{"ok":true,"canonical_url":"https://dealroom.so/glossary/power-to-control","api_url":"https://dealroom.so/api/public/glossary/power-to-control","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"power-to-control","term":"Power to Control","group":"Reading the business","definition":"The ability of one entity or individual to direct the management and policies of another, even without majority ownership. The SBA uses this concept to determine affiliation, which can impact loan eligibility.","what_it_means":"The SBA considers power to control a key factor in determining affiliation. This can arise from stock ownership (even less than 50% if it's the largest block), contractual rights (e.g., an option to purchase a controlling interest), or common management. If you or your affiliates have the power to control another business, that business's financials and employees might be counted towards SBA size standards.","url":"https://dealroom.so/glossary/power-to-control","official_sources":[{"slug":"13-cfr-part-120","title":"13 CFR Part 120 — Business Loans","official_url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120","official_label":"View on eCFR","authority_tier":1,"publisher":"Office of the Federal Register","source_guide_url":"https://dealroom.so/sba-7a/sources/13-cfr-part-120"},{"slug":"sop-50-10","title":"SOP 50 10 — Lender and Development Company Loan Programs","official_url":"https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs","official_label":"View on SBA.gov","authority_tier":2,"publisher":"U.S. Small Business Administration","source_guide_url":"https://dealroom.so/sba-7a/sources/sop-50-10"}],"related":[{"slug":"affiliation","term":"Affiliation","url":"https://dealroom.so/glossary/affiliation"},{"slug":"identity-of-interest","term":"Identity of Interest","url":"https://dealroom.so/glossary/identity-of-interest"},{"slug":"negative-control","term":"Negative control","url":"https://dealroom.so/glossary/negative-control"},{"slug":"size-standard","term":"Size standard","url":"https://dealroom.so/glossary/size-standard"}],"related_questions":[{"question":"How does the SBA define 'total control' rule to determine affiliation for size standards?","url":"https://dealroom.so/for-lenders/questions/how-does-the-sba-define-total-control-rule-to-determine-affiliation-for-size-standards"},{"question":"What issues in a franchise agreement typically lead to a determination of 'undue control' by the franchisor?","url":"https://dealroom.so/for-lenders/questions/what-issues-in-a-franchise-agreement-typically-lead-to-a-determination-of-undue-control-by"},{"question":"What is the definition of \"control\" for affiliation purposes in a 7(a) loan application?","url":"https://dealroom.so/for-lenders/questions/what-is-the-definition-of-control-for-affiliation-purposes-in-a-7-a-loan-application"},{"question":"How does the SBA determine \"common control\" when assessing affiliation for a management company providing services?","url":"https://dealroom.so/for-lenders/questions/how-does-the-sba-determine-common-control-when-assessing-affiliation-for-a-management-comp"},{"question":"How does the \"control\" principle trigger affiliation for purposes of determining a business's size standard?","url":"https://dealroom.so/for-lenders/questions/how-does-the-control-principle-trigger-affiliation-for-purposes-of-determining-a-business-"},{"question":"What specific limitations must a lender impose on a seller's post-closing consulting agreement to ensure it does not imply retained control or undue influence?","url":"https://dealroom.so/for-lenders/questions/what-specific-limitations-must-a-lender-impose-on-a-seller-s-post-closing-consulting-agree"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Power to Control","url":"https://dealroom.so/glossary/power-to-control","source_type":"DealRoom Data"}}