Study On Legal Issues Of China Mainland Financing Pawn

Compared with traditional pawn, Mainland China pawn is full of particularity, traditional pawn developed so far is mainly for the business pledge and the estate pawn, Mainland China pawn’s uniqueness is for its business pledge, which includes the real estate mortgage and property rights pledge. Due to the expensive price of the real estate, the mortgage for the real estate is difficult to apply for pactum commissorium. Thus, the nature of mortgage has been suspected by the experts until now. Because the "Real right law" detailed provisions of mortgage, thus, the mortgage pawn is lack of necessary existence. To some extent, shaping mortgage pawn into "yidang" of song dynasty may be can create a new kind of thinking tide, but the collection of the reference from "real Property law" is still necessary. In this research project, it is essential for the researcher to take principles of traditional pawn as references to illustrate the legal issues of financing pawn of China mainland. In addition to that, providing a brief review of the history about our traditional pawn is also required. In China, it is still a common phenomenon that pledge pawn is the same as mortgage pawn for most people. From the perspective of modern civil law, Pledge pawn is obviously different from mortgage pawn, which reflects its substantial rationality. In our country, confusion of these two concepts combined with the national circumstances, demonstrating a type of formal rationality. Form the view of modern civil law, "yidang" of Song dynasty is an indirect possession.Until 1990s, some traces of "yidang" still existed in pawn disputes trial judge of Mainland China. The pledg or has the possession of the pawn houses, but he/she have to make a payment of pawn interests to mortgagee. According to the comparison of relevant concepts, it is easily to further clarify the nature and characteristics of pawn. In the increasingly developed market economy society, there are two formation and three functions of collateral law, two forms refers to the transformation between collateral rights and the usufruct rights, the former on is opposite to obligee’s right, the latter is heavily rely on obligee’s right; three functions, one creditor has the possession, which enabled the debtor to fulfill the obligation, the second is the use of collateral to benefit the creditor to offset the debt, the last function is that creditors can get benefits from the exchange of collateral. In the current, collateral law of Mainland China was only with the second form as well as the first and third functions, while pledge pawn and mortgage pawn have the first form and the second function, which compensate the lack of collateral law of China mainland.In the implementation of China Mainland pawn, the establishment of pawn is still controversial topic. There are mainly four kind of force affected pawn relations establishment, firstly, pawnbroker granting credit loans, secondly, pawn ticket is the only evidence of the establishment of a pawn relationship, the third obstacle; bona fide pawnbroker handling stolen goods, fourth, pawn relationship is the barrier for the participant of the third sponsor. Redeem, continue and terminate are the most important factors in pawn, but the attribute of that is still controversial, the controversial topic proposed some questions; the redeems is right or obligation?if the terminate pawn will give rise to the breach of contract or not?If the outstanding interests can transfer into the calculation of principle when the pawn continued, when you continued mortgage pawn, is it necessary to re-apply for registration; how the relationship between terminate pawn and pactum commissorium,etc. Among those, the calculation of the rest interests has been attached much more emphasis than ever before. To deal with this kind of problems, regulations and the court judgment are all playing significant roles.In the end, the interests is the most critical measurement to determine the result. For the treatment of unredeemed goods, except pactum commissorium, consultation process and the court judgment has become the essential treatment. Courts judgment includes litigation and non-litigation. Although the judicial interpretation of the Supreme Court had the explanation for that, but the exist of non-litigation proceedings cases is still suspected by many experts.Compared with developed countries (regions), which take ordinary consumers as their mainly target group for pawn service, the Mainland China pawn’s main clients are SMEs, financial nature of its secured loan is more obvious, which is widely recognized in the pawn field. For instance, the statement of’unredeemed belongs to breach of contract’ is mostly agreed by the people in the pawn field. They all believe that pawnbrokers should undertake the legal accountability. It is known to all that the pactum commissorium is the decisive factor, if applicable, there was no breach. With the liberalization of the Mainland’s financial regulation, bank deposit and lending rates become gradually autonomous, as well as the introduction of some state support policies for SME, the domestic pawn industry, which focus on the leading will under attack. Hence, operating the traditional pawn, which mainly target to the ordinary customers will become an inevitable choice. To avoid the negativity occurred by private interest pawn,the government public pawn formation is a common practice in developed countries, which is worth for us to learn from. Adherence to the principle of legal real right is not suitable for development of the modern society, property rights from the long-term trading habits should also be given to the effectiveness of real rights, pawn right should be given the real right effect. As "measures for the administration of pawning" is just the administrative rule, not yet up to national law, so local courts in adjudicating pawn disputes did not applied it as the peremptory norms, besides, local trading habits is necessary to take into account, therefore, the phenomenon that the same kind of situation has different outcome of the trial is inevitable. Thus, China mainland financing pawn should be mentioned on the legislative agenda.