Legal Strait And Way-out Of Assets Securitization Of PPP Projects Income Right

In order to reduce local government debt and solve the problem of insufficient capital for infrastructure construction in the process of urbanization,PPP has been rapidly promoted and developed in China since 2014.By the end of January 2019,there have been 8,734 projects with an investment of 2,060.330 billion yuan in National PPP Comprehensive Information Platform Project Management Database.However,in reality,the social capital dose not participate in PPP projects actively as much as expected,and there are also many problems in the implemented projects.One of the important reasons is that the current PPP has not yet formed a sound and benign capital operation mode: in the internal operation capital mode,the capital turnover rate is low,which fails to provide adequate construction funds,making it difficult to complete the construction task normally in the construction stage.In terms of external capital operation mode,it fails to get through the exit path of project investment funds,which reduces the enthusiasm of social capital to participate in PPP projects.As for PPP projects,the capital gap is large in the construction stage,the cooperation period is long,the services provided are monopolistic to a certain extent,and the continuous and stable cash flow can be generated,so PPP and asset securitization are highly compatible and complementary in function with each other.Promoting asset securitization of PPP projects can effectively solve the above problems.At the same time,securities regulatory commission,the ministry of finance and other departments have issued regulations about the asset securitization of PPP projects.on the base of existing regulations about asset securitization such as "Regulations on the administration of asset securitization business of securities companies(hereinafter referred to as " Regulations ")",the legal environment for the PPP asset securitization has been basically mature with a corresponding legal basis.PPP involves both public and private interests,the asset securitization should comply with both general regulations issued by asset securitization regulatory authority such as securities regulatory commission and special regulations issued by PPP regulatory authority such as the ministry of finance.the processes are under the dual supervision of two types of institutions.There are several legal straits in the process of implementation from a dual regulatory perspective.By analyzing the concept of assets securitization of PPP projects and the legal relationship,we discover those legal straits: disputes over underlying assets,the lack of true sale standard,the uncertain function of bankruptcy isolation,the imperfect tax system and so on,which can be divided into three categories: the straits caused by the imperfection of laws and regulations about the asset securitization.For example,disputes over the legal nature of special purpose vehicle leads to the lack of the effect of risk isolation.the straits caused by the imperfection of laws and regulations about PPP.For example,whether the project company can entrust a third party operate the project or not.The conflict between the ministry of finance and the national development and reform commission as for this question etc.the straits caused by the incompatibility between PPP and asset securitization.For example,too much internal and external credit may affect the identification of the real sale.Due to the close connection with PPP project,the original owner generally continues to operate the project after the sale of PPP projects income right.It is difficult to differentiate the assets of the original owner from the assets of the special purpose vehicle.In view of the above difficulties,it is recommended to introduce future claims,determine its criteria for identification,clarify the time when its transfer takes effect,and improve its public registration system.It is recommended to improve laws and regulations to address the issues mentioned in the article from the three aspects of PPP policies and regulations,general provisions for asset securitization,special provisions for PPP asset securitization.It is recommended to improve tax regulations to address the issues mentioned in the article from the two dimensions of the operations of PPP project and the operations of PPP asset securitization.In addition,asset securitization has the functions of risk transfer.It can transfer the risk of PPP projects to other market entities,and quickly enlarge and transfer through leverage effect,thereby increasing market system risk,so it is also necessary to strengthen its guidance and supervision,especially to pay attention to supervision and management at the macro level and avoid exogenous risks.Through the above discussion,it is expected to have positive significance for the practical operation and theoretical research of asset securitization of PPP projects.