China Warrants System Of Legal Issues

After more than ten years of development, the Chinese securities business has established its important roll in economic development, while the problem of simplification of the product of securities business becomes the embarrass of the development of the market. At the same time, owing to the downturn of the securities business, not only the investor lost a lot, but there is great risk in the whole market. In this situation, the exploitation of the new sort of finance product, the instruments, by which the investor can elude the risk of investment and profit, become the focus of scholar and relative people. The author try to testify, warrants is possible in China from the aspect of law, and put forward some suggestion in detail, how can we put it into practice.The article insists of five parts:In the first part, warrants will be introduced in summary, which includes the concept, elements, categories, characters of the warrants, and the compare with other financial instruments. Moreover, the develop history of warrants , the actuality of relative countries and the risk of investing in warrants will be integrated into the explanation, which is about the economic character of warrants and its effect. This part is also the base of other parts.In the second part, the comparative analysis of legal theory on warrants will be referred. At first the legal character of warrants will be clarified, in fact it is legally a selective contract, though it was designed as a financial product. Furthermore, the legal character of the right to purchase shares, the elements, subjects, rights and duties, legal relations of the right to purchase shares bargain will be further analyzed. Secondly which legal roll the warrants has played will be related, and the conclusion, that warrants is securities, will be deduced from the essential analysis of warrants. Thirdly the system of warrants, such as the qualification of the subject, condition of issuance, trading rules etc. will be discussed, in order to bring forward the gist, which can be consulted in the actualizing of warrants. In the third part, warrants is necessary. Firstly the Chinese history and the practice of warrants will be introduced, and analysing unsuccessful reason in warrants project, manipulating warrants prices, lack of investors'knowledge etc. Secondly the significance of actualizing warrants in current situation will be discussed, and the main content will compose of following parts: the character of warrants, issuing bonds in listed company, refinance of listed company in the situation in which the right of share will be distributed, the system which aims to make the shares of listed company fully circulate and inspire the manager.In the fourth part, the current legal surrounding of actualizing the system of warrants in China will be discussed. The problems which exist in the application of law will analyzed mainly according to the company law and the securities law, and the suggestion how can we resolve them will be presented.In the fifth part, the advices and conceives about the actualizing of warrants in China will be brought forward. And the advices, which mainly base on the Chinese experience and foreign legal rules of warrants, will refer to the exploitation of sorts of warrants, the qualification of issuing subject, the issuing conditions, trading rules, revealing of information, controlling and supervision of risk.