On February 26, 2013, the China Securities Regulatory Commission (the “CSRC”), aiming to expand its asset securitization program and boost liquidity, published Provisions on the Administration of Securities Companies’ Asset Securitization Businesses (Consultation Draft) (the “Draft Regulation”) and sought public feedback on the Draft Regulation. The Draft Regulation would allow asset-backed securities to be created based on a wide array of assets and would lower the threshold for a securities company to engage in such business.
China launched a pilot program for securities companies’ asset securitization businesses in 2005. Since then, the CSRC had suspended the program during the subprime mortgage meltdown and the resulting global financial crisis. China re-launched its asset securitization program in 2012. Fewer than 20 corporate asset securitization projects have been approved by the CSRC to date, and the liquidity of asset-backed securities remains low. The Draft Regulation would lift certain restraints from prior regulations and provides guidance for the asset securitization industry.
A summary of the Draft Regulation follows:
1. Asset Securitization Business Under the Draft Regulation
The Draft Regulation would apply when a securities company, acting as manager of a special-purpose vehicle (“SPV”), obtains assets from an originator through a transfer or other means (e.g., setting up a trust) and issues securities that are paid from cash flows generated from the transferred assets. Under the Draft Regulation, in the event of a bankruptcy of the originator, the manager (i.e., the securities company), the custodian, investors in the SPV, or any other party involved, the SPV’s assets would not form part of the bankruptcy estate of any such person. The custodian would have to be a commercial bank, the China Securities Depository and Clearing Company Limited, a securities company that is licensed to serve as a custodian, or a custodian approved by the CSRC.
The Draft Regulation would expand the assets that can be securitized to include (i) property rights, including accounts receivable, credit assets, beneficial interests in a trust, and infrastructure income rights, (ii) securities, including commercial paper, bonds, credit derivatives, stocks, and equity derivatives, and (iii) real property, including commercial properties. In addition, cash generated from the securitized assets could be used to purchase new assets, which can be added to the pool of securitized assets. According to the Draft Regulation, the securitized assets could not be subject to any encumbrance (e.g., mortgage or pledge) or any form of limitation on the originator’s rights subject to minor exceptions.
To ensure the payment of all or a portion of the asset-backed securities issued by the SPV, the SPV could use various forms of credit enhancement. The SPV could issue different classes of securities, but all securities in the same class would be required to have the same rights and subject to the same risks.
2. Threshold Lowered and Further Restraints Lifted
The Draft Regulation would lower the threshold for a securities company to conduct an asset securitization business by, among other things, removing the minimum required net capital size and classified ratings issued pursuant to Provisions on the Classified Supervision and Administration of Securities Companies. Under the Draft Regulation, a securities company would be eligible to apply to conduct an asset securitization business if it has a securities asset management business license, is not subject to administrative penalties as a result of material violations of laws and regulations in the past year, and has the capacity to control risks effectively. The securities company would have the discretion to invest its assets or the assets of any collective investment scheme or fund it manages in the SPV.
The fact that an originator and a securities company are related would not preclude the securities company from creating an SPV and serving as manager of the SPV, although the securities company would have strict information disclosure obligations. According to the Draft Regulation, the manager would be required to disclose certain types of material relationships with the originator, such as ownership of over 5 percent of the originator’s shares, or vice versa, or any provision of underwriting and financial advisory services in the past three years. When one of these relationships is present, the manager and the originator would be required to implement a mechanism to deal with the conflicts of interests. The Draft Regulation would not limit the amount of a securities company’s (i.e., a manager’s) investment in the SPV or the ratio of that investment to the SPV’s total capitalization.
3. Liquidity Increased
One of the main purposes of the Draft Regulation is to increase the liquidity of asset-backed securities in the PRC. An asset-backed security could be offered through a public offering or a private offering. It could be offered to the public if it satisfied the following requirements:
i). the originator complies with laws, administrative regulations, its bylaws, and applicable national industrial policies;
ii). the amount of the asset-backed securities issued is RMB50 million or more; and
iii). the asset-backed securities are rated AA or above by two credit rating agencies.
An asset-backed security could be privately offered to institutional investors and qualified individual investors, with a limitation of no more than 200 purchasers.
The Draft Regulation includes provisions that would allow asset-backed securities to be traded on the stock exchanges, the inter-dealer quotation and transfer system of the Securities Association of China, the OTC trading markets for securities companies, and other exchange venues approved by the CSRC. An asset-backed security that is publicly offered also could be listed and traded on the stock exchanges and used as collateral for a repurchase agreement. In addition, a securities company could act as a market maker that quotes both bid and ask prices in an asset-backed security.
4. Simplified Review and Approval Proceedings and Regulatory Arrangements
A securities company must seek approval from the CSRC before issuing asset-backed securities. Compared to prior regulations, the Draft Regulation would simplify these review and approval proceedings. Under the Draft Regulation, a securities company would apply directly to the CSRC to offer a privately offered asset securitization product, without obtaining prior opinions from the stock exchanges. For a publicly offered asset securitization product, the CSRC would hold an expert hearing to review its feasibility.
The Draft Regulation would specify the respective responsibilities of the CSRC’s agencies, stock exchanges, registration and settlement institutions, and relevant self-regulatory organizations with regards to the asset securitization business.
If implemented, the Draft Regulation should help to boost China’s asset securitization business and facilitate capital formation.
Bingham’s securitization practice is widely recognized for its global market leadership. Our presence spans across the U.S., Europe and Asia. Members of our team have regularly been ranked as leaders in the practice area by Chambers Global, Chambers Asia, Chambers USA and IFLR 1000. We have been named 2013 Securitization and Structured Finance Law Firm of the Year by U.S. News & World Report and Best Lawyers and have represented issuers and underwriters on more securitizations than any other law firm in the U.S. in the past five years, according to Asset-Backed Alert and Thomson Financial. Our Capital Markets team enjoys Band 1 ranking in Chambers USA: America’s Leading Lawyers for Business and is the only Band 1 law firm recommended for both client service and commercial awareness.
中国发布新规草案，拟加快资产证券化业务发展
为发展资产证券化业务，提高资本流动性，2013年2月26日，中国证券监督管理委员会（简称“证监会”）公布了《证券公司资产证券化业务管理规定（征求意见稿）》（以下简称《规定》），并向社会公开征求意见。《规定》列明了可以证券化的基础资产的具体形态，降低了证券公司从事资产证券化业务的准入门槛。
中国于2005年开始了证券公司企业资产证券化业务的试点，之后，由于次贷危机以及由此带来的全球金融危机，证监会暂停了这一业务。2012年，中国重新启动了资产证券化业务进程。截至目前，证监会批准的企业资产证券化项目不到二十个，资产支持证券的流动性仍然很低。《规定》将取消此前规定设置的一些限制，为资产证券化行业提供指引。
《规定》主要包含以下内容：
1. 《规定》中资产证券化业务的定义
《规定》中的证券公司资产证券化业务是指证券公司以特殊目的载体（SPV）管理人身份，通过受让或者以其他方式（比如设立信托）从原始权益人获得基础资产，并且以该基础资产产生的现金流为支持，发行资产支持证券的业务活动。特殊目的载体是指证券公司为开展资产证券化业务专门设立的专项资产管理计划（以下简称“专项计划”）或者中国证监会认可的其他特殊目的载体。依据《规定》，原始权益人、管理人（即证券公司）、托管人、资产支持证券投资者及其他业务参与机构宣告破产的，专项计划资产不属于其清算财产。专项计划资产应当由商业银行、中国证券登记结算有限责任公司、具有托管业务资格的证券公司或者中国证监会认可的其他资产托管机构托管。
《规定》扩展了基础资产的范围，允许包括企业应收款、信贷资产、信托受益权、基础设施收益权等财产权利，商业票据、债券及其衍生产品、股票及其衍生产品等有价证券，商业物业等不动产财产。此外，基础资产产生的现金流可用于购买新资产，组成专项计划资产。根据《规定》，基础资产不得附带抵押、质押等担保负担或者其他权利限制，少数情况除外。
为保障专项计划发行的所有或部分资产支持证券的支付，专项计划可以采用各种信用增级方式。同一专项计划可以发行不同种类的证券，但同一种类的资产支持证券，享有同等权益，承担同等风险。
2. 降低准入门槛，放宽业务限制
《规定》降低了证券公司从事资产证券化业务的准入门槛，取消了净资本规模以及依据《证券公司分类监管规定》确定的分类结果等限制。根据《规定》，具备证券资产管理业务资格、近一年未因重大违法违规受到行政处罚、能有效控制业务风险等基本条件的证券公司均可申请开展资产证券化业务。证券公司可自行决定以自有资金或者其管理的集合资产管理计划、基金投资专项计划。
原始权益人与证券公司存在利益关系的情况下，证券公司仍可设立专项计划和担任管理人，但此种情况下担任管理人的证券公司负有严格的信息披露义务。根据《规定》，管理人应当披露与原始权益人之间存在的重大利益关系，比如管理人持有原始权益人5％以上的股份，或原始权益人持有管理人5％以上的股份，或管理人与原始权益人之间近三年存在承销保荐、财务顾问等业务关系。如果存在上述重大利益关系之一，管理人和原始权益人应当建立相应机制防范可能存在的利益冲突。《规定》不限制证券公司（即管理人）自有资金投资专项计划的规模和该投资占专项计划总资金的比例。
3. 提高流动性
《规定》主要目的之一是提高资产支持证券的流动性。资产支持证券可以公开发行，也可以非公开发行。公开发行资产支持证券，应符合以下条件：
i). 特定原始权益人生产经营符合法律、行政法规和公司章程的规定，符合国家产业政策；
ii). 资产支持证券实际发行额度不少于五千万元；和
iii). 资产支持证券经2家资信评级机构评级，且评级均达到AA级及以上。
资产支持证券可以向机构投资者或合格个人投资者非公开发行，投资者合计不得超过200人。
《规定》允许资产支持证券在证券交易所、中国证券业协会机构间报价与转让系统、证券公司柜台交易市场以及中国证监会认可的其他交易场所进行转让。公开发行的资产支持证券，还可以在证券交易所上市交易，并可以成为质押回购标的。此外，证券公司可以成为资产支持证券的做市商，为资产支持证券提供双边报价服务。
4. 简化审核程序和监管流程
证券公司发行资产支持证券，应当向中国证监会提出申请并获得批准。与之前发布的规定相比，《规定》简化了审批流程。根据《规定》，对于非公开发行的资产证券化产品，证券公司可以直接向中国证监会申请，无需事先取得证券交易所的论证意见。对于公开发行的资产证券化产品，中国证监会可以组织召开专家论证，对产品进行技术论证。
《规定》明确了中国证监会派出机构、证券交易所、证券登记和结算机构以及有关自律组织对资产证券化业务的职责。
《规定》的实施将有助于推动中国资产证券化业务的发展，促进资本的积累。
斌瀚律师事务所的证券化业务被公认为在全球市场上占有领先地位，我们的业务足迹遍及美国、欧洲和亚洲等市场。我们团队的成员多次被《钱伯斯全球》（Chambers Global）、《钱伯斯亚洲》（Chambers Asia）、《钱伯斯美国》（Chambers USA）和《国际金融法律评论1000》（IFLR 1000）评为证券化业务的领军者。我们被《美国新闻与世界报道》（U.S. News & World Report）和《最佳律师》（Best Lawyers）评为2013年“年度最佳证券化和结构性融资律师事务所”。根据《资产支持简报》（Asset-Backed Alert）和《汤姆森金融》（Thomson Financial）的统计，过去五年，我们代表发行人和承销商负责的证券化项目数量超过美国其他任何一家律师事务所。我们的资本市场团队荣居《钱伯斯美国》（Chambers USA）“美国最佳商业律师”第一梯队之列，并且是第一梯队律师事务所中唯一一家同时以优质客户服务和商业意识而获推荐的律师事务所。
This article was originally published by Bingham McCutchen LLP.