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[Glossary] Controlling Relationship

M&A Tax

A controlling relationship is any relationship where a person or a corporation directly or indirectly holds more than 50 percent of the total number of issued stocks or the total amount of investments in a corporation (excluding treasury shares) (hereinafter referred to as “direct/indirect controlling relationship”), or a relationship between corporations, both of which have a direct/indirect controlling relationship with a person or a corporation in common.

Controlling Relationship

A controlling relationship is any relationship where a person or a corporation directly or indirectly holds more than 50 percent of the total number or of issued stocks or the total amount of investments in a corporation (excluding treasury shares) (hereinafter referred to as “direct/indirect controlling relationship”), or a relationship between corporations, both of which have a direct/indirect controlling relationship with a person or a corporation in common.

It is necessary to clearly understand whether there is a controlling relationship between the parties involved in a reorganization event as such a relationship affects the analysis of the tax qualification, the carryovers of net operation losses, and so on, in such an event.

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(As of July 2015)

This article is general in nature and is not intended to provide any tax advice on specific transactions. This article may not be relied upon by anyone and we accept no liability to anyone who took actions based on this article.

M&A Tax Glossary

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