Study On The Legal System Of Separated Supervision Under The Trend Of Mixed Operation

With the integration of the world economy,the financial industry has also developed internationally.After China’s accession into WTO,the economy and finance will be affected easily by the influence and impact of other countries of the world.Taking a panoramic view of the world,you can see that,under the purpose of improving the international competitiveness,the mixed operation finance has become a trend where a lot of cross-operating financial institutions such as Financial Holding Company,Universal Banking and so on emerge in endlessly.To better the supervision and promote the development of financial groups,countries that take mixed operation model will generally take similar mixed supervision model such as Umbrella Supervision and Unified Supervision.Since CBRC(China Banking Regulatory Commission)is separated from PBC(People’s Bank of China)in 2003,our country has implemented separated operation and separated supervision model which the financial institutions are authorized only in their own fields and forbade the trans-trade cooperation.Separated supervision model is better to maintain financial security and stability,and to protect the legitimate rights and interests of financial consumers indeed.However,under the impact of mixed operation institutions such as Financial Holding Company,separated supervision model is not conducive to our country’s financial innovation and competition with international financial institutions.Thus,the author holds the idea that it is of great value to study the challenges faced by China’s legal system of separated supervision and to propose some corresponding perfect proposals under the trend of mixed operation.The first part of this paper focuses on the current situation of China’s financial mixed operation,including three aspects such as trans-trade cooperation among various financial institutions,prevalence of online finance and the existence of many Financial Holding Companies.Firstly,the author will discuss the trans-trade situationof various financial institutions from three aspects of cooperation between banks and security companies,cooperation between banks and insurance companies,cooperation between insurance companies and security companies.Secondly,the author will study on online finance situation based on the popular P2 P,crowd funding,the third party payment.Lastly,the author will analyze the status of Financial Holding Company from four categories: banking,investment group,industrial group and local government investment.The second part of this paper aims at studying the specific challenges faced by China’s separated supervision legal systems under the trend of mixed operation.There are three main challenges the author will introduce in the following.The first challenge is that,due to the absence of Financial Holding Company Law,regulatory gaps emerge and may lead to financial leverage risk,internal transaction risk,opaque risk and systematic risk.The second challenge is that the supervisory law of different institutions is different which easily leads to regulatory arbitrage and the system of ministerial meeting doesn’t work well.The third challenge is that the existing separated supervision legal system is not conducive to our country’s financial innovation and international competition.The third part of this paper is to summarize the international reference for the financial supervision reformation of our country after discussing the reformation history and scheme of the United States,the United Kingdom and Taiwan Region.The author thinks we should adjust the structure of financial supervision to reinforce the macro-prudential regulation,promote the coordination and cooperation of financial institutions,emphasize the protection of financial consumers and establish a comprehensive legal supervision system for financial market.The fourth part of this paper is to give some advices to the perfection of our country’s supervisory legal system.First of all,we’d better construct umbrella financial supervisory system and emphasize the supervisory status and coordination status of PBC to strengthen macro-prudential supervision.Secondly,our country should complement the regulatory gaps of Financial Holding Company,coordination of financial supervision and foreign financial institution supervision.Lastly,theauthor will discuss some supporting legal systems which are also very important for financial supervision including information disclosure legal system,market-withdraw legal system,firewall legal system and financial consumer protection legal system.