Research On Legal Problems With Risk Prevention For Commercial Factoring In China

According to the main business,factoring industry can be divided into two parts:Bank factoring and commercial factoring.In our country,the mainland bank factoring is not willing to provide factoring financing service for the small and medium-sized enterprises that need the factoring service because they are more willing to provide factoring financing service for large enterprises that have lower risk and more standardized management.Small and medium sized enterprises have not gained sufficient support from banking factoring that bring huge business opportunities for the differentiated competition of commercial factoring companies.Therefore,commercial factoring has an important significance to promote the development of small and medium sized enterprises in China as a new type of trade financing.However,some registered commercial factoring companies actually have no business because they lack of funds and is difficult to operate.At the same time,there are many gaps in the supply and operation of law norm.Our country should have a positive impact on the development of factoring business in China and perfect the law and regulations of commercial factoring in our country as soon as possible.We should improve the system of supervision and management and set up an enterprise's credit management system to create a good external environment for commercial factoring and promote the further development of commercial factoring in China.The thesis will get involved in four parts.In the first part,the author will elaborate overview of commercial factoring industry development,introduce concept,legal essence and development history of commercial factoring,as well as currently effective laws and regulations,and make a comparison on similarities and dissimilarities between bank factoring and commercial factoring.Also,the author will elaborate advantages of commercial factoring for market economic development,decompose the commercial factoring system via legal relationship,and analyze fundamental legal relations and rights and obligations of subjects in commercial factoring.Account receivable assigned will be the core of commercial factoring in the second part.The author will elaborate challenges and risks faced by account receivable assigned in commercial factoring from future account receivable assigned,prohibition of credit assignment appointment,right conflict of debenture transfer,and risks of credit assignment without informing debtors.The general factoring business includes two contracts—basic contracts and factoring contracts,which generally get involved in control law risks to be discussed in the third part.Last but not the least,some factoring business may get confused in borrow and loan contracts,especially for recall rights of creditors.The author also will discuss factoring business property with recourse and fully learn from overseas rules and system design.Due to late starting of commercial factoring business in China,it will be significant to analyze causes for overseas institutional rules and whether overseas rules will conform to China' s national situation,so as to further improve existing rules of China.