The Post-enactment Evaluation Of Small Loan Companies' Legal System

The post-enactment evaluation of legal institutions is considered to be an effective way to improve quality of legislation and promote design of institutions. The resolution of deepening reform made in the Third Plenary Session of the 18 th Central Committee of the CPC asking for establishing scientific indicator system and assessment standards, which needs to take specific actions. The new "Legislation Law" also provide a legal basis for the post-enactment evaluation. Therefore, it is very time to take empirical research on evaluation of legal institutions.The reform of rural financing system in China is a mandatory changing process dominated by government, which is characterized by the top-to-down developmental line and marketization of formal financial institutions. Small Loan Company is one of the results of the mandatory institutional reform of China and is developing and growing efficiently, but there are many problems exposed. As a “fictional product” of the new-round rural financing system reform, the actual optional conditions of Small Loan Company is rather closed to current rural financing system. Nowadays, the overall institutional development of Small Loan Company cross the country has been launched, so it is a necessity to evaluate the former legal institutions comprehensively. To take institutional evaluation on Small Loan Company is able to not only examine the validity of institutional supply and implementation effect of Small Loan Company institutions, also improve the supervision standards and operational efficiency and lower operational risk. Therefore, it is rather important to establish a comprehensive and scientific and impartial evaluation system for evaluating the Small Loan Company institutions. This paper is designed into three parts to evaluate Small Loan Company institutions.The first part refers to legislation evaluation, institution evaluation of economics, theories and methods of legal effect evaluation in China and aboard. This paper designs a l evaluation system including contents and effect of Small Loan Company institutions. The evaluation of institutional contents is concerning mainly the text quality of Small Loan Company legal institutions. The evaluation of institutional effect is concerning mainly if the institutional goal can be achieved or not and if institutional implementation can take an effect on social intervention. The evaluation systems have specific emphasis, in accordance with characteristics of Small Loan Company, clear and definite specific indexes of relevant evaluations.The second part employs the evaluation system to the institutions of Small Loan Company and find out:(a) the relevant institutions of Small Loan Company have the following problems: defect of illegality, deficiency of regulations, and lack of coercive force and operability and coordination between different institutions, i.e. designs of institutional contents are not reasonable;(b) under the current institutional arrangement, Small Loan Company is cornered by the sustainable development predicaments that are weak profitability, financing difficulty and etc., which leads to the poor institutional effects that cannot make Small Loan Company meet financing requirement of rural areas, intensify financial competitions and remit financial suppression.The third part based on the conclusions of the second part to reflect the institutional flaws of small loan company legal system. Combining the former conclusions, this paper takes a brief assessment of the respective institutional texts drafted by the China Banking Regulatory Commission and the People's Bank of China represent a new-round legislative trend, and proposes relevant specific framework mainly containing more scientific legislation and reasonable balance of interests of all parties, the introduction of target incentive system, supervision and restraint mechanisms.