Research On The Rule Of Law Of Functional Financial Regulation In China

In recent years,the effectiveness of institutional regulation of our country has been challenged by the impacts of financial innovation and mixed operation.As a new regulation,functional regulation is an important way to make up for the insufficiency of institutional regulation and promote the reform of the regulatory system.In the reform of China's financial regulatory system,how to deepen functional regulation and promote the combination of functional regulation with institutional regulation is a key task in the reform of the financial regulatory system.Except for the introduction and conclusion,this article is divided into three parts with more than 40,000 words in total:Chapter one is why our financial industry should adopt functional regulation.First,the basic theory of functional regulation can be understood from three aspects: the definition of its connotation,the analysis of its characteristics and the interpretation of its value orientation.From the perspective of scientific definition of connotation,functional regulation is a regulatory model,rather than a certain regulatory method,in which the same or similar regulatory rules are established for financial products or businesses based on the basic function(industry)attributes of the products or businesses;from the perspective of characteristics,the primary characteristic of functional regulation is that the division of regulatory rights is based on the basic function attributes of financial products or businesses,focusing on the financial products or business activities provided by financial service providers,and the core element is to identify the financial products or business attributes in accordance with the requirement of substance over form so that identical or similar financial products or businesses are subject to equal or similar regulation;from the perspective of value orientation,functional regulation fully demonstrates the legal value of modern society,that is,fairness,efficiency and orderliness of the legal value.Secondly,the comparative analysis of functional supervision and the supervision of institutions in our country shows that functional supervision can effectively remedy the defects of institutional supervision in terms of supervision effectiveness,financial innovation,financial market competition environment,financial market unification and development,etc.Therefore,the introduction of functional supervision is of positive significance to the reform and practice of the regulatory system of the financial industry in our country.Finally,the adoption of functional regulation does not mean abandonment of institutional regulation.Both of them have their respective applicable situations and fields,and they coexist and coordinate each other for a long time.Moreover,functional regulation is only focused on individual products and market behaviors,which is difficult to achieve prudential regulation objectives,while institutional regulation is able to combine business regulation and prudential regulation.Therefore,in the reform of the regulatory system in the financial industry,institutional regulation shall play a leading role and functional regulation shall be supplemented.Chapter two,the status quo and existing problems of functional regulation in our country.First,from the perspective of legislative provisions,at present,there are three types of legislation related to functional regulation in our country.Second,from the analysis of the system of functional regulation rules in our country,we can find: first,there are three ideas for the formulation of functional regulation in our country: first,separate regulation is taken as the premise;second,functional regulation is carried out on the fields of "cross-institution and cross-industry and cross-business" in the financial industry;third,combination of institutional regulation and functional regulation is advocated.Second,the existing functional regulation rules mainly involve four institutional elements,namely,regulatory objectives,regulatory objects,regulatory focus and regulatory measures.Finally,as to the legislative expression system,China has adopted a three-tier standardized structure system of "principle provisions","general provisions" and "special provisions" in its functional regulation rules.Thirdly,there are the following defects in the practice of functional regulation in our country: the legal structure design of functional regulation rules is defective;there is a regulatory gap,high regulatory costs,and regulatory coordination mechanism is not effectively established,resulting in regulators facing the difficulty of inadequate regulatory effectiveness;and the difficulty of institutions under regulation that need to be regulated facing excessive regulatory burden as a result of accepting regulation by more than one regulator.Chapter three,the rule of law path for deepening functional regulation in our country.In order to adapt to the development and regulation of China's financial industry,on the one hand,we shall establish the general idea of deepening functional regulation,i.e.deepening functional regulation under the system of separate regulation in different industries,and meanwhile,combination of functional regulation and institutional regulation shall be adhered to.In particular,there are three specific measures for adhering to the combination of functional regulation and institutional regulation.First,in the regulatory link,we shall shift from the regulatory thinking focusing on market access to the continuous regulatory concept of "institutional regulation + functional regulation".Second,in the field of traditional regulation,we shall separately regulate the indirect financing market and direct financing market,with emphasis on the application of institutional regulation to indirect financing market,and strengthen functional regulation on the direct financing market under the premise of institutional regulation.Third,we shall focus on new types of regulated fields,adhere to the combination of functional regulation and institutional regulation and seek the balance between financial business innovation and risk management and control.On the other hand,we shall improve the legislation and implementation of functional regulation in our country through specific measures.The specific measures shall be taken in the following three aspects: first,we shall integrate the existing regulatory rules,establish a "Financial Entities Law","Financial Conduct Law",and "Financial Commodities Law" centered on the supervision and administration of the financial industry,and appropriately expand the legislative coverage of functional regulation,so as to provide legal protection for deepening functional regulation.Second,we shall reasonably allocate regulatory resources and establish a more effective regulatory coordination system,so as to overcome the difficulties faced by regulators in the process of implementing functional regulation.Third,we shall establish a unified financial regulation information system and a mechanism for coordinated inspection by regulators,so as to reduce the operating costs of those regulated,while improving the efficiency of financial regulation and safeguarding financial security.