Legal Risk Of The Right Of Return On Assets Financing

Micro-loan Company has solved the financing problems of small and micro enterprises and has achieved accomplishments. The current problems of Micro-loan Company that it has difficulty in financing become very acute. For the purpose of solving these problems, the right of return on assets to finance small loans is trying its best to get over the obstacles but there are also some difficulties due to the lack of proof to establish the stage as well as the imprecise legal deduction. The legal nature of this product in legal positioning is unclear and it faces the risks of invalid and irregularities. By giving a brief analysis on the legal concept of the right of return on assets and properties, this paper clarifies the clear position as well as the role it plays in the legal system. By deducing legal logic of the product designing, this paper studies about the legal framework, the rights and obligations involved in study subject. Further analysis on compliance risk, usufruct transfer risk, and risk guarantees applicable law and bankruptcy risk isolation exerts a deep and profound influence on risk-aversion for the future product designing. And it can also bring the function of the small loan company financing into full play, which is beneficial for addressing the financing problems to a large extent.This paper is divided into three parts: the definition of the rights of return on assets, the current situation of the rights of return on assets, the legal structure of small loan asset financing and the legal risks involved in the transaction process.The first chapter conducts a study on the definition of the right of return on assets. At first, the paper introduces the concept of the right of return on assets, and then it leads to the theoretical concept of the right of return on assets and the legal nature of view which based more on " future creditor’s rights ", "t empower " and " the profit real right", the latter two of which are not in line with the principles of property law. The paper thinks that the determination on the nature of the right of return on assets should adopt the method of "future creditor’s rights ". By introducing the case of "Anxin Trust vs Kunshan Chungao", the paper explores the attitudes of judicial cycle.The second chapter introduces the current situation as well as the legal structure of the right of return on assets to finance small loans. Micro-loan Company has played a major role in solving the problems of the small micro business financing. But their own financing problems cannot be solved, the reasons of which lie in the aspects of both law and policies. In order to solve the problem, the local government and the Micro-loan Company industry have launched a series of practices, of which the right of return on assets to finance small loans is the ideal choice. The next chapters in this paper give a brief introduction, including the brief analysis on the legal structure of the small loans financing income right. After rearranging the publicly released information of the Exchange, the paper introduces the transaction process, including the legal structure and logical process of evolution. In addition, the paper makes a contrast among the financing side, the platform bodies and the rights and obligations of intermediaries. The author also comes up with the personal opinions on whether the rights are equivalent to the obligations in this paper.The third chapter is the most important one which discusses the legal risks and the corresponding response to these risks. From the perspective of the right of return on assets to finance small loans, legal risk transfer of the right of return on assets, secured financing legal risk, legal risk of bankruptcy, the paper illustrates the related information. In compliance risk, the paper makes a summary about the legal and regulatory environment where there is a lack of authority in legislative levels. Besides, the supervisory regulations are not inconsistent. From the perspective of the regulatory aspect, the regulators should focus much more on improving the current regulatory system instead of let it incorporated into the regulatory system of asset securitization. As for the legal right to transfer the risk of asset returns, the paper firstly discusses the legality of the right of return on assets, thinking that people should screen for the legitimacy of small loans and identify their transferability. In the section of secured financing risk, whether the pledge-style financing and the callable financing applies to Refinancing "security law" is under demonstration. Through demonstration, there is a big problem for the "security law" to directly apply. Finally, the paper also conducts a study on the issue of bankruptcy isolation. The paper also thinks that the risk protection mechanism is capable of reducing the risks, but future funding must take the issue of bankruptcy isolation into account. Besides, the research on the transfer of the fraudulent conveyance of bankruptcy isolation gives a brief analysis on the legal provision of Contract Law and Bankruptcy Law, holding that in the preliminary stage, the measures of bankruptcy isolation cannot be adopted. However, for the sake of its sustainable development, the measure of bankruptcy isolation should be introduced in the future.