The Study On The Legal Problems Of Protection The Investors In Securitisation

Asset Securitization is a new financing technique that begins in the U.S..Because of its advantages it is adopted widely by a lot of other countries.In 2005,China has begun the practice of securitization.In securitization,the risks that the investors faced are special,and the law that protect the investors is special.This article argues the law that protect the investors in securitization.It includes three parts.The first part is about the definition and business process of the Asset Securitization.On the basis of these content the risks that the investors faced in the Asset Securitization are introduced.Among these risks the risk of bankruptcy remote and the risk of information disclosure are the emphasis that this article talks about.Chapter 2 included two parts.It discusses the juristical foundation and substantive law system of protection of the investors in securitization. There are two mechanisms—bankruptcy remote and information disclosure in the substantive law system of protection of the investors in securitization. Some international advanced legislative experience is offered.The mechanism of bankruptcy remote included two steps—the construct of the SPV and "true sale".The legal form for an SPV is usually a trust or a corporation.Both legal forms would be constructed under the principle of bankruptcy remote and fulfill five requirements below.The five requirements included the speciality of the transactions,the independent director,the precaution of the doctrine of substantive consolidation,the conference of investors that hold the asset backed securities and the inspector of the trust,the support of governmental creditThe conception of true sale exists in the American legislative system. Some standards are formed in the American judicial system.They are the standard of recourse,the standard of the right to redeem collateral,the standard of the payment of a holdback,the standard of price-making and the standard of the right to control and manage the account of the credit. Two steps are accomplished perfectly,then the investors would be protected.The mechanism of information disclosure doesn't only exist in securitization.Because of the new characteristic,the system of information disclosure in securitization shows the trend that adapt to the requirements of securitization.The legislative system of U.S.,Japan and the district of Taiwan is advanced in this aspect.The international treaty provides the duty of Bank in securitization.In the third part,the writer studies the conditions that the protection of investors in securitization in our legislative system of securitization. Advantages and disadvantages exist contemporarily.The main points are the disadvantages.How to learn from the international advanced legislative system and improve the disadvantages is the main content of the third part.