Can a subsidiary transfer its creditor's rights to the parent company for free?

A subsidiary shall not transfer its creditor's rights to the parent company for free.

Legal analysis

Once a subsidiary is established according to law, it is an independent company with independent operation, independent profit and loss and independent settlement. A subsidiary has the status of a legal person and independently bears civil liability according to law. Once the company donates the impermanence of creditor's rights to the parent company, it may involve legal consequences such as harming the interests of subsidiaries and withdrawing capital contribution. The parent company shall not be jointly and severally liable for the debts of its subsidiaries. The debts of the subsidiary are paid off by the subsidiary with its own assets, but the creditors of the parent company can preserve and enforce the equity of the parent company in the subsidiary. The subsidiary and the parent company are legally independent legal persons, so when the assets of the subsidiary are insufficient to pay off the debts, the parent company does not have to bear it; However, if the company's continued operation harms the interests of shareholders, shareholders who hold more than 10% of the voting rights of all shareholders of the company may request the people's court to dissolve the company. There are two situations in which the parent company is liable for the debts of its subsidiaries: 1, failure to perform liquidation obligations, and the whereabouts of the property account books of the subsidiaries are unknown (applicable to disputes over the liability of shareholders for harming the interests of creditors of the company); 2. The parent company has made a debt commitment (applicable to the liability dispute of the cause of action liquidation group). The question for you is mainly about these two situations (of course, inviting him may also lead to situations, such as false investment, etc. ).

legal ground

Article 3 of People's Republic of China (PRC) Company Law An enterprise as a legal person has independent legal person property and legal person property rights. The company is liable for its debts with all its property. Shareholders of a limited liability company shall be liable to the company to the extent of their subscribed capital contribution; Shareholders of a joint stock limited company shall be liable to the company to the extent of the shares subscribed by them.

Article 74 of the Civil Code of People's Republic of China (PRC) stipulates that legal persons may set up branches according to law. Where laws and administrative regulations stipulate that branches should be registered, such provisions shall prevail. Branches engage in civil activities in their own names, and the resulting civil liabilities shall be borne by legal persons; It can also be borne by the property managed by the branch company first. If it is insufficient, it shall be borne by the legal person.