The Bank Loan And Private Loan Via Bank Regarding The Unfair Related Parties Transactions

Both the loans made by the bank with the capital of bank (refers to as bank’s loans) and with the cash of the private owners including the government,enterprises, and individuals (refers to as private loan via bank) consist of the bank loans according to the rules of bank Loans in the P.R.C..The commercial bank may charge the lender the interest under the bank’s loans agreement. The bank may only collect service charge under private loan via bank agreement. They are two different types of loans, but it is confused that the private loan via bank are not applicable to the rulings of the banking law. Nevertheless, both two types of loans cause the problems of irregular related parties transaction of loans.The outlines of this research on the rulings of irregular related parties transaction of loans are as follows:Chapter I:This chapter mainly focuses on the analysis of the difference of legal definition between two kinds of loans, and figure out those related problems behind them. It is figured out that the legal entities of private loans via bank is the private cash owners (i.e. the companies) instead of the banks, although the loan agreements are signed by the banks under the instructions of the private cash owners. The banks are not responsible to the private loans via bank agreements if the borrowers breach the agreements. However, it is conflict that the private cash owners as the legal entities of the private loans via bank agreements are not entitle to lawsuit the borrowers when the borrowers breach the agreements in judge’s practice. I advocate that the private cash owners are entitle to claim when the borrowers breach the agreements.Chapter II:The chapter discusses the issues of irregular related parties’transactions of loans happened in the bank loans and the private loans via bank.The problem of irregular related parties’ transactions involves the definition of related parties. It is the criteria that the one party hold the controlling power or the influence power of the other party consists of the related parties.It is convinced that the characteristics of irregular related parties’ transactions of loans include:the unfair opportunity of applying a loan, the unfair interest rate compared to the un-related parties, the improper purpose of applying a loan, and unreasonable result of the loans. There are many cases show the crisis being made by this kinds of irregular loans.Chapter III:The chapter introduce the principles of the ruling regarding the irregular related parties’transactions of loans include:to forbidden the behavior of related parties’ transactions of loans such as the credit loans made to the related parties, to maintain the equal treatment of loans made to either the related parties or the outsiders, to put the ceiling of amount of the related parties loans, and to request the bank to disclose the information of related parties loans. The current rulings concerning the related parties transaction of bank loans remain two problems:Firstly, is it against the principle of equal treatment if the related parties have more opportunity to make loans than the outsiders. Secondly, should the local government be deemed as the related parties if she applies a loan from the local bank of which the government is the investor. The current rulings concerning the related parties transaction of nonbank loans remain some problems such as:it is irrational that the private cash owners as the legal entities of loans agreements are not entitle to lawsuit the lenders once the lenders breach the agreements, and it is needed to put more serious punishment on the irregular related parties’transactions of nonbank loans.Chapter IV:The chapter introduces the rulings regarding the irregular related parties’ transactions of bank loans in U.S.A. and Taiwan area. It seems that the rulings among P.R.C., U.S.A. and Taiwan area are almost the same. However, it is different that the rulings in Taiwan area allow the loans of consuming made by the bank to the staff. It is also different from P.R.C., that the rulings request the bank to disclose more detail information of related parties transaction of bank loans in U.S.A. as well as Taiwan area.Chapter V:The chapter approaches the improvement of the current problem of the rulings regarding the irregular related parties’transactions of bank loans. It is clear that the abuse of the power happened in the management team of the bank causes the problem of irregular related parties’transactions of bank loans. It is believed that the rulings should ask the bank to disclose more detail of information regarding the related parties’transactions of bank loans in P.R.C., It is also suggested that the rulings allow the loans of consuming made by the bank to the staff, and the local government should not be in the restrictions of the related parties’transactions of bank loans, it is advocated that the private cash owners as the legal entities of loans agreements are entitle to lawsuit the lenders once the lenders breach the agreements, and the rulings should put more serious punishment on the irregular related parties’ transactions of nonbank loans.