1. The broad effect of this arrangement is to relocate ACT in thesubsidiary company, which can then be carried back. (BNCI)
2. In law, the subsidiary company is a distinct entity, regardless of the control exercised over it, and it will be doing its own business not that of its parent. (BNCI)
3. The subsidiary company is not allowed to acquire shares in the holding company and no person may be a member of the board of directors of both companies. (BNCI)