Financial Group Transaction Supervision Legal System

With the globalization of economy and increasingly heated financial competition,financial institutions which break through traditional business scope, supply variousfinancial services has become an international trend. Financial conglomerates canbring economy of scale and synergetic effect, meanwhile, it also bring many badeffects, especially risk diffusion and risk contagion. Therefore, internationalcommunity formulated strict supervisory regulations for intra-group transactions. At present, financial conglomerates have been a matter of fact in China.However, we still not establish sound supervisory regulations for intra-grouptransactions. Therefore, in order to regulate the development of financialconglomerates and prevent the operational risks, this dissertation focuses on thesupervision of intra-group transactions. This dissertation consists of four parts and themain contents are as follows: The first part discusses the basic theories of financial conglomerates, includingits definition, modes, characteristics, and development trends. Then the dissertationintroduces intra-group transactions problem, and analyses its development reasonsand risks. The second part introduces the supervisory legal system of America, EuropeUnion, Joint Forum etc. applying comparative research methods. According to theabove-mentioned supervisory measures, the author points out what we can use forreference. The third part deals with the present development situation of financialconglomerates and intra-group transitions. The dissertation points out there still nospecial law for the supervision of financial conglomerate. We can see somesupervisory measures in different banking laws and regulations, but the soundsupervisory system has not been established. Therefore, our country is necessary toestablish supervisory regulations according to our country's practical condition. The last part discusses the author's proposition of establishing supervisorysystem for intra-group transactions of financial conglomerates in our country. Theauthor suggests we shall abide by the principles of public disclosure, procedureimpartial, and relieving supervisory load. We can draw lessons from internationaladvanced measures, such as firewall, transaction limits, public disclosure etc. At last,we shall also consummate and substantiate related laws and regulations.