Research On The Legal Regulation Of Charity-based Crowd-funding In China

With the vigorous development of the Internet finance,crowd-funding for the public welfare was emerged,combining the two seemingly contradictory aspects of "commercialization" and "public interest" together in one mode.Confronting with numerous disputes such as "LuoEr Event" and "Donating Event of International Students".The crowd-funding for the public welfare also brings opportunities for the transformation of China’s public welfare program.According to statistics,the proportion of the charity-based crowd-funding is as high as 80% in all of the fields of crowd-funding.Thanks to the promotion of macroeconomic and social background,the charity-based crowd-funding raised the momentum of development.At the individual level,the living standard of the ordinary class has far exceeded the level of material needs,the existence of a large number of idle funds and the spiritual pursuit are exactly in line with the operation and the foundation of the charity-based crowd-funding.At the social level,the transparency and credibility of charitable organization has shrunk sharply in recent years,spurring the public to donated in a “low” approach,which is provided by the charity-based crowd-funding.At the enterprise level,the modern sense of the enterprise is no longer only concerned about the value of their identifiable assets,but focusing on the impact of intangible assets,including goodwill.A large part of the participants of the charity-based crowd-funding are from the enterprise.Through the allocation of donations and other ways,the enterprises promote the complete and achievement of projects of charity-based crowd-funding.It is exactly the vigorous development of the charity-based crowd-funding demands that it has to be regulated in the framework of the law.Under the environment that everyone could do donating,the supervision can not be ruled out too.The first part of the thesis is The Overview of the charity-based crowd-funding.Firstly,the legal position of the charity-based crowd-funding.In the legislative process in China’s Charity Law,the distinguish between the "commonweal" and "charity" has changed for several times.Through the creation of "big charity" and "small charity",the Charity Law in fact intentionally blurs the boundary of public welfare and charity.Thus,there is less sense to distinguish the two.However,it is common for news reports and social comments to confuse the usage of commonweal and charity when it comes to the charity-based crowd-funding and the crowd-funding for products,individual donating and charity fund-raising.The paper defines the concept of the charity-based crowd-funding with the considering of both the extension and connotation,and clarify the the extension through distinctions among similar modes.Secondly,introducing the status quo of the development of the charity-based crowd-funding.Thirdly,distinguishing between the various types of models in the operation of charity.Aiming at the targeted analysis to different modes of the charity-based crowd-funding,the paper classify it according to the subject of projects.Fourthly,analysing the legal relationships in the charity-based crowd-funding in a detailed way.The essence of the legal analysis of the charity-based crowd-funding is to clarify the rights and obligations of different parties,and the key part is to sort out the legal relationships in the actual operation of the charity-based crowd-funding and make a foundation for the next step.The second part of the thesis is The Legal Risk and The Current Situation of Legal Regulations of the charity-based crowd-funding.First of all,analysing the legal risks of the charity-based crowd-funding,including the risks of illegal fund-raising,the risks of asymmetric information and the risks of policy changes.Second,sorting out the legal norms of the charity-based crowd-funding.At present,China’s charity-based crowd-funding law system has not yet been completed,which only can be found in some scattered normative legal documents and laws and regulations,such as Charity Law,some provisions of gift and intermediary contracts in the Contract Law,The Regulations on The Administration of Foundations,the proposals about the commonwealth marketalization from The Guidance of the State Council On Promoting Healthy Development of Philanthropy and etc.Charity Law has exerted certain influences on the development of the charity-based crowd-funding,and distinct the raising charity-based crowd-funding and relief donations indirectly,but The Charity Law failed to include the charity-based crowd-funding into the standard system,and is still hesitating in the dilemma of commonwealth administration,which put forward the requirements to make up the law.Thirdly,analysing the problems existed in the legal regulations of the charity-based crowd-funding.The legal risks symbolize as the information asymmetry,illegal fund-raising,policy changes,and the lack of legal norms is mainly reflected in the project evaluation system,the lack of standardized norms of rights and obligations,the lack of accountability,the lack remedial measures of platforms and punishment mechanism as well as the the unclear regulating boundaries of the charity-based crowd-funding.The third part of the paper is The Coordinating Principles of The Regulations on Charity-based crowd-funding.First,the coordination of the economic man and the moral man,namely paying attention to the instrumental value of non-altruism and the objective value of altruism.the charity-based crowd-funding is a typical combination of public and commercialization,it embodies the game between the economic man and the moral man.The essence of the economic person is the pursuit of self-interest maximization,while the moral person is the foundation of development of social public welfare undertakings.There are contradictions naturally.However,Adam Smith supposed that the two can co-exist.The regulating difficulties and the regulating directions should be set out from the balance.Second,the harmonic relationship between governments and public welfare organizations.the charity-based crowd-funding promotes the public welfare undertakings into the market competition,and achieve the economy evolution through the market-oriented economy,but without getting rid of the dependence of inertia.Thus,it is still a challenge to coordinate the relationship between the two and realize the free development of public welfare organizations.Third,the balance between the marketization of public welfare and public welfare administration.the charity-based crowd-funding is a significant link to accelerate the process of marketization of public welfare in China.However,there is a long tradition for China’s charity cause to administrated by the governments,the game between the marketization of public welfare and public security administration is the key to the regulations on the charity-based crowd-funding,and is also the focus for China’s public welfare undertakings to break through the traditional barriers.The fourth part of the paper is The Specific Suggestions of Legal Regulations On the charity-based crowd-funding.Regulations on the charity-based crowd-funding should focus on the following: to define each participants’ legality,especially the legitimacy acknowledgment of the platform and the project sponsor;to clear the rights and duties of each parties in the legal relationships and clarify the mutual restriction relations between participants;to clear the government’s regulatory limits;to improve the operation and management of public organization ability;to handle the enterprise the special problems of the raise;to build a better public environment for development and improve the supporting mechanism,such as social credit system and credit rating system.