Dótturfyrirtæki

Dótturfyrirtæki is an Icelandic term that translates to "subsidiary company." It refers to a company that is owned or controlled by another company, known as the parent company. The parent company typically holds a majority stake, often more than 50% of the voting stock, in the subsidiary. This ownership grants the parent company significant influence over the subsidiary's management and operations.

Subsidiaries can be established for various strategic reasons. They might be created to enter new markets, to isolate financial risk, or to specialize in a particular product or service. In some cases, a subsidiary may operate under its own brand name, maintaining a degree of independence in its day-to-day activities while remaining under the ultimate control of the parent. The legal and financial structures can vary, but the core relationship is one of ownership and control. The parent company is responsible for the subsidiary's performance, and profits or losses from the subsidiary typically flow up to the parent.