Research On The Legal Regulation Of Smart Securities Investment Advisor

As a new business type in the financial field,smart investment advisor has faced many difficulties since its emergence.Norms and the rule of law are the ultimate basis for their stable and long-term development.Based on the basic theory of law,this thesis proposes legal regulation suggestions from the perspectives of compliance,algorithm,investor protection and supervision by integrating multiple disciplines.Part One clarifies the legal position of intelligent investment advisors in China.By referring to relevant discussions at home and abroad,it is made clear that the intelligent investment advisor is a derivative product of traditional investment advisor,with a high degree of intelligence,involving diverse subjects,fields and businesses.Then,in combination with China's actual development situation and the current legal system,it is clear that the scope of intelligent investment advisory services should cover asset management.As a result,intelligent investment advisor can be identified as an investment advisory business that use algorithmic models to automatically perform securities portfolio and provide investors with investment advice and asset management services.It is further analyzed that the object of intelligent investment advisor(algorithm model)in China has the property of tool,the operation of intelligent investment advisor is intelligent and the service of securities investment consultation is inclusive.Then it analyzes the operation mode of intelligent investment advisor from four processes:collecting information for portrait,creating an investment portfolio,conducting securities trading,and subsequent asset monitoring and rebalancing.Finally,it analyzes the various legal relations such as consulting,intermediation,trust,and supervision of intelligent investment advisors with operators,investors,and regulators as the core.Part Two discusses the legal dilemma of intelligent investment advisors in China in terms of compliance,algorithms,investor protection and supervision.At present,the Securities Law has prohibitive provisions on discretionary entrustment,leading to the unclear legal status and business scope of intelligent investment advisors;the New Asset Management Regulations have no specific provisions on license and qualification of"practitioners",which may easily induce chaos of buying,renting and even operating without license,and intelligent investment advisors that rely on intelligent algorithms are difficult to apply to the traditional dual licensing system.Due to the virtual nature of the Internet and the inherent defects of the algorithm,the investors' suitability evaluation is inadequate.The data black box is easy to negatively affect the scientific nature of the business,and the algorithm black box is easy to lead to the absence of supervision.Whether the legal personality of the algorithm model is enjoyed or not leads to unclear boundaries of the subject's liability.License restrictions,static tracking and risk assessment of customers,the high degree of professionalism of the algorithm model and prohibition of carte blanche make it difficult to fulfill the fiduciary obligations.The uneven business personnel quality,security guarantees and risk control systems of each platform,as well as the legal gaps in the protection of personal information in China all increase the risk of information leakage and the difficulty of protection.The cross-border nature of intelligent investment advisor business and the unclear responsibilities boundaries between various regulatory bodies in China are more likely to lead to cross-regulation and omission of supervision.The low efficiency and high cost of on-site inspection as well as the lack of technical support make it difficult for the traditional supervision system and method to cope with the development of the industry.Part Three puts forward specific legal regulation suggestions for China's smart investment advisors.China should conduct policy guidance and legal revision in stages and on a trial basis to gradually remove the barriers to carte blanche,adopt an inclusive attitude towards smart investment advisors,release asset management authority,conduct license issuance by classification,and initiate the electronic qualification certification system.The management of investor suitability should be strictly implemented.The construction of a standardized system of algorithms should be promoted and the operator's obligation to disclose algorithms should be strengthened.The responsibility of Research&Development designers and operators should be divided separately and the former should bear the liability for fault.Fiduciary duties should be deepened from the whole service process,and the investor information protection should be improved through information protection legislation and the establishment of internal systems of the platform.Finally,by establishing a new concept of collaborative,penetrating,technology-driven and relatively secure supervision,with geographical cross-border as the auxiliary,and capital management scale as the core,a hierarchical supervision system is constructed;then,by setting up an intelligent supervision system and using new technology to improve the supervision framework,the effectiveness of smart investment advisory supervision can be enhanced.