On Legal Problems Of Credit Asset Securitization

By exploring the definition, origins and characteristics of asset securitization, a structured finance tool, and introducing the normal procedures, the article analyzes the meaning of asset securitization in the economical operation. The author focuses on the legal problems of credit asset securitization, and proposes the related construction to improve legislation.The two core techniques in asset securitization are bankruptcy-remoteness and credit enhancement. The principal method to realize the bankruptcy-remoteness is to construct risk-remote mechanism which concerns asset transference and SPV's conformation. In this article, the author analyzes the trust mode of SPV, the realization of bankruptcy-remoteness, and the legal barriers of setting SPV in the form of company in our country as well. The author also gives the proposal of improving legislation on SPV.As to the legal problems in the process of asset transference, this essay probes the relations between the informing debtors and the legal validity of asset transference; the influence upon SPV's rights when original debtor claim offsetting and counterplea in the transaction of asset securitization; and suggests some preventive measures.The author also mentions how the initiator meets the demand of asset securitization's information disclosure, not disobeying the security responsibility to the debtor.As to the legal problems of credit enhancement, this essay mainly analyzes the legal circumstances of guarantee and bankruptcy, and recommends boosting the legal circumstances.As for the legal problems in the issue and transaction of securitized products, the article introduces the related legal system of foreign countries, analyzes the problems existing in our country's legislative practice, and suggests that the restrictions of fundamental assets and securities'issue should be relaxed, and that the scopes of investors be expanded. As far as the problem of supervising and managing asset securitization is concerned, it's essential to adjust the present supervising and managing system, forming a coordinated mechanism in every possible way in order to realize effectively the risk control of asset securitization.In order to promote the development of international asset securitization in China,the author proposes that the government should foster and relax the foreign exchange restrictions of securitization service, to give the preferential treatments of international asset securitization taxes.At last, the author presents the general legislative recommendations to promote the development of asset securitization in our country.