Liability of Holding Companies

Today we see more and more companies restructuring their organisations and facing liability issues with respect to their activities in different jurisdictions. The trend to centralise management functions in a holding company, with directors of holdings also serving as directors of affiliates, increases the risk of liability issues to a considerable extent.

Thus, a good governance model within companies maintains still a central factor and gives lawyers an important role in advising on liability issues both with respect to transactions and with respect to contentious matters arising from violation of the corporate rules or from third parties' actions.

In this context, the CMS Corporate publication “Liability of Holding Companies” is an excellent piece of know-how to help clients assess the liability of a holding company for the behaviour of an affiliate. This publication sets out a summary of the basic principles pertaining to liability within corporate groups as applied in 14 of the CMS European jurisdictions.