On Our Country’s Real Estate Investment Trust Risk Of Legal Control

The origin of the real estate investment trusts (REITS) in the United States, due to itsability to effectively expand the financing channels for enterprises to meet the needs ofordinary investors for investment in the real estate market and reduce the financial risks ofcommercial banks, Japan, Hong Kong and other countries and regions the introduction of thesystem. China the system has been at the exploratory stage, the State Council approved thepilot cities of Beijing, Shanghai and Tianjin as the first batch of REITS in2009, approved thecity of Guangzhou as a pilot in2010, the practice of trust and investment companies havealso introduced a series of classes REITS products. Thus, we can predict, with the deepeningunderstanding of China’s theoretical circles and trust practice profession REITS, Chinalaunched a formal REITS has gradually become possible. In this context, this paper based onthe current development of our practice class REITS, drawing on the mature U.S. REITSlegislative experience on the basis of the risks faced by China’s launch of the class REITSwere discussed and tried to China REITS risk of legal the improvement of the control systemrecommendations.This article about27,000words, in addition to the preface and conclusion, the text ofthis paper is divided into four parts:The first part of the real estate investment trust and risk. The section first introduces theconcepts, legal characteristics and classification of REITS, and then on the developmentstatus of China’s practice in class REITS were analyzed and Analysis on the basis of itsexposure to risk in our development process.The second part is the present situation and problems of the real estate investment trustsrisk of legal control. That part of the first of our class REITS risk of legal control system arediscussed, specifically from the supervision of trust legislation and regulatory bodies, thetrustee qualification, and to raise funds, Capital Trust scheme of credit enhancement,information disclosure and the beneficial interest circulation market five to start and then theproblems of the current risk control mechanism.The third part is the control measures on the the REITS risk of legal and its significancein China. The part of the first the REITS risk of the legal control measures in the UnitedStates, specifically from the prudent investment rules in the United States, the regulatorysystem of the U.S. REITS Fund, U.S. REITS benefit from the preferential tax policies in thecirculation mechanism of the certificate and trust legislation in the four parts are expanded, and then combined the risk of running class REITS process exposed the U.S. REITS riskcontrol systems reference some of our country.The fourth part of measures to improve our country the REITS risk legal controlmeasures, which is the focus of this article. Based in part on the current development ofChina’s practice in class REITS, real estate investment trust risk relationship of the existingsystem analysis, pointed out that the missing and shortcomings of the current system is themain reason for its risks. Based on the combination of U.S. sophisticated risk controlexperience, our country the REITS risk of legal control measures put forward four proposals,specifically including the development of of REITS special legislation to strengthen internaland external supervision of trust companies, trust beneficiary certificates of the distributionmarket and The introduction of the four aspects of the prudent investment rule.