The Research On Legal System Of Quasi Public Trust

The Trust Law of People’s Republic of China has come into force in October 1, 2001, one chapter of which stipulates the system of charitable trust. However after years of development, almost none of the public trust in practice is in line with the provision in the Trust Law. The first Charitable Law has been publicized on March 16, 2016. It acknowledges that charitable trust is also called public trust. However there is still no operating rule in respect to approval procedure and tax preferential policies, which leads to the result that public trust has never undertaken the responsibilities to facilitate the public welfare. With the increase demand of domestic public benefit, there is some quasi public trusts coming out, even though few of them conforms to the Trust Law provisions of the public trust. But what we cannot deny is that this type of trust has certain public purpose. The emergence and development of quasi public trust is the positively response to the domestic public demand. However in reality quasi public trust is treated as a Collective Fund Trust with no corresponding preferential policies in support. It is not conducive to the development of quasi public trust, and not conducive to the development of China’s public welfare undertakings.Quasi public trust is a trust that contains public purpose and allows the existence of private purpose as well. Trust property will be operated within certain risk, and the property and income of the trust will be distributed between the public beneficiary and private beneficiary. In recent years, the rapid development of economy has increased people’s enthusiasm for public welfare. Due to the lack of domestic public welfare undertakings development, the domestic practice of trust for the quasi public trust increased. However this kind of trust is treated as a collective fund trust and didn’t enjoy any preferential policies for its public interests. Domestic scholars start to explore the concept and trust property of quasi public trust, and the legal basis for profit-making activities in nonprofit organizations. At present, the legislation of quasi public trust is still in the blank, but in practice has emerged more and more quasi public trust. Under this circumstance, the study of quasi public trust is very necessary to promote the mature development and change the reality of lack of exploration research.As a new model of public trust, quasi public trust is still on the way of adaption and is inevitably need space. The paper will continue to explore the legal basis for the development of quasi public trust and its engagement of profit-making activities and distribution of residual income. This article will be based on recent study of China’s public trust and analysis of status of quasi public trust in our public trust system, and justify the existence of quasi public trust. This paper will put forward suggestions on constructing the quasi public trust system by referring to foreign advanced experience.This paper is divided into four chapters.The first chapter starts from the development status of quasi public trust. By exploring the practice of different kind of quasi public trust and the study of domestic academic scholar and practice circle, the paper summarize the concept of quasi public trust and analysis its features. By comparing quasi public trust with public trust and private trust, the paper tries to distinguish quasi public trust.The second chapter introduces American split interest trust and British mixed motive investment trust. American split interest trust totally conforms to the form of quasi public trust as it also has two kinds of purposes. Even though British public trust is restricted to absolute public motive, but its investment has three different ways, including financial investment, program related investment and mixed motive investment. The fiduciary design of the mixed motive investment will be the reference of quasi public trust. The recent rise of the Low Profit Limited Liability Company is in the pursuit of low profit and the pursuit of social welfare. American scholars start a lot of studies on the low profit limited liability companies. This paper thinks the type of this company offers a lot to the quasi public trust, and moreover it bring a bold vision of the trustee as low profit limited liability companies perfectly comply with the need of reducing the management cost of trustee.The third chapter discusses the legal basis of quasi public trust engaging in business activities. Due to its property character and operation mode in practice, public trust is generally treated as a juridical person. This chapter mainly discusses that the non-profit legal person has its legal basis to engage in business activities as there is no prohibiting regulations from the very beginning. Almost all kinds of non-profit legal person around the world are practicing in the areas of profit making activities. In China, all the non-profit legal persons, including foundation, non-profit social organization and private non-enterprise legal person are more or less engaging in profit-making activities, which also demonstrates the quasi public trust engaged in profit-making activities is feasible. Of course, non-profit corporation engaging in profit-making activities will have some special operation forms, but the business operation is feasible and valid within the scope.The forth chapter combines the analysis of the development of quasi public trust and foreign similar system, put forward some construction suggestions in respect of the foundation, management, supervision and tax policy for the quasi public trust to serve as a modest spur to induce some other valuable contributions.