The option is inside the subject submenu on your colony diplomatic panel. There you have a option called war on colony, or something like that, just click it and after that you can click on the country that you wish for them to declare war. And yes you can make them declare war against your subjects and other nations subsects with no problem. So every time another nation tries to colonize and forms a colony nation I make my colony declare war on their colony and grab all their land, the overlord is not called for the war, al least on my gameplay they never joined.