Research On Legal Supervision Of Financial Derivatives In China

Financial derivatives are the natural products of the financial market. It represents such investment tools that derivate from traditional financial tools. It has the advantage of avoiding risks. At the same time, because of the complicity designation and half-disclose information, it also contains highly graded risks. Financial derivatives were born on 1970's. Most investors prefer it for the function of saving value and avoiding risks. Due to the highly leverage and complicated structure, the process of design and exchange and the participant should be supervised effectively. If they are not under comprehensive supervision, one country's economy, even the world's economy can be affected. Therefore, researching on the legal supervision on financial derivatives has important theoretical meanings.Second-credit crisis originated in American, turn into financial crisis finally and made a negative impact on the global economy. The crisis was not burst groundless and baseless, but because of the bad supervision on financial derivatives. How to perfect the supervision on financial derivatives, not in the way of the development, become a hot topic among the authors in financial and legal after the outburst of the financial crisis. The financial derivatives endure a hard time during the early development. The biggest threat to the financial derivatives market is the lack of comprehensive designs on the supervision. The amended of the Security Law and the proposed of the contract brings a new stage. Under such circumstances, the first and urgent thing is to perfect the supervision on financial derivatives, avoid the risks, and encourage the development of financial derivatives well. They are also the practical meaning of the essay.The creative part of the paper is the analysis on the legal supervision on financial derivatives in China from supervision subject, supervision mode, and legal regulations of supervision. And give suggestions from the above aspects. The weakness part is lack of specific regulations on the legal supervision, owing to the blank of professional financial knowledge.The paper talked abut the perfection of the legal supervision on financial derivatives in China, on the basis of the analysis, comparison and study of the legal supervision of American and United Kingdom, and on the basis of statement on the present situation and existing problems of the legal supervision on financial derivatives in China. The passage is formed of three parts which are introduction, body and conclusion. The body is from Chapter two to Chapter five.Chapter two is an introduction of the financial derivatives and the theoretical basis of legal supervision. This part introduces the domestic and foreign definitions of the financial derivatives, make outlines of the characteristics of the financial derivatives, and list several types of the financial derivatives. What's more, this passage analyzes the legal nature of the financial derivatives from the aspect of the contract legal relationship. And prove the necessity of the supervision from macroscopic and microcosmic.Chapter three is the comparison of the legal supervision of American and United Kingdom. First, the passage introduce the mode of the legal supervision of American and United Kingdom, on the basis of which, the essay compare the two regulations. Secondly, the passage concludes that the points we should learn from are the perfect regulation system, clear divisions of duties, and strengthen of exchange self-strict.Chapter four is a sketch of the situation of the legal supervision on financial derivatives in China, defects included. The paper discuss the problems existed in the supervision subject, the supervision mode and the supervision legal norm. It also points out that there still are supervision leaks although the supervision subjects are so many, and the self-strict function of the exchange has not been totally developed, and the regulations are almost restricted.Chapter five is the statement of the perfection suggestions of the legal supervision on financial derivatives in China. On the aspect of supervision subject, the division of the responsibilities should be cleared. On the aspect of supervision mode, the government should take the duty as a leader and daft regulations to lead the development of the financial derivatives. On the aspect of the regulations, the best way is to daft Financial Derivatives Law, as well as the amendment of Bankrupt Law and Company Law.