Holding. Holding company in Europe. Working schemes

The need for a holding company usually appears when a business already consists of several companies, assets or investment directions. A parent company makes it possible to combine ownership interests in the companies and centralise decisions on financing, acquisition of new assets and distribution of profit. For the owner, this means a clearer ownership structure and the ability to develop separate business directions independently. A European holding company is especially convenient when the main assets, banks or business partners are in Europe.

What tasks a holding company solves

As a rule, a holding company is created by acquiring interests or shares in companies that will become members of the group. This structure helps strengthen the group's reputation, promote one trade mark, attract financing and combine companies with different functions: trade, production, ownership of real estate, intellectual property and investments.

• ownership of shares and interests in subsidiaries;
• ownership of real estate, land and other assets;
• ownership of trade marks and other intellectual property;
• financing of group companies and attraction of investment capital;
• centralised management of companies and individual projects;
• organisation of professional services for members of the holding group.

What to consider when choosing a country

The first criterion is the possibility of opening a business bank account that matches the size and nature of the investments. The bank must understand the ownership structure, sources of capital and future holding-company payments. The second criterion is the current treatment of dividends and capital gains, as well as double-tax treaties with the countries where the subsidiaries are located.

In addition, the rules for maintaining the shareholder register, the principle of tax residence, the cost of accounting and company support, and the business reputation of the jurisdiction are assessed. For a European group it is useful to check separately the application of double-tax treaties and the EU-wide regime for parent companies and subsidiaries.

European holding models

In most European countries, the holding function can be performed by an ordinary company that owns interests in subsidiaries. Such options include Denmark, the Netherlands, the United Kingdom, Cyprus, Spain, Switzerland and other well-known business jurisdictions. Some countries offer special investment forms or participation regimes, so the final choice depends on the composition of assets and sources of profit.

For EU companies, the Parent-Subsidiary Directive remains an important starting point: for qualifying companies, the basic EU-wide participation threshold is 10%. National rules may provide their own criteria. For example, Spain applies a 95% exemption for qualifying dividends and income from the sale of shares when the applicable conditions are met, including a basic participation criterion of at least 5%.

Company + business bank account + financial scheme

It is better to design the holding structure together with opening the business bank account. If the company will receive dividends, buy shares, finance subsidiaries or purchase real estate, these operations should be clear before the account is opened. For opening the business bank account, the group scheme, business description, list of assets and expected payments are used; we support the opening of the business bank account for the actual activity.

This allows the owner to see not only the legal structure but also the working scheme of capital movement: from the operating company to the parent company and then to new investments.