An Insight On The Institutional Arrangements Of Financial Services Trade Liberalization In China

In the 21st century, the most notable trend in global economic development is integration. The liberalization of financial service trade has caused fervent concern. Because of its vulnerability, attitudes towards opening of financial service industry are, so far, doubly cautious. Not until 1997, "Agreement on Financial Services" was signed, has the liberalization in financial service trade embarked on a standardized track.Of course, the full realization of liberalization in financial service trade depends on a variety of factors, but it is undeniable that the role which legal documents play in this process is irreplaceable.In the level of international law, the multilateral legal regulatory system about liberalization of financial service trade is composed by "GATS", "The annex on financial service", "The second annex on financial service", "Commitment on the understanding of financial service" and "Agreement on Financial Services". They establish the tenet of gradual liberalization and the framework of negotiations, point out the direction of development, offer a restriction to the commitment made by members in the form of law, as well as provide a strong secure to the all-sided and orderly liberalization in financial service trade .In the level of domestic law, a country's legal system for financial service is not only a concentrated expression of the country's achievement in opening of financial service industry, but also the secure to a smooth realization of financial service trade liberalization and a stable growth of the national economy.This paper starts with the meaning of financial service trade liberalization; introduces main elements of international agreements related to it; under the framework of WTO, analyses various effects of it; constructs a model of Game Theory with the aim to prove that the legal documents play an invaluable role in the process of financial service trade liberalization; compares China's commitments in financial services sector ,which were made when its entry to WTO, with its legislation in this field; introduces the country's current situation in liberalization of financial service trade and calculates the opening degree in financial service industry from 1997 to 2006 in order to find out the gap compared with developed countries. And the author also introduces the legal system for financial Services in United States and the EU, with the aim to learn from successful experiences.Finally, conclusions have been reached that China has fully achieved commitments made in the field of financial service, but the existing legal system for financial service still has some drawbacks in the aspects of market access, national treatment, financial supervision and exit mechanism .And we can improve our financial services legal system in four aspects. Firstly, make full use of the legal system under WTO framework to provide reasonable protection for the domestic financial services institutions; secondly, improve the international competitiveness of domestic financial services enterprises; thirdly, strengthen the supervision over foreign financial services agencies; fourthly, perfect the market withdrawal mechanism for financial institutions.