A Research On Introducing Market-making System Into China's OTC Market

The construction of the OTC market is important to complete the multi-level capital market system, and also the key link to drive the strategic transformation of China's capital market. The choice of trading system for the OTC market must be considered first at the initial stage of development. According to foreign experiences, there is a close connection between OTC markets and market-making system, and therefore the discussion of introducing market-making system into China's OTC market is of positive significance. This thesis which follows a progressive logical pattern makes an overall use of historical approach, comparative method and system approach to analyze the necessity and feasibility of transplanting market-making system as well as the practical way to implement it in the sight of law.The thesis consists of four chapters as follows:The opening chapter gives a general overview of market-making system and OTC market, including their conceptions and evolutions. It also defines the OTC market of our country, and analyzes both the limitation and breakthrough of market-making system. The whole chapter sets the stage for the research thereinafter.The second chapter traverses it is necessary and feasible to introduce market-making system into China's OTC market. On the one hand it expounds the benefits which market-making system will bring to the market and participants to clarify the necessity. On the other hand it points out that there is legislative support and practical basis for the introduction of this system. And the deficiencies in legal system, market maturity and supervision system can be overcome.The third chapter summarizes the market-making systems of NASDAQ in America and Emerging Stock Market in Taiwan, which mainly discusses the market maker's qualification and disqualification, related rights and obligations, and supervision measures. It provides some train of thought for the last chapter.On the base of chapters above, the fourth chapter makes the choice of market-making system clear. Comprehensive and concrete measures from legal standpoint are provided to help implement this trading system in China's OTC market.