What Is A Dual Company Structure?

A dual-company structure involves two companies: the holding company and the operating company (also known as the trading company).

In this configuration, each company does exactly what their titles suggest. An operating company does things, a holding company holds things.

In this structure, the holding company wholly owns the operating company. The operating company owns the company’s major assets and capital — such as intellectual property, real estate, cash and any liabilities. The holding company does not oversee the day-to-day workings of the business.

The operating company will carry out the traditional operations and day-to-day work of the business, like entering into contracts with third parties, hiring employees, providing goods and services, and dealing with customers.