Research On The Legal System Of The Debt-equity Swap For Financial Creditor Under The Bankruptcy Reorganization

The debt-to-equity conversion in bankruptcy reorganization originates from the equity transfer of company shareholders.The provisions of China’s "Company Law" concerning the transfer of equity are the basic legal norms for the conversion of debt to equity.With the changes in the internal and external operating environment,under the pressure of high investment,high debt,high leverage,and high burdens leading to high risks,the current market-oriented debt-to-equity swaps is changing from the business model of the main provider of funds to the business model that mainly plays the role of financial intermediary.In the current financial environment,the goal is to stabilize growth,promote reform,adjust structure,and prevent risks.In order to alleviate the risk of non-performing assets of financial institutions and alleviate the temporary difficulties of business operations,and in order to cooperate with the country’s "three go,one reduction,one supplement policy",to promote the optimization and upgrading of the industrial structure,debt-to-equity swaps are implemented for enterprises facing bankruptcy reorganization.The debt-to-equity swaps in restructuring has optimized the debt situation of enterprises and mitigated the risks of financial institutions.However,due to the deficiency of relevant legal systems,there are still some problems in the process of the debt-to-equity swap,such as incomplete legal system,lack of market rules,huge scale of enterprise restructuring assets,shortage of clean-up funds and so on.In this regard,this paper studies some typical cases of debt-to-equity swaps in bankruptcy reorganization and puts forward the main legal issues involved in the case,discusses related legal disputes and analyzes them,expounds and analyzes the legal dilemmas of financial creditors in debt-to-equity restructuring in the process of independent decision-making,equity withdrawal,and debt-to-equity swap agreement signing.Finally,put forward suggestions on the optimization of the legal system for debt-to-equity swap in bankruptcy reorganization,on how to connect the legal system of debt-to-equity swap with other legal systems,how to reduce and even eliminate the legal system obstacles in the process of financial creditors’ debt-to-equity swaps,to avoid debt repayment risks of bankruptcy reorganization enterprises,and to reduce systemic financial risk.The first chapter of this paper clarifies the typical case of debt-to-equity conversion in bankruptcy reorganization and puts forward the main legal issues involved in the case,and analyzes and evaluates the relevant legal disputes in the industry.The second chapter elaborates and analyzes the legal dilemma faced by financial creditors in the debt-for-equity restructuring.Chapter III puts forward suggestions for the optimization of the legal system for debt-to-equity swaps in bankruptcy reorganization.And finally makes a summary.Through the improvement of the relevant legal system of debt-to-equity conversion,reduce the conflict of interest between financial creditors and other reorganization participants in the situation of bankruptcy reorganization.Improve the implementation efficiency of the debt-to-equity reorganization plan through the better connection between the debt-to-equity swap laws and the bankruptcy law and financial regulatory regulations,and reduce the risk of inaccurate disclosure of corporate finance and other information,as well as hidden financial risks that pose risks to system finance.By restructuring the improvement of the legal system for debt-to-equity swaps,the legal dilemma faced by financial creditors is reduced or even eliminated,which is extremely important in the current bankruptcy system environment of corporate salvation.In the process of formulating,negotiating,voting and revising the restructuring plan and the equity withdrawal at the later stage of the implementation of the plan,the debtors faced by financial creditors maliciously delayed the progress of the reorganization plan,the online voting system is not perfect,the online information publishing platform is not transparent enough,and the law is not detailed enough,the problem of inadequate legal system connection.Initiate amendments to bankruptcy regulations,corporate regulations,financial regulations and debt-to-equity laws,and strengthen the link between them,and the coordinated connection between the legal systems will get rid of the difficulties of bankruptcy restructuring enterprises and achieve a win-win situation for financial institutions and enterprises.It is of great significance to finally realize the purpose of constructing new financial ecosystem and reduce systemic financial risk.