On The Legislative Obstacles To Asset Securitization

Asset securitization is the forefront study for contemporary financial andlegal theory circles. China officially launched the pilot of the asset securitizationin2005, from when the legal aspects of asset securitization have attracted theattention of people who deal with the economic law. After the financial crisis, thelegal regulations on the asset securitization has been the focus for the people fromboth practical and academic fields, and people increasingly think that assetsecuritization should come into legislation. Based on such a background, thispaper offers the deep thinking on the legislative barriers to asset securitization.This article starts with the introduction of the basic content of assetsecuritization to analyze the concept, characteristics, basic principles andoperation process of the asset securitization. In addition, this paper analyzes therelationship between the financial crisis and asset securitization, and then comes toa summary and reflection to the role of asset securitization in the financial crisis.In next part the paper places emphasis on inspection in the key countries andregions’ legislative status on asset securitization, introduces in detail about thelegislative background and the legislation profile in such countries as UnitedStates, Japan, Korea and Taiwan of China, in order to find out these countries andregions’ common points on the asset securitization legislation. Based on the aboveanalysis, the writer summarizes by using induction of the legislation conditions ofthe asset securitization, which should consider on the necessity and feasibility.And the writer ends this part by pointing out that a country’s legislation time of theasset securitization is closely related with this country’s financial environment andmarket demand. Then the paper gives a brief introduction of the legislationprocesses of China’s asset securitization.The following part analyzes in detail the main legislative obstacles to China’sasset securitization, from the concept, time, technique to the generationmechanism of the law and legal technologies. With regard to domestic people still have different views on such issues as whether asset securitization will succeed inour country, how the asset securitization will develop because of the risk offinancial innovations. Concerning the aspect of legislative mechanism, assetsecuritization will have a difficult way to rapid development because of thefollowing problems: China’s market mechanism is not in perfect, effective demandis insufficient; there are less securitized products and so on. Thus pushing aheadon legislation will inevitably result in the legislative resources waste. Relate to theaspect of generation mechanism of law, we should reconsider the legislationfeasibility because of such issues as: the time of asset securitization pilot is short,it is difficult to provide a practical significance of the legislative basis resultingfrom the lack of the historical data, and the legal transplantation is facing to theadapting problem. As far as the aspect of legislative technology, to develop assetsecuritization law will face the difficulty that the other general law can not matchfrom both the structure and language technology.In the end, the paper puts forth some suggestions to get rid of theabove-mentioned obstacles to China’s asset securitization, including the measuresto promote the self-development of asset securitization, the measures to promotethe development of credit system and so on.