Reasearch On Protection Of Investors In Asset Securitization In China

Asset securitization, recognized as one of the greatest financialinnovation, emerged from the United States of America in the1970s. Ithas contributed a lot to the world financial market and has beenintroduced into many other countries. With its subtle system design, thecapital mobility has been improved, the choice for the investors has beenrich and the whole financial market has been modernized. Before thesub-prime crisis broke out in the USA financial market, people rarelyaware of the weakness and weakness hidden behind. But the investorssuffered a lot in the crisis, and lost confidence to the asset securitization.Asset securitization in China commenced later than countries likeUSA and Germany, pilot project of which officially started in March2005.After several years’ development, asset securitization has achieved stableprogress. Asset securitization’s development relies on Investors’ understanding and trust. Without this, the whole market will be fraud andbend to the law of jungle, harming Securities sponsors’ interests in theend.This article begins by stating the necessity of protecting investors’interests in asset securitization product, advocating the establishment ofinvestors’ interests in asset securitization product. The content will beillustrated into several parts below:The first part lists the problems. By analyzing the necessity ofprotecting investors’ interests in asset securitization product, the authorintends to reveal the hazard of lacking protection system for investors,thus, indicating the importance of protecting investors in financial marketdevelopment.The second part introduces the subjects and procedures of assetsecuritization. By introducing the complexity and systematicness of itspattern, the author intends to demonstrate to the readers with a clearerimpression of the legal relations mentions thereafter.The third part and the fourth part narrate the risks which assetsecuritization may encounter and the lack of protection system forinvestors’ interest in China for now. The article combines the features ofasset securitization products, and analyzes the potential market risks andlegal risks in the development of asset securitization in China.In the last part, by means of comparative law and case analysis, the author analyzes the experience and lessons of protecting investors’interest in asset securitization. Witnessing the current status and futuregoal of China, the author has offered several pieces of suggestions suchas unifying asset securitization legislation, innovating on SPV model,perfecting information disclosure regulations and right relief ways.