“Governance System and Financial Security” Sub-forum of 2021 Annual Conference of Financial Street Forum Successfully Held

The 2021 Annual Conference of Financial Street Forum was convened in Beijing from October 20th to 22nd, and its sub-forum of “Governance System and Financial Security” was successfully held with Beijing Financial Court as the specially invited organizer.

The 2021 Annual Conference was themed on “Economic Resilience and Financial Actions”. Through its expanding scale of sub-forums, especially with the establishment of the Beijing Financial Court as an opportunity, the Conference has focused on the rule of legal protection for the financial sector, and added sessions and arrangements accordingly, so as to highlight the role played by the rule of law in serving and safeguarding the implementation of China’s financial strategies and promoting the high-quality development of the financial sector.

According to the reporter who attended the forum, the Beijing Financial Court is responsible for planning and organizing four sessions. In the session under the theme of “Peak Dialogue: Rule of Law Escorts High-quality Development of Finance”, heads of several agencies were specially invited to address the session, including the Legislative Affairs Commission of the National People’s Congress, the Supreme People’s Court, the Supreme Peoples Procuratorate, the Ministry of Justice, the Standing Committee of Beijing Municipal People’s Congress, etc.

“Since the reform and opening-up initiative was launched, the legal system for finance has gradually improved, offering a rule of legal protection for the stable and healthy development of the financial sector,” said Wang Ruihe, Deputy Director of the Legislative Affairs Commission of the National People’s Congress. The financial sector is an industry that requires thorough planning, tight regulation, and hard restrictions, and the financial reform and development need to be guided, regulated, and safeguarded by law. He stressed that financial legislation must firstly focus on the directions of financial reforms – marketization and rule of law, in order to reinforce the permeability and effectiveness of reform and promote the stable and healthy development of the financial sector. Secondly, financial legislation must focus on preventing systematic financial risks and strengthening the research on the extraterritorial application of financial laws, so as to safeguard national financial security. Thirdly, financial legislation should focus on quality and efficiency, so that the demand for legal practice can be met with more targeted and efficient legislation. Fourthly, financial legislation should adopt a systematic approach and reinforce coordinated and concerted efforts, so as to overcome the major and difficult problems and accelerate financial legislation.

He Xiaorong, member of the CPC Leadership Group and Vice President of the Supreme People’s Court, pointed out that people’s courts should fully leverage their function of financial civil adjudications, protect the legitimate rights and interests of various parties equally in accordance with the law, improve the securities class action system, and ensure the stable operation of the stock, bonds, and exchange markets legally. People’s courts should also give full play to their function of financial administrative adjudications, handle administrative cases involving financial regulators in accordance with the law, and substantively resolve financial administrative disputes. People’s courts should further improve the working mechanism for financial adjudications, build up a team of professionals for financial adjudications, and improve the mechanism for international exchanges and collaboration on financial judiciary. People’s courts should also enhance the coordination between financial adjudications and financial regulation so as to improve the diversified dispute resolution mechanism for financial cases. People’s courts and financial regulators should make contributions to the formulation and amendment of relevant laws and further develop China’s financial legal system.

Sun Qian, member of the leading Party members group and Deputy Chief Procurator of the Supreme People's Procuratorate said that for now and in a period of time in the future, procuratorial agencies should focus on cracking down on serious financial crimes and further aligning administrative law enforcement with criminal justice when it comes to preventing and defusing major financial risks. Procuratorial agencies should defend corporate rights and interests with the help of proper criminal policies, accurately differentiate crime and non-crime in financial activities, protect legal and compliant financial innovations in accordance with the law, and resolutely curb “fake innovations”. Procuratorial agencies should adhere to relevant criminal principles such as a balanced combination of leniency and severity, fewer arrests, and prudent prosecution and detention, and fully leverage the leniency system for pleading guilty and accepting punishment, so as to help companies involved to maintain normal operations as much as possible. Procuratorial agencies should also enhance the analysis of the deep roots of financial crimes, and prompt and support relevant departments to improve regulations in accordance with the law, so as to prevent crimes at an earlier stage and with more real results.

“More attention shall be paid to the systematic, holistic, and coordinated development of the rule of law in the financial sector, and the healthy and sustainable development of the sector should be guaranteed with sound laws and good governance,” said Liu Zhao, member of the leading Party members group and Vice Minister of the Ministry of Justice. He also noted that the reform and innovations in the financial sector should be safeguarded in accordance with the law to enable finance to better serve the real economy. The Ministry of Justice will work with the People’s Bank, China Banking and Insurance Regulatory Commission to draft the Regulations on the Supervision and Administration of Local Finance, clarifying the financial regulatory responsibilities of local governments and promoting the regulated development of local financial organizations. The relations between development and security should be balanced to defend the bottom line of avoiding systematic financial risks. Currently, the Ministry of Justice, together with the People’s Bank, is accelerating the review and formulation of the Regulations on the Administration of Non-Bank Payment Institutions to improve the regulatory rules for third-party payment institutions, prevent payment risks, and protect the legitimate rights and interests of various parties.

Zhang Qing, Deputy Director of the Standing Committee of Beijing Municipal People’s Congress, noted that Beijing, based on the “Two Zones” construction, emphasizes on the safeguarding role of rule of law and improves the local financial regulatory system to facilitate the development of the national financial management center and foster a modern financial sector that matches with the status of the capital of a major country. The Regulations on the Supervision and Administration of Local Finance in Beijing will be promulgated and implemented to address problems such as the objects of the “7+2+N” regulation, the code of conduct, the regulatory measures, risk prevention and handling, legal liability, etc. Meanwhile, the Regulations is formulated to regulate the operations of local financial organizations, unify city-wide regulatory indicators, strengthen the prevention and control of financial risks, promote the reform of Beijing’s financial regulatory systems, develop a full-fledged system for the prevention and control of financial risks, so as to further improve the functions of the national financial management center and advance the high-quality development of the capital’s economy.

The other three sessions held by the Beijing Financial Court are “the Legal Protection for Finance to Serve Real Economy”, “Legal Paths to Prevent Financial Risks”, and “Legal Cooperation on Two-way Opening-up of Financial Sector”. The three sessions are centered on three major tasks – preventing and controlling financial risks, serving the real economy, and deepening financial reform, and highlight the role played by the rule of law in consolidating foundation, stabilizing expectations, and benefiting the long run. More than 20 distinguished guests from the legal and financial sectors, the business community, and academia elaborated from multiple perspectives on the role of the rule of law in guiding and regulating the financial market, safeguarding against financial risks, and promoting financial innovation.

Cai Huiyong, Secretary of the leading Party members group and President of the Beijing Financial Court, said that the establishment of the Beijing Financial Court and the Beijing Securities Exchange has diversified the structure of the capital market, improved the system for financial governance, further promoted the function construction of the national financial management center, and injected impetus to and provided favorable conditions for the development of Beijing’s “Two Zones”. The sound legal system and good governance of the financial sector require the cooperation among various departments including the legislative, law enforcement, and judiciary departments, the inputs of scholars engaged in theoretical and practical research on the rule of law in finance, practitioners in the financial industry, and people from all walks of life, intensified two-way exchanges both at home and abroad, and active participation in the development of new international financial order. He hopes this forum will help strengthen consensus, promote the development of the system for the rule of law and governance of the financial sector, foster the synergy of governance, and facilitate high-quality development of finance.

The Financial Street Forum was founded in 2012. It is introduced that since 2020, the annual conference of the Forum has been upgraded to be a state-level, international professional symposium and was incorporated in strategic arrangements for the “Two Zones” and “Three Platforms” of Beijing. It has become an important platform and professional brand for high-quality development and opening up, and is known as the “vane of China’s financial reform and development”.