Controlling Undertaking
Controlling Undertaking : According to European Union (EU) legislation, an undertaking that can exercise a dominant influence over another undertaking (the controlled undertaking), for example by virtue of ownership, financial participation or the rules that govern it. The ability to exercise a dominant influence shall be presumed without prejudice, when in relation to another undertaking. An undertaking directly or indirectly: holds a majority of that undertaking's subscribed capital, or controls a majority of the votes attached to that undertaking's issued share capital, or can appoint more than half of the members of the undertaking's administrative, management or supervisory body (Article 3.2, Directive 94/45/EC). A controlling undertaking's rights to voting and appointment include rights of any other controlled undertaking and those of any person or body acting in his or its own name but on behalf of the controlling undertaking or of any other controlled undertaking. An undertaking shall not be deemed to be a "controlling undertaking" with respect to another undertaking in which it has holdings, where the former undertaking is a company referred to those defined by Council Regulation 4064/89/EEC of 21 December 1989, on the control of concentrations between undertakings. A dominant influence shall not be presumed to be exercised solely by virtue of the fact that an office holder is exercising his/her functions according to the law of a Member State relating to liquidation, winding up, insolvency, cessation of payments or similar proceedings. The applicable law in order to determine whether an undertaking is a "controlling undertaking" shall be the law of the EU Member State that governs that undertaking. Where the law governing that undertaking is not that of a Member State, the applicable law shall be the law of the Member State on the territory of which the representative of the undertaking is situated - or in the absence of such a representative, the central management of the group undertaking which employs the greatest number of employees. In the case of a conflict of laws, if two or more undertakings from a group satisfy one or more of the criteria laid down in Directive 94/45/EC, the undertaking that satisfies the criterion of being able to appoint more than half of the members of the undertaking's administrative, management or supervisory body shall be regarded as the controlling undertaking, without prejudice to proving that another undertaking is able to exercise a dominant influence. See: Community-scale group of undertakings
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