a company in america (NEC electronics)...parent company in japan...sister company in scotland.
unfortunately, several years ago, we (as an industry...not just NEC) hit hard times and scotland closed and we stayed afloat. all of us were hurt by the economical circumstances and i do not know why we were saved and scotland wasn't.
japan paid our way for almost two years, and thankfully things are better now. i guess they saw our potential, because we are now expanding our line.
2006-11-14 22:20:12 · answer #2 · answered by soren 6 · 0⤊ 0⤋
Why should the main company be responsible for the managing mistakes of the daughter company? This one has also a manager who has deciding powers. He is responsible for his decisions.
2006-11-14 22:21:11 · answer #3 · answered by m_kiss2010 3 · 0⤊ 0⤋
Each company is a separate entity..legally. In layman's terms it is no different than a parent not being responsible for an adult child's debt.
2006-11-14 23:18:49 · answer #4 · answered by mymadsky 6 · 0⤊ 0⤋
A "LIMITED" COMPANY STANDS FOR A LIMITED LIABILITY COMPANY. THIS MEANS THAT THE LIABILITY OF THE SHAREHOLDERS IS LIMITED TO THE AMOUNT OF MONEY THAT THEY HAVE INVESTED IN THEIR SHARES. AS THE PARENT COMPANY IS A SHAREHOLDER THEN THIS LIMITED LIABILITY APPLIES TO THEM.
I THINK THE ORIGINAL IDEA WAS TO ENCOURAGE PEOPLE TO INVEST KNOWING THAT THE MOST THEY COULD LOSE WAS THE ACTUAL AMOUNT THEY HAD INVESTED AND IF THINGS WENT WRONG THEY WOULD NOT HAVE TO BAIL THE COMPANY OUT
I HOPE THIS ANSWER HELPS
2006-11-14 22:27:35 · answer #5 · answered by dawleymouse 4 · 0⤊ 0⤋
that's why big firms have holding companIEs.IE parent company.because they take the money.but they will not be responsible for the debts.
2006-11-14 22:37:33 · answer #6 · answered by peter o 5 · 0⤊ 0⤋