Researches On The Problem Of Validity Of Valuation Adjustment Mechanism

"Validity of Valuation Adjustment Mechanism" is a dynamic adjustment mechanism of equity investment price.According to the realization of the business objectives,promised by the financing party,it arranges the rights and obligations of each party.Since the emergence of VAM,there has been a constant controversy about its effectiveness.The legal relationship between the parties is complicated and comprehensive,as invalid theory and effective theory are too absolute.We have to analyze the VAM of force of law in particularly.Firstly,the article elaborates the legal characteristics of the VAM.Through the analyzing different types of the VAM,we can see that the legal structure and emphasis are distinguishing.Then,by dissecting the judgment ideas,we found that it is not convincing to distinguish the validity of gambling agreement between gamblers.As long as it does not violate doctrine of capital maintenance,the legal validity of VAM should be recognized.Finally,for judging the validity of VAM,I try to construct the rules from the practice of judgment.On the one hand,we should follow the principles of balancing the Interests of Investors,Companies and Creditors,promoting the development of private equity industry.For another,the validity of clause of VAM is depending on specific agreement.We should go back to specific cases and contents of the Agreement.