On Transfer Of Trust Beneficial Right

As a flexible asset management system, trust has been widely used in common law countries. Trust system have been gradually introduced into civil law countries from equity based on their domestic legal system and given the needs of economic development. Since Trust Law has been promulgated in 2001, trust industry has been thriving in China. Although the trust asset volume managed by trust industry has reached 13.98 trillion by the end of 2014, the transfer of trust beneficial right is not going so well in our country. As trust benefit is derived from the interests of trust assets management and disposition, the ownership of trust asset and the nature of trust beneficial right should be clearly indentified in order to study the transfer of trust beneficial right. The author intends to analyze the above-mentioned questions and research into the problems of trust beneficial right transfer as well as make suggestions for relevant rules.The dissertation is divided into four parts as follows:The first part is an overview of the trust beneficial right. The author introduces the origin of trust benefit system with the purpose of explaining the reason for trust dual-ownership system in equity using the literature method, and to elaborate the trustee ownership attributes of the trust property in civil law system. And the creditor’s right attributes of trust beneficial right is explained in order to analyze the applicable rules for the trust beneficial right transfer and trust registration.The second part is on the justification of trust beneficial right transfer. The author explains the internal attributes of trust beneficial right transfer, compares the transfer system of trust beneficial right in different countries and elaborates the transfer model of trust beneficial right in China. Thus, it is concluded that there are internal conditions and external needs for trust beneficial right transfer. However, the lack of relevant rules not only limits the transfer of trust beneficial right, but also results in the risks along with the transfer.The third part is on the transfer rules of trust beneficial right, which uses the literature method and the method of law and economics, explores the issues in trust beneficial right transfer when lacking of detailed operation rules including:1. Transfer should be in writing form. It takes effect as the transferor and the transferee reach an agreement, the trustee’s counter should be in accordance with Arrival Theory. As to dual-transfer or multi-transfer situation, the arrival of notice attached with time certificate should be given priority, with the exception that the trustee has already assigned trust benefit to ordinary notice transferee. 2. Inheritance of Trust Beneficial Right. In this section, the exception cases of the trust beneficial right inheritance are elaborated, for instance that the inheritor does not meet the conditions which have been specified in the trust contract as the requirement to the inheritor; another example is discretion trust.3. In the trust beneficial right pledge, the author discusses that the nature of guaranty provided by trust beneficial right is right pledge. The pledge guaranty of trust beneficial right is incapable to be against the third party for lack of registration public system.The fourth part is on the transfer of trust beneficial right, using the literature method and the method of law and economics, discussing trust registration and transfer registration of trust beneficial right for there is no registration rule in China including:1. Trust registration shall follow the existing practice for property and right transfer registration, adding trust registration in the existing registration office and the registration system and adopting theory of Registration Effectiveness and Registration Antagonism respectively in accordance with the requirements of the change of ownership. In terms of the trust property whose change of ownership does not need to register, a unified platform for the online registration should be established and parties have right to decide whether to register. The investment registration platform of the trust beneficial right should be added on the trust beneficial right registration platform to create conditions for the transfer of the trust beneficial right.2. The trading parties apply for registration of trust beneficial right. The transfer of trust beneficial right should adopt theory of Registration and Public Exposure Principle, and the pledge of trust beneficial right should adopt theory of Registration Effectiveness.