Research On FINRA Arbitration

Securities arbitration in America has a long history,which can dates back to the year of1817 in NYSE(New York Stock Exchange).Initially,securities arbitration was applied as a type of resolution only for disputes between the members of the exchange.Later,with the recognition of the Supreme Court,the applicability of securities arbitration extended to disputes between the members and the public investors.Then,the arbitrability went further,labor disputes between the securities dealers and its employees became arbitrable as well.On the other hand,numerous SROs(Self-Regulatory Organizations)began to establish forums for securities arbitration as NYSE has did,resulting in the status of diversified securities arbitration institutions,which is typical of early phase of American securities arbitration.Today,arbitration has become quite popular for disputes involving securities industry,instead of litigation.In 2007,on request of U.S.Securities and Exchange Commission(SEC),The Financial Industry Regulatory Authority(FINRA)came into existence.FINRA is the largest SRO responsible for the uniform regulation into the securities market,the establishment of it is the most significant organizational reform in securities industry since Securities Act of1933,which brings self-regulation of securities industry into a new era of more scientific and effective regulation.Meanwhile,as a part of FINRA,its arbitration forum adopts uniform arbitration rules,and involves most securities arbitration of America,marking the setting up of arbitration institutions transforms from diversification to unification..In addition,basing on the previous securities arbitration experience and maintaining a variety of reforms and innovations,FINRA arbitration has made remarkable progress,becoming synonym for American securities arbitration and playing an irreplaceable role to the stability and prosperity of American securities market.For the purpose of reference,this article will take FINRA arbitration as a sample to analyze American securities arbitration,to figure out its merits.Overall,this article will be divided into four chapters,and the synopsis is as follows:The first chapter is about the evolution of American securities arbitration.In this part,I make an introduce of pre-FINRA American securities arbitration first.The next is the analysisinto the internal conditions and external incentives of the establishment of FINRA arbitration.At last,I make a summary of the unification trend of American securities arbitration.The second chapter discusses the features of FINRA arbitration.It includes sophisticated arbitration rules,the concept of protecting minority investors,the efficient SRO regulation,and the supervision of SEC.These four aspects constitute the basic framework of this research.The third chapter is about the primary issues of FINRA arbitration.In this part,I select some issues regarding FINRA arbitration on which the academics as well as the practitioners highly focus to make a discussion,containing mandatory arbitration,the classification of arbitrators and the applicable law.To some degree,this part takes further the above-mentioned second chapter.The last chapter is concerned with the enlightenment we can acquire from FINRA arbitration.In this part,considering the current situation of China,I make four suggestions deriving from the advantages of FINRA arbitration.Firstly,enhancing the legislation of securities arbitration.Secondly,attaching greater importance to and keeping more concentration on industrial arbitration.Thirdly,setting up an unified securities arbitration forum.Fourth,specializing the rules of securities arbitration.