Study Of Credit Asset Securitization Legal Issues

Credit Asset Securitization refers to a kind of trasanction. In this transaction, a bank transfers its credit assets to a special purpose vehicle, and then the special purpose vehicle issues securities which were sold to investers through a securities-whole-sale underwriter. This trasanction is regulated by nearly all kinds of economic laws such as the contract law, the corporation law, the bank law, the securities law, the trust law, the real estate law, the accounting law, the tax law, the mortgage law, the bankruptcy law, etc.In order to understand the legal environment related to the credit asset securitization more easily, this essay narrates the general theories of the asset securitization in section one, which includes its concept, features, development states, participants, common patterns, basic course, principle, theory of originating.In U.S.A.,the origon of asset securitization, the flexibility of its precedental law systemprovides a suitable legal environment for the originating and developing of assetsecuritization. But the legal system of China is regarded as belonging to the continental lawsystem which has a statute tradition, and the rigidity and laggard of the statute bring a lot ofobstacles to the brand-new financing method—asset securitization. Besides, the legal systemof China is in a course of perfecting, so there are many contradictions among laws related toasset securitization, some asset securitization laws are even absent. The construction of assetsecuritization law system bases on a complete and clear understanding on the related laws. Insection two, the essay expounds the laws related to every phase of the asset securitizationtrasanction. The first phase is the preparation for the issue of credit asset backed securities. Inthis phase, the related laws include the law regulating credit asset, law regulating theestablishment of the special purpose vehicle, law regulating the transference of the asset, lawregulating the enhancement and rating of securities. The second phase is the issue and sale ofthe credit asset backed securities. In this phase, the related laws include the law regulating theissue and sale of securities. The third phase is the after-sale service and pay-off of the creditasset backed securities. In this phase, the related laws include the law regulating after-saleservice and pay-off of securities.