The Legal Supervision On QFII

With the global trend of the world economy,China’s capital market hasquickened its pace in opening to the outside. The QFII system brought some changesto the capital market in China and promoted the development of capital market afteradopted. However, in course of development there have also been some problems andnegative effects. Especially when increase quota, if not regulated, it may causeenormous financial risks, even bring a heavy blow to China’s capital market. In thegradual opening up of China’s capital market there are many supporting systemsneeded to improve, especially the legal issues which become even more noticeable.In this paper,by comparing the development of QFII system in Taiwan andKorea with that of mainland,through comparative studies, the author give some legaladvice that we should gradually widen the door to QFII to support their developmentand at the same time carry out strict rules to supervise and control so as to avoidfinancial risks. By improving the relevant laws and regulations, we can improve thedevelopment of the QFII system and promote the opening up of China’s capitalmarket.