On The Legal Risks Of China 's Stock Ownership And Its Precaution

As one of major Internet financial formats, crowdfunding has been reported specially by the CCTV news, and equity crowdfunding is the most complex, the most potential crowdfunding model in various crowdfunding model. The State Council Premier Li Keqiang specifically pointed out that it was need to carry out the equity crowdfunding pilot in the State Council executive meeting. But the development of equity crowdfunding in China still faces many legal obstacles and risks. In order to circumvent the legal barriers, the earliest adopters of equity crowdfunding modified equity crowdfunding with “private transformation”, and it produced the <Private equity crowdfunding management measures(trial)> which was looking for views, but the “private transformation” limited the original value, significance and function of equity crowdfunding. So, it is necessary to analyze the legal risks existing in our country’s equity crowdfunding, and explore the corresponding prevention measures, in order to promote the comprehensive development of equity crowdfunding in our country. This article is based on this, divided into three parts to discuss the legal risk of our country’s equity crowdfunding and its prevention.The first part introduces some basic issues of equity crowdfunding, including the rise of equity crowdfunding, operation, function, development status and qualitative five aspects. In the section of the rise of equity crowdfunding, use crowdfunding as the generically concept to lead to the concept of equity crowdfunding, and analyzes the financial innovation from equity crowdfunding; in the section of the operation of the equity crowdfunding, introduces three main participants of equity crowdfunding, and combs the operation process of equity crowdfunding; at last, introduces the function, development status and qualitative of equity crowdfunding.The second part analyzes the legal risk of our country’s equity crowdfunding in the view of three main participants of equity crowdfunding. First, investors are facing the risk of high incidence of fraud and the lack of effective exit mechanism; second, financiers are facing the risk of being involved in illegal financial activities, such as illegal fund-raising and illegal issuing of securities, and the risk of the intellectual property rights is difficult to obtain the full protection; last, equity crowdfunding portals are facing the risk of the unclear legal status and the unclear rights and obligations.The third part is the focus of this paper, it points out to prevent the risks above from perfecting the supervision, strengthening self-discipline, establishing and improving supporting system three aspects. In the aspect of perfecting the supervision, based on Jumpstart Our Business Startups Act experiences and comparative analysis of our country’s <Private equity crowdfunding management measures(trial)> which is looking for views, this paper puts forward some concrete suggestions from defining the legal status of equity crowdfunding, expanding the concept of securities, exempting equity crowdfunding, strengthening the protection of investors and improving the information disclosure five aspects. In the aspect of strengthening self-discipline, this paper advices that the self-discipline of securities industry, the self-discipline of Internet financial industry and the civil self-discipline, three forces should cooperate with each other, and achieve common development. In the aspect of supporting system, this paper hopes establish and perfect the Internet financial credit system and the secondary markets of equity crowdfunding.