Research On Rights Protection Of Perpetual Bond Investors Of China

Perpetual bond is a new type of financial instrument that has developed rapidly in the market in recent years.Because it has both debt and equity,it is often referred to as "the name of a bond and the nature of equity",and it is a hybrid debt instrument.Recently,there have been successive renewal and interest deferred payment events for domestic perpetual bonds,and the issuer has failed to pay the principal and interest as scheduled.In the past,related domestic research mainly focused on the issue of perpetual bond issuance effects,accounting treatment,and issuance pricing.There was a lack of in-depth research on the potential legal risks and investor protection of perpetual bonds,and the latter focused on maintaining the stability of the perpetual bond market.Protecting investors' rights and interests undoubtedly has important practical significance.The first chapter is an introduction to the status quo of the development of perpetual bonds and the deep analysis behind the renewal and deferred interest payments.First of all,the development history and current situation of perpetual bonds outside China and China are introduced.Perpetual bonds outside the country are dominated by commercial banks,while perpetual bonds in China are dominated by non-financial corporate perpetual bonds.At the same time,in China,perpetual bond is not an independent bond,but is a collective term for all types of bonds that can be extended or have no fixed repayment period with redemption rights.The first perpetual bond in China is the “13 Wuhan Metro Renewable Bonds” launched byWuhan Metro in 2013.According to different regulatory agencies,perpetual bonds are divided into perpetual corporate bonds,perpetual medium-term notes and perpetual bond company bonds.Among them,Perpetual Tickets accounted for the vast majority of the market in terms of number and scale of issuance.Secondly,the current renewal and deferred interest payment events in China's perpetual bond market are sorted out and summarized,and the underlying reasons behind the incident are analyzed.It is found that the deterioration of the issuer's main qualification is its renewal and deferred payment Incentives.The second chapter focuses on the risks faced by perpetual bond investors in accordance with the terms.On the premise that the deterioration of the issuer's principal qualification is the main reason for renewal and deferred interest payment,the source basis of the above-mentioned behavior of perpetual bond issuers is further explored,that is,the special terms of perpetual bonds are analyzed.Due to the special terms of perpetual bond,it meets the needs of the issuer in accounting for it to be included in equity instruments.However,in terms of legal nature,perpetual bond does not meet the definition of equity,which is essentially a contractual debt and a form of bond compliance.Requirements.Based on this,based on the premise of private law autonomy and respect for the meaning of the contract,the perpetual bond clause serves as an important basis for adjusting the relationship between the rights and obligations of the two parties.However,the special terms of perpetual bonds fail to fully match the rights and obligations of investors and issuers.Therefore,compared with ordinary bonds,perpetual bonds investors will face special risks.First,it is difficult for investors to claim maturity and repayment.The second is the lack of investor protection clauses.In the third chapter,when it is difficult to claim due payment of principal and interest according to the terms,it further analyzes the obstacles that perpetual bond investors face in order to withdraw legally.At the level of contract rescission,although the first case of perpetual bond contract rescission provided a certain reference,the case is peculiar to the case and does not have the effect of universal promotion and application.First of all,for investors,the purpose of a perpetual bond contract is to obtain the economic benefits of fixed income and debt repayment.The issuer's breach of the obligation to disclose information does not necessarily result in the inability of the purpose of the contract.contract.Second,if investors apply the expected cancellation of default,they will face unclear standards and difficulties inproof.It is necessary to prove that the issuer's multiple objective actions reflect the deterioration of the subject's qualifications and the decline in debt repayment ability,so that the principal and interest cannot be repaid.At the same time,investors also need to urge the issuer whether to provide performance guarantees in order to release the withdrawal.At the level of bankruptcy liquidation,perpetual bond investors cannot prove that their claims have expired and cannot be repaid,and they do not meet the requirements for bankruptcy applications.Therefore,perpetual bond holders cannot initiate bankruptcy proceedings on their own initiative and can only wait for other creditors to initiate bankruptcy proceedings.The fourth chapter is based on the full-text demonstration and analysis,and the existing laws and regulations and regulatory policies are relatively unclear.Investor protection still has certain shortcomings and deficiencies.In light of the risks that perpetual bond provisions bring to investors,and on the premise of respecting the characteristics of perpetual bond,reasonable restrictions are added to improve and optimize the perpetual bond provisions;in response to the issue of barriers for investors to exit,actively explore judicial paths,Expansion of the standards for judicial recognition by introducing accounting factors.On this basis,the supervision of perpetual bonds should be strengthened,and protective measures should be taken from the source to minimize the inflow of perpetual bonds of poor quality into the market.Eventually,a perpetual bond investor protection system with three dimensions of private law,justice and public law will be formed to promote the stable development of the domestic perpetual bond market.