Comparative Study On Regulation Of Financial Derivative Markets In Shanghai And Hong Kong

Financial Derivatives refer to the emerging financial innovations accompanyingthe development of global financial market and matureness of financial systems. Asfinancial tools derived from traditional fundamental financial products, FinancialDerivatives are endowed with important economic functions which grant them adominant role in financial systems. Nevertheless, the regulatory systems governingFinancial Derivatives fall far behind the development of Financial Derivatives market.The accumulated risks might well pose potential threats to the security of globalfinancial market. Thus, it’s quite urgent to carry out researches exploring effectiveregulations on Financial Derivatives.This thesis, through investigations on the legal systems across Hong Kong andthe mainland, made a comparison concerning their regulatory patterns and systems.Meanwhile, with the help of this comparative analysis, we intend to reconstruct thelegal systems of Financial Derivatives market in China in view of the strengths ofthose in Hong Kong, further offering tentative suggestions on the regulatory systemsof Financial Derivatives market in China. However, the establishment of soundregulatory systems in accordance with the present Financial Derivatives market inChina should firstly based on the present market development reality. Meanwhile, weshould also draw lessons from the mature regulatory systems in current markets.Furthermore, we must improve, implement and specify regulatory legal systems,laying a solid foundation for standard trading activities. Detailed legal systems shouldcover Market Entry Certification System, Information Disclosure System, TradingSystems and Settlement systems, etc.