Research On The Legal Issues Of Bankruptcy Isolation Mechanism In Asset Securitization

As an innovative financing tool,asset securitization is becoming more and more popular these years.The key to a successful asset securitization transaction is the construction of bankruptcy isolation mechanism.The core elements of bankruptcy isolation mechanism lie in the realization of "true sale" and the construction of "SPV".However,at present,there is obvious lag in the relevant legislation in the field of asset-based securitization,which leads to many legal problems.Although the regulatory authorities have successively promulgated the “Measures for the Supervision and Administration of the Pilot Scheme on Securitization for Credit Assets of Financial Institutions”,and the“Administrative Provisions on Asset Securitization of Securities Companies and Subsidiaries of Fund Management Companies” and other rules and regulations to regulate the securitization business of assets,due to the low legal rank of these systems,there are contradictions between the provisions of SPV and the upper level law,and there is a vacuum in the legislation related to the true-sale,which brings many obstacles to the bankruptcy isolation mechanism.Among them,the lack of judgement criterion of true-sale and the independent legal status of special asset management plan is particularly prominent,which is also the main problem to be solved in this paper.This article will focus on the core elements of bankruptcy isolation-the real sale of assets and the construction of special purpose vehicle(SPV).The Author is intended to make suggestions on the judgement of real sale and construction of special purpose vehicles(SPV)through making analysis of China ’s existing legal system and practice and legislation and practice of other mature capital market.Firstly,this paper puts forward two key steps to construct the bankruptcy isolation mechanism of asset securitization,as well as the problems faced by the construction of the bankruptcy isolation mechanism in the legal context of our country.Then it analyzes the legislation and practice of bankruptcy isolation mechanism in asset securitization in China,and points out that the legal essence of the relatively new "double SPV" asset securitization structure in China is a guarantee financing arrangement,which deviates from the essence of asset securitization.Then through the investigation of the legal provisions of "real sale" and SPV in asset securitization abroad,the paper puts forward some suggestions to improve the bankruptcy isolation mechanism of asset securitization in China.Firstly,the connotation and recognition standard of real sale should be made clear through legislation,the legal subject status of SPV should be made clear,and the corporate SPV model should be explored.Secondly,from a longer-term perspective,the financial separation should be broken supervision of the current situation,to achieve a unified system supply.