State-Owned Enterprises Restructuring Through Holding Company in Responding Bankruptcy in Subsidiaries

Abstract

The present study aims to determine StateOwned Enterprises (SOEs) restructuring through holding companies in responding bankruptcy in subsidiaries. It is also initiated by the issue of bankruptcy as a risk that can occur both on holding company and its subsidiaries in a holding company of the SOEs. If subsidiaries are in bankruptcy, the SOEs are not a trivial matter to face this possibility since the position of the subsidiaries and holding company are separate. The present study was conducted using normative juridical. It concludes that, first, although a holding company was formed, the holding company and its subsidiaries as separate and independent companies in carrying out their activities were each limited by the existence of separate legal entities and limited liability. Second, bankruptcy in subsidiaries included in SOEs holding companies could occur and the form of liability of holding companies which are that of in SOEs were limited to the shares. Besides, if the SOEs holding companies caused bankruptcy in subsidiaries in managing financial management, the liability could expand. KeywordsBankruptcy, Subsidiaries, Holding.