A Legal Analysis Of Nonrecourse International Factoring

International factoring business emerges rapidly in recent decades as a new means of settlement for international trade worldwide, and gains swift popularity in international trade practices by its peerless merits. Currently, factoring business has evolved into a global financial business, ranking as the mainstream payment means in international trade. Notwithstanding the foregoing, it lays bare as well a host of problems such as the tardy development in China of international factoring business without recourse, and etc. Among those reasons mostly imputable to include that the risk prevention in the current international nonrecourse factoring is absent and ineffective, that there is not yet a final conclusion on determining the legal basis of nonrecourse international factoring, and that there still lack of clear interpretations on the in-depth legal issues existing in nonrecourse international factoring. Therefore, the text focuses on searching for countermeasures to perfect international factoring legislation, through research on basic legal issues of nonrecourse international factoring, and further analysis on deep-seated legal issues of risk prevention. The text is divided into five parts which make a research on current situation of international factoring business and situation of nonrecourse international factoring business, reveal restraints in development of nonrecourse international factoring business, and make recommendations for further developing nonrecourse international factoring business.At first, conception, development and present situation as breakthrough point of international factoring is introduced in the first part of the text, in which definition and particularity of the nonrecourse international factoring is drawn. The part shows that international factoring business has gone through for a long history in our country, but nonrecourse international factoring business threatens most of banks engaging in international factoring business. The nonrecourse international factoring business has a good display of development trend on international factoring business leading into prospect profit in a huge amount. In view of theory and practice, our country is in need of development on nonrecourse international factoring business forming into reason to research the nonrecourse international factoring business.The second part in the context makes an analysis of law relations among parties of nonrecourse international factoring business, including law relation between exporter and importer, and among factoring agents, between exporter and export factoring agent, and between importer and import factoring agent. It carries such importance to know of the law relations for standardizing operation.The third part in the text makes an analysis of main problems concerned with assignment of debt in nonrecourse international factoring, and conflict of rights and solution caused from the assignment of debt. Considered as the key question in international factoring, certainly assignment of debt is the central issue of nonrecourse international factoring as well. Firstly as a matter of fact, assignment of debt in nonrecourse international factoring is an incomplete and special one belonging to civil law. Then another problem is discussed that the assignment of debt in the nonrecourse international factoring allows debt not impacted, and obligation must be taken by the original creditor exporter who should inform assignment of debt to loanee. Finally conflict of rights and solution caused from the assignment of debt in the nonrecourse international factoring is put forward.As the focal point of the text, risk and precaution of nonrecourse international factoring are primarily discoursed in the fourth part. Therefore, for research on nonrecourse factoring, how to make risk prevention carries the most importance under the condition without security guarantees. Firstly several points are explained from assignment of debt such as risk in nonrecourse international factoring, risk of legality, reality and assignability of debt in assignment of debt, and flaw risk in assignment of debt and risk which can not realize debt. There are some methods for risk prevention of assignment of debt such as validity, value, assignability, integrity and uniqueness of debt. And then risk in the system is illustrated from nonrecourse system. Risk prevention of system comprises much attention to commercial credit investigation and credit line risk control, establishment of credit line authorization system of accounting receivable of importer, guarantee on publish of importer, cautious investigation on importer, control via general credit mode, reasonable exertion of rights to abolish or reduce credit line in GRIF, approval and alteration for export factor on factoring credit line, and definition of credit risk and dispute. Finally risk precaution is analyzed in view of factoring contract.Combined with international factoring practice and relevant legal rule, in the last part, some plans to perfect nonrecourse factoring system is pointed out as essence of the text, which aims at promoting development of international factoring business in our country. Based on contract law, legal framework of international factoring establishes legal system of nonrecourse international factoring so as to assure efficiency on assignment of accounting receivable what will happen in the future in nonrecourse international factoring business, affirm written form of assignment of debt notice, and establish principles of conflict of rights solution in factoring business and registration system of assignment of accounting receivable. On basis of national legislation, action of international treaty and international practice is fully developed, legislation of international factoring is regulated and standardized, legal basis credit management system construction is enhanced so as to improve risk prevention capacity, and legal regulation system adapt to development of international factoring business is established. At the same time, the government should stipulate supportive policy as well, and perfect relevant laws regulations.