Study On Legal Issues Of Banking Financial Institutions Compulsory Withdrawal In China

The establishment of compulsory withdrawal mechanisms of banking financial institutions can speed up the risk handling procedure of the financial institutions and therefore shape the market competition environment. As two main ways of compulsory withdrawal, the cancellation and the bankruptcy shall be exercised respectively according to the different situations of the problem financial institutions. However, a large number of financial institutions in China which shall actually be bankrupted were withdrawn by the way of cancellation, and many institutions which were ordered to stop business also found it hard to withdraw from the market. Therefore, laws and regulations regarding the compulsory withdrawal shall be enacted, a distinction be drawn between the cancellation and the bankruptcy, governmental over-intervention be prevented and relevant auxiliary systems be established so as to improve compulsory withdrawal mechanisms of banking financial institutions in China.Except for the preface and the epilogue, this disquisition divided itself into four chapters to expatiate the legal issues:Chapter 1 illuminated the differences between the cancellation and the bankruptcy in legal level, and discussed the optimization of the distribution of legislative and executive power in withdrawal mechanism between the supervision and the court.Chapter 2 exposed the primary issues arising from the practice of compulsory withdrawal in China and analyzed the reasons for these issues, including the lack of systematic regulations on compulsory withdrawal, illegibility of the line between the cancellation and the bankruptcy in the practice, the government dominating the process of withdrawal, the insufficient ability of the court in dealing with the bankruptcy case, and so on.Chapter 3 reviewed the compulsory withdrawal system of banking financial institutions in the U.S.A and the U.K., and analyzed that system in the aspects of legislative pattern, the leading institution, as well as the startup requirements of the cancellation and the bankruptcy, in order to draw useful experience for reference to the completion of that system in China.Based on the present situation of compulsory withdrawal system and supervision system in China, Chapter 4 brought forward proposals on interrelated legal issues including the completion of compulsory withdrawal legal system in China, the establishment of criterion on distinguishing between the cancellation and the bankruptcy, and the restriction of government's expanding power in compulsory withdrawal system. This chapter also discussed the relative issues on the construction of deposit insurance system and the cultivation of specialized bankrupt court.