Restructuring Of Charitable Trust System In China

The promulgation of PRC Trust Law in October, 2001 symbolizes the formal establishment of trust system in China. It is the mile stone for the development of trust system in China as it provides a basic frame for the regulation of the legal relations under trust. Regulations for charitable trust are provided in a sole Chapter in Trust Law, meaning the commencement of establishment of charitable trust system. However, few practices had been carried out in the following years after the promulgation of Trust Law, which requires a reflection on the approach of the restructuring of the charitable trust system, and brings the commencement of this thesis.Provided the character of Legislation-precede-Practice in the structuring of China's charitable trust system, legislations are supposed to meet the requirements from the two perspectives, the macro level regarding the structure of the basic legal relations between parties under a charitable trust and the middle level regarding relatively specified factors. According to the analysis of two levels of legislation, we found that the structuring of the charitable trust system in China is against the background of commercial trust–oriented legislation of PRC Trust Law, which resulted in the generality of legislation and the vagueness in the definition of the system function, further leading to the mistake made in choosing the induction mechanism. Therefore, the structuring of charitable trust system turned out a failure as a logical consequence.In analyzing the mistakes made in the structuring of the system, the approach thereof is becoming clear: it should start with a clear definition of system function, which constitutes the reasoning process with sufficient consideration; be followed by choosing an induction mechanism connecting the rationale and the practice, to maximize the effect of legislation guidance, by which the perceptual knowledge is increased before the elaboration of the restructuring of basic mechanism, where the former provides a basis for the latter by overcoming the deficiency in lack of practice knowledge.Therefore, the basic frame of this article is as follows:Part I, to make a brief introduction for current legislation regarding charitable trust to analyze the negative impact exerted by the Commercial-Trust-Oriented legislation of trust law on the structuring of charitable trust system;Part II, to clear the approach of the system restructuring, and therefore to give a clear definition for the function of charitable trust system, through the analysis of the Legislation-precede-Practice characteristic in the structuring of the charitable trust system;Part III and Part IV, to dwell on the restructuring of the supervision mechanism and stimulation mechanism under the frame established in Part II.