What are company affiliates? Affiliated entities of legal entities and individuals

According to the current law in our country, an affiliate is a status that can include both legal entities and individuals. It starts in English terminology. In translation " affiliate" has the same meaning as our verb "to attach" or "to bind." However, there is some difference between the European understanding of this term and the Russian one.

Legislation of the Russian Federation

In contrast to the understanding accepted in Europe, according to Russian laws, affiliated companies are those organizations that have the ability to manage other legal entities, as well as subsidiaries. This is often why you see the term “interconnected” companies. It is also included in the Tax Code Art. 20 and art. 105. There the persons are called not affiliated, but interconnected.

More full transcript What affiliates are can be found in Law 948-1. The concept also has extensive coverage in regulations regulating the activities of joint stock companies. They pay significant attention to the rights of shareholders. An example is Federal Law 208 of December 26, 1995, which establishes a special procedure for carrying out transactions with affiliated persons, and also regulates the possibility of providing information about them. There are references to these subjects of legal relations in the legislation relating to the securities market (Federal Law-39 04/22/96) and municipal enterprises (Federal Law 161 11/14/2002).

You need to know that accounting also includes deciphering what affiliates mean. The definition was included in Order No. 5n of the Ministry of Finance, which entered into force on January 13, 2000. All information about transactions carried out by persons related in this way is mandatory entered into the accounting records of the enterprise. This is done in cases where affiliated organizations have significant influence or control over the enterprise.

The word “affiliation” is rarely heard in ordinary everyday speech, since most average citizens have no idea what it means. Meanwhile, it began to appear very often in news reports and various analytical materials. Especially if we are talking about some kind of fraud or simply inaccessible ordinary people operations in legal and economic spheres, as well as in economic and organizational activities. And here the question arises: affiliation - what is it? It’s worth looking into this to understand what we’re talking about we're talking about when you hear the word again.

The concept of affiliation and its origin

This word comes from the English affiliate, derived from the Late Latin filialis, which means “filial”. IN English language this word means accession, that is, the term affilation will mean “connection” or “connection”. So, understanding the concept of affiliation, what it is, we are already beginning to understand. It turns out that this is a connection, a connection, a subsidiary of something. If we talk about the correct spelling, then here is “branch”, that is, the correct spelling is “affiliation”.

IN in a general sense This word means the dependence of a certain object on a larger one, its connection or subordination to it. This term is often used in the context of conversations about companies and organizations; one can even consider such a concept as site affiliation.

Use of the term in different situations

So, if everything is more or less clear with the concept itself, then it is worth considering it in different contexts. If we talk about firms and companies, affiliation can also be used here. What this is becomes clear if we say that we are talking about the organization belonging to a large company as a branch. At the same time, a subsidiary may well carry out its own economic activities, own its own reporting, but support the direction of the main company, and also be completely dependent on the decisions of its management. Practice shows that today affiliation is often used to split a business artificially in order to evade paying taxes, which causes a lot of trouble for fiscal authorities and other government agencies.

Affiliates

This concept implies that the physical or entity has the right and methods to influence the work of a business entity, expressed as an individual or legal entity, since it owns a share of its capital or is a member of the management body of the organization. This is where affiliation lies. What is it, and who can be considered such? Affiliated persons may include members of the supervisory board and the council, a member of the collegial executive body and others. They also include those who have the right to control more than twenty percent of the capital of the entire company or can influence the above positions.

When a legal entity enters a financial-industrial group, we can say that its members are also However, today this concept is more often used with a negative connotation, since it means participants or firms that have effective leverage over the legal entity, however hiding their presence in its economic activities.

It is also appropriate to use it on the Internet. And here underneath there are sites that are given a supporting role in promoting the main resource, which is the parent one. They are often called satellites or doorways. Usually, an entire network is immediately created, consisting of doorways, which are intended to transfer users to the promoted resource. So, it’s worth considering affiliation, what it means in this context, using the example of the Yandex search engine. Namely, how you can get out from under such a filter and which sites most often fall under it.

If contact information on two sites completely or partially matches, then Yandex perceives them as belonging to the same company, considering them affiliated. He has a special relationship with them - and here his position is that affiliated resources cannot be shown simultaneously in the results of search queries. That is, two of your sites will not appear simultaneously as a result of a search for one keyword, or Yandex will not display either of them at all.

Knowing that Yandex checks for affiliation, you should understand that such sites should not be promoted using overlapping lists of key queries, as this will not allow them to take top positions in search results. In the case when there is no intersection of the list keywords, you can achieve the desired result.

How it works?

The most relevant site will be shown in the search results for each search query. By this it should be understood that Yandex itself will determine which of them best matches the entered request. Of course, there are other factors that influence the position of a resource in the results: the age of the site, the quality and number of links to it, etc. Most often, the filter includes sites of fairly large companies that create big number resources for each regional center or city.

How to avoid being filtered?

Most often it works automatically. A filter applied in this way is usually removed in the same way, so there is no point in writing long explanatory letters to the search engine support service. All you need to do is eliminate the signs of affiliation and wait until the filter is automatically removed. If you purchased a new domain for yourself, but have nothing to do with sites from the affiliate network, the filter will be removed very quickly. Often, it is enough for Yandex to have a similar range of products on sites, descriptions and similarity of domain names in order to recognize them as affiliated. The situation is aggravated if there is a match in the registration data of hosting and domains.

An affiliate is a person (individual or legal) capable of influencing the activities of individuals or legal entities implementing entrepreneurial activity. In simple words, an affiliate (person or organization) is directly involved in control of the joint stock company.

The term "affiliate" as used in Russian legislation, was borrowed from Anglo-American law. English verb affiliate denotes verbs: connect, attach, connect.

“Affiliating someone” means introducing an official of another into the management of one company.

In European law, affiliated companies are companies that are dependent on other companies. In Russian legislation, the word affiliated is applied to both dependent and dominant persons. The main feature of affiliation is the ability to influence business activities.

Signs of an affiliate

An important feature of an affiliate is the existence of a dependent relationship between an individual or legal entity and an affiliate of this individual or legal entity.

This dependence manifests itself in the following cases:

When an individual or legal entity owns a certain share of the authorized capital of a legal entity with voting rights in the management body
- if an individual or legal entity, due to a certain legal status (for example, the status of a general director or fund manager), has the right to issue binding instructions
- if there are certain family ties (kinship relationships) between individuals

Affiliate of a legal entity

Affiliates of legal entities persons may be:

Member of the supervisory board or board of directors, member of the collegial executive body
- individuals or legal entities having the right to dispose of more than 20% of total number votes translated into voting shares or constituting the authorized capital contribution from the share of a legal entity
- a legal entity, if it is a member of a financial-industrial group (financial-industrial group).

“Affiliation procedure” is the process of one company entering the structure of another without changing the owner.

Affiliate of an individual

Affiliated individuals persons conducting business activities may be:

Persons who belong to the same group of persons as the individual
- a legal entity where an individual a person has the right to dispose of 20% of the total number of votes attached to voting shares or a contribution from the share of a legal entity that constitutes the authorized capital.

Joint-stock companies regularly provide information about their affiliates to the Federal Securities Commission. Also, any joint stock company is obliged to prepare lists of its affiliates for annual publication in the media. In addition, the lists must indicate the types and quantities of shares owned by affiliates.

Very often in a professional environment you can hear such a legislative term as “affiliated person”. What this term represents and who can usually be called such a term in the legal field, we will consider in the article.

The concept of “affiliated”: what is it and where did it come from?

First, let's figure out what the concept of “affiliated” itself means and to whom it can be addressed. IN colloquial speech this adjective practically never appears, so most people simply do not know what we are talking about. However, often this word can be heard in the news or analytical articles when it comes to fraud in the economic or legal sphere, as well as operations in these areas that are obscure to the average citizen. You can often hear about affiliates or law firms and even about affiliated Internet resources.

The word itself has Latin roots and originally referred to the word “son” (later the word “branch” was formed from this word), and later English version affiliate literally means “to attach something”, and English noun affiliation is translated as “connection” or “connection”.

Thus, we see that the word “affiliated” when translated into colloquial Russian means connected or subsidiary.

Since the word is not very common in Russian, it is often can be found different variants its Russian transcription, however, the form "affiliated" is the only correct one.

As we understand, an affiliated object is considered to be one on which the activities of other, less significant ones depend. Now let's look at what this concept is from a legal point of view.

Who can be an affiliate or company?

So, from a legal point of view, an affiliate is a person or organization that capable of having a direct impact for the work of another legal entity, be it big company or an individual entrepreneur.

Companies can also think so, and not only subsidiaries, but also those structures that have the right to manage the activities of other companies and legal organizations.

This concept itself does not exist in the Russian tax code, but it has been replaced by a more understandable name - an interdependent person.

Who is considered an affiliate: list of personalities and structures

For a company or other organization that is considered a legal entity, affiliates are categories such as:

• sole managers, board of directors or supervisory structure;
• citizens who are in the same group as the organization itself;
• persons who own more than 20% of the shares of this structure or its authorized capital;
• a company in which the structure in question has 20 percent or more of shares or capital (it is worth noting that affiliation is a two-way process);
• if the company is part of a financial or industrial group, then this is the management of that group.

In the case of individual entrepreneurs, affiliated persons are:

• those persons who are included in the same group of persons as the entrepreneur;
• a company or firm in which the entrepreneur has a share or part of the authorized capital in an amount exceeding twenty percent.

Group of persons with an affiliate: who are they and who can be part of it?

When we listed who can act as affiliates of a legal entity or individual entrepreneur, the group of persons that the company or entrepreneur can be a member of was mentioned. So, the members of such a group in the case of individual entrepreneur– these are his immediate family, including spouses, children, parents, brothers or sisters. But group members for a company are categories of persons who:

• can control more than half of the voting rights of the company's shares or more than half of its share;
• solely manage this company or structure;
• have the right to give instructions that require unquestioning execution;
• represent the majority of the supervisory and executive staff of the company’s management body;
• have the right to appoint or elect a nominee manager of the company;
• take part in the selection of most of the members of the company's supervisory and executive staff.

It is quite natural that members of a particular group can intersect and unite. For example, if two members of two different groups have great influence in the third group, but from a legislative point of view the first two groups should be considered as one.

Is there a need to provide information about affiliates?

According to the legislation that deals with the problems of monopolization, joint stock companies are required to provide such lists authorities. Such a report is required both to government agencies, to shareholders, and for accounting reports.

Why is this accounting necessary? The fact is that in cases where some entrepreneurs are able to strongly influence commercial structures, phenomena such as:

• biased and inflated pricing;
• persecution of competing structures using non-market methods;
• formation of monopolies.

If such a process is uncontrolled, then this leads to the destruction of entire markets, and at very different levels. IN Russian Federation Such records are maintained by the Antimonopoly Service.

What is an affiliate site?

There is also the concept of an affiliated Internet resource. In this context, this concept means something slightly different than in the legal context. Thus, an affiliate site is a site that created for the purpose of promotion main It can also be called a doorway or satellite. Developers can create a huge number of affiliate resources, which will ultimately lead the user to the site that is being promoted.

As you can see, when explaining the concept of affiliation, it becomes more understandable and you can understand what your interlocutor means when mentioning certain affiliates in a conversation or talking about the presence of affiliated sites around some major resource on the Internet.

Affiliate- this is an organization or an individual that is able to directly influence the activities of a business company through its participation in capital or through membership in governing bodies.

In this case, a connection is established between persons in a property and organizational sense. All subsequent actions are carried out only with clear coordination.

The parties involved have a direct influence on each other, which subsequently affects the process of forming economic relations.

This term appeared as a result of the transition to market economy in conditions of expanded and complicated economic ties between two economic entities. The following may be positioned as affiliates:

• high officials
• founders,
• shareholders,
• investors.

All of them can have a direct impact on the activities of the organization by participating in the management process. In most cases, the affiliate owns about ten percent of the firm's total available capital.

For legal and physical entities, the affiliate may not be identical. For example, in the first case, this may be a member of the supervisory board or any other management body. It may also be a person who exercises the powers of an executive body represented individually.

In addition, a person who belongs to the same group of persons as a specific legal entity can be called affiliated. If the founder has every right control twenty percent of the votes or, provided that he is a direct participant in the financial-industrial group, this also allows him to be positioned as an affiliate.

For individuals, affiliates may be persons who belong to a group that is identical to a particular physical entity. Another option is a legal entity in which the entity is authorized to control a twenty percent number of votes. In this case, they must be voting shares or be authorized capital from the total share of the legal entity.

This term is widely used in business legislation. It is important to remember that affiliates have a responsibility to notify the public when in writing about the shares being acquired, indicating their types and quantities. Moreover, this must be done within ten days after making their purchase. If this is not done, then as a result of such measures the company may face damage, which the affiliate undertakes to fully compensate. Any society must keep correct records of people of this type. At the same time, this must be done in accordance with all norms of current legislation.

The concepts of affiliated persons and groups of persons define the non-identical degree of connections between individual entities from a legal point of view. The fact is that persons cannot constitute a single subject of law, while a group of persons has full legal personality. However, this does not apply to all business relationships, but exclusively to those that have direct relation to the field of antimonopoly legislation.

Based on this, it is not difficult to conclude that affiliated persons can be positioned as a generic concept, and a group of persons - as a specific one.