Research On Finacial Innovation Under The Rule Of Law

Since the end of last century, financial market has been developing rapidly and there have been more and more financial innovation. Analysing the background, impact of financial and the causes, the characteristics, the process of financial innovation, we will find that the rule of law is necessary for financial innovation. In the process of financial innovation, the rule of law not only can regulate the subject of the financial innovation, but also can contribute to the furtherance of the financial supervision and the limitation of the financial supervision.Financial innovation under the rule of law is, to regulate the financial innovation according to the law, to provide sufficient legal basis and legal protection for the rights about financial innovation, to constitute a safeguard against the abuse of government power, to adherence legal authority. In this way, the rule of law infiltrates and integrates the financial innovation, and therefore it keeps the financial innovation flow smoothly. Financial innovation under the rule of law is a state, a process and a goal.There are some ideas of law which are important for the financial innovation under the rule of law: The rule of law means that all social activities go in accordance with the rules; The rule of law means not only the authority of the government but also the confine of government power; The rule of law means both material nomocracy and formal nomocracy.According to Aristoteles'theory, the rule of law means good laws and law -governing application. In order to make good laws for financial innovation, we should know when to make a law, how to expect elasticity of legislation and how to learn from foreign countries; we should specialize the legislation; we should know the different between when to make a policy and when to to promulgate a law; we should not only pursue the number of financial innovation, but also protect the rights of the consumer and investor. Specifically, our state should improve the rules of market access, the corporate governance, the release of information, intellectual property and so on. In order to put the law in force, first, we should improve the government functions of financial supervision and keep the supervision in accordance with the law. Therefore we can protect the disadvantaged groups such as the consumer. At the same time, we can prevent financial supervision from killing the innovation. Second, we should explore the way of judicature- how to remedy the loopholes or defects caused by financial innovation by construing the laws. Third, we should make the subject of the financial innovation observe the law and protect their rights themselves. Thus the trade self-discipline also can be improved and the legal awareness of the whole city will be enhanced.