What is the difference between a branch and a subsidiary

To understand the difference between a branch and a subsidiary, you can look at the Civil Code. It details the features and powers of these divisions of the parent enterprise. Before starting the expansion of his business, a businessman should figure out which unit will be more profitable to open.

Many businessmen do not see the difference between opening a branch, representative office or subsidiary. Meanwhile, it is also very tangible. Before deciding on the reorganization of existing production, one should understand the terms and choose the most acceptable form of expansion of activity.

What is an affiliate?

This word refers to a separate division of a legal entity, which gives it a full range of powers or only part of it. A branch of an enterprise or organization may be located in a foreign state. In this case, all aspects of its activities should be coordinated with the legislation of this country, since it can significantly differ from domestic.

The branch is included in the unified state register, but it is not a legal entity. He is completely subordinate to the management of the parent company and exercises his authority only on the basis of a power of attorney. The fact that such a "separate division", branch and representative office, reports art. 95 of the Civil Code of the Russian Federation. The Civil Code spells out all the stages of opening a branch.