Group of companies, what are the stakes?
What is a corporate group?
A corporate group is an economic entity formed by a group of companies controlled by the same company, including the controlling company.
From a legal point of view, the notion of group is not defined. There is no group identification number like the SIREN for companies, for example.
The companies that make up a group are distinct; each has its own legal personality. They may be of different sizes and legal forms. What binds them together is the fact that they are controlled by the same entity, and therefore are part of a common strategy.
What are the particularities, advantages and obligations of a group of companies?
Generally, a group is composed of a holding company, which can be active or passive, subsidiaries, sub-subsidiaries and participations, including operational companies, but also non-trading real estate companies (to protect real estate assets).
The advantage is mainly fiscal, because the integration consolidates all the results on the holding and thus compensates the profits and losses between the companies, avoids double taxation and allows a tax exemption.
The consolidation of accounts is mandatory for any group of companies that crosses one of the following two thresholds: more than 250 employees, a balance sheet exceeding 24 million euros and/or a turnover exceeding 48 million euros.
Examples of a group of companies
To be defined as a group, the entity must have a common controlling entity, called the "Group Head".
This group head can be:
- A State Administration: the State Holdings Agency is, for example, at the head of several important groups (RATP, BPIFRANCE, FRANCE MÉDIAS MONDE, GIAT INDUSTRIES, AREVA, SNCF...)
- A publicly traded company: LVMH, TOTALENERGIES...
- A family holding company owned by one or more individuals
- A protean entity: all the local branches of a mutual bank, all the members of a mutual insurance company.
Group of companies, which organization?
What is a group leader?
The INSEE defines the head of a group as "a company not controlled directly or indirectly by another, and having at least one subsidiary". It is therefore the controlling company, sometimes defined as the "umbrella company". In principle, the head of the group is a company with a legal personality. It can be a private or public company, French or foreign.
As mentioned above, the concept of a virtual entity, considered as the head of the group, can be useful for an overall view of mutual companies. This virtual entity has no legal reality and does not consolidate the accounts of the group, but this concept makes it possible to identify a coherent group of companies with a common strategy and interests.
A definition linked to needs
Although the definition of the group head is precise, the need may require variations depending on the regulations.
Compliance (Sapin 2 and LCB-FT)
The regulations require knowing the ultimate group head, i.e. the one that meets the official definition.
Business
From a business and marketing perspective, segmentation sometimes requires defining :
- The head of the group in France, while the ultimate shareholder is abroad
- The last private group head, to dissociate the different groups controlled by the State
Depending on the objective, the concept of "head of the group" should be nuanced to obtain representative sets and subsets.
Why is a good knowledge of groups important?
Knowledge of groups addresses several issues:
- Risk: belonging to a group positions the company in a strategic and financial environment that is essential to know before starting a business relationship
- Compliance: third-party knowledge extends to the highest level of shareholder
- Commercial: major accounts (groups) must be understood in their entirety (framework contracts)
- Marketing: knowing the outline of a group allows for more precise targeting
Globally, knowledge of a company is not limited to its identity, its activity and its performance. Its economic environment, its independence and its strategy are essential elements to understand, whatever the relationship envisaged.
