Study On Legal Problem Of Collective Note

Small and Medium Enterprises(SME) are an important part of our enterprise to solve theemployment problem of the urban residents, make a significant contribution to China’s GDP,while in the future economic and social development, the role of small and mediumenterprises will become more prominent. With the arrival of the financial crisis, enterprisesworldwide,, including SME in china, are faced with the plight of financing, the non-standardcorporate governance, imperfect corporate structure, unsound internal rules and regulations,low credibility, obviously insufficient risk-tolerance make SMEs more vulnerable in theface of a crisis, and cause many SMEs go up. With this background, the country attachesgreat importance to the financing problems of SMEs, increasing liberalization of controls onprivate capital, strongly promote and improve the opening of capital markets, and under theauthority of the People’s Bank of China, China Traders Association creates the Small andMedium Enterprise Collective Note (SMECN) to resolve the plight of SME financing,according to the characteristics of SMEs, the financing situation, the business scope offinancial institutions and the function of the inter-bank bond market, based on the design ofSME collective bond. Since November13,2009, as of February22,2013, SMECN has beenregistered in105batches, involving manufacturing, agriculture, emerging technology,industry, culture industry, which makes a great contribution to solve the financing difficultiesfaced by SMEs, provides favorable conditions for the growth of SME. However, due to thecharacteristics of China’s special capital markets and legal environment, SMECN still existsproblems, such as the legal or not, designed contradictions, which also provides researchspaces of the theory and practice for this article.This article mainly analyses SMECN in the eyes of the law,through introducing thebackground, clearing the design object and purpose, analyses the concept and makes comparewith commercial paper, bank loans, bond financing and other related concepts according tothe definition of the Dealers Association, analyses the legal characteristics SMECN; After that,this article presents the condition, legal relationship, and compare with the similar system ofthe United States, South Korea and other countries, then we find the problems in systemdesign which conflicts with existing laws, contraries to the legal theory, and also in the bodyand run, at last provides suggestions for improvement, the continuous development of the SMECN.This article argues that the SMECN not security and we should regard the SMECN as thebeginning of improvement and development of our commercial paper financing system, sortto commercial note system, try to issue in the inter-bank bond market, go ahead by removingthe restrictions on true deal, basing on the experience of CP, SMECB, and use it as anopportunity to modify the Negotiable Instruments Law, the securities Act and financing law toresolve SME financing dilemma and provide legal conditions for the long-term developmentof China’s capital market and open solutions.