Controlled Group, Separate Lines of Business, BRF

Parent Company 1 owns 100% of Company A which has a standard 401k plan with no match or SH at platform X (200 employees). Parent Company 1 purchases 100% of Company B which has its own 401k plan with a match and safe-harbor at platform Z (with 20 employees). I understand there is a period of transitional relief. In what circumstances could each plan operate individually on their own platforms without any combined testing or BRF issues? Is there something about "separate lines of business"?

There is something called a Qualified Separate Line of Business which would allow you to disaggregate the plans and test them individually, but each QSLOB must have at least 50 employees (plus other requirements) so that is not going to help you here since B has only 20 employees.

If each plan satisfies minimum coverage separately, then you are good.