§ 1704. Exemptions applicable to subsidiaries; limitations generally.\n(a) Investments in separate account subsidiaries and in investment\nsubsidiaries are exempt from the provisions of subsection (a) of section\none thousand seven hundred five of this article and separate account\nsubsidiaries and investment subsidiaries are exempt from the provisions\nof item (ii) of section one thousand seven hundred ten of this article.\nInvestments by the parent corporation in holding company operating\nsubsidiaries are exempt from the provisions of paragraph two of\nsubsection (a) of section one thousand seven hundred five of this\narticle.\n (b) Subsidiaries that become such as a result of (i) the acquisition\nof securities received as permitted by subsection (e) of section one\nthousand four hundred three of this chapter or (ii) the temporary\nassumption of control by the owners of securities upon the happening of\na contingency are exempt from the provisions of section one thousand\nseven hundred eight and item (ii) of section one thousand seven hundred\nten of this article for one year, and from the provisions of subsection\n(a) of section one thousand seven hundred five of this article for five\nyears, after becoming subsidiaries.\n (c) Investments in subsidiaries engaged or organized to engage in any\nkind of insurance business in which the parent corporation may engage,\nand investments in subsidiaries engaged or organized to engage\nexclusively in the ownership and management of such subsidiaries, are\nexempt from the provisions of subsection (a) of section one thousand\nseven hundred five of this article.\n (d) Investments made or acquired by investment subsidiaries shall be\ndeemed, for the purposes of this chapter, to be made or acquired\ndirectly by the parent corporation (pro rata, in the case of a\nsubsidiary less than all of whose voting securities are owned by the\nparent corporation, in accordance with the parent corporation's\ninvestment in such subsidiary), and shall (to such extent) be subject to\nall the provisions and limitations (including quantitative limits) on\nthe making thereof specified in this chapter with respect to investments\nby the parent corporation.\n
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