Financial Mixed Trend In China's Legal Thinking

After China's accession of WTO, China will open its financial market according its commitments, which will make the China into the stream of world's financial liberalization . As a result of this , the Chinese financial industries have to confront severe competition with foreign financial industries. The foreign financial industries have developed for hundred years and owned strong operation abilities and good business record with global financial networks and advanced management concepts and decision-marking system, which will threat Chinese financial security. So it is urgent for Chinese banking to reform and improve the legal system and establish the rational and competitive circumstance.The text divides into three parts altogether:The first part of this thesis summarized the course of and the reasons for the financial system's evolution from single financing to mixed financing. It analyzes the origin of legalization for single financing and also illustrates the gradual weakening of it. Based on studies on the legalization of, historical rationality for and the realistic shortcomings of such model it concludes the inevitability for mixed financing given the financial globalization background.The second part compares domestic and foreign conditions in legalization, supervision and financial institutions; it argues that it is not the proper time for domestic transforming from single financing to the mix model. Many problems exit especially in respect of financial legalization aspect. Firstly redundant legalization level and conservative preference lead to obstacle in financial innovation. At the same time legalization absence coexists with inferior legalization owing to improper legislative distribution, for instance there is no uniform fundamental law on financial institutions especially on holding financial company. Secondly there is no clear legal article on mixed financing and there is no fundamental change in existing single financing administration. Meanwhile local financial institutions under strict confine are incompetent to domestic and international competitions. Lastly other factors such as multiple supervising authorities and following coordination difficulty, improper internal control system and ambiguity in equity of state-owned banks are also barriers to mixed financing in China.Against mixed financing the third part put forward counter measures on financial legalization, financing supervision, financial institution reforms, monetary and capital market construction as well. As to financial legalization this part emphasizes on financial reconstruction. Market admittance, deposit insurance, privacy protection and financingsupervision should be incorporated in the new financial law. As to financing supervision the existing supervising authority on banking, securities and insurance should cooperate and coordinate with each other, they should effect administration as per the Basel Rules. As to financial institution reforms it should emphasize on ownership and internal controlling. This part also offers proposals about reforms on monetary market and capital market to assure due environment for financial institutions.