Dr. Jim Stewart:

Orphan ownership is also used in other countries. It is very common in the Netherlands, for example, to have these structures where there is no parent and no subsidiaries. The commercial advantage to orphan ownership is that it places a tighter control over the use of assets. There can be no subsidiaries. The parent company can have no claim over the assets and the creditors of the parent company can have no claim over the assets. It is less risky to a lender. Lawyers, accountants and all their advisers set up these companies because they are lower risk for the lender.