Shanghai Financial Court first issued the provisions on the testing Mechanism of Financial Market cases

Shanghai Financial Court first issued the provisions on the testing Mechanism of Financial Market cases

Source of information: Shanghai Court Network

2022Year7Month5On April 7, the Shanghai Financial Court held a press conference to issue the provisions on the case testing Mechanism of Financial Markets (for trial implementation) (hereinafter referred to as the "regulations"). This is for the Shanghai Financial Court to implement the policy requirements of the central government to support the high-level reform and opening up of Pudong in Shanghai to build a leading area for socialist modernization, to implement the strategic arrangements of the 12th Municipal Party Congress, to implement the relevant opinions of the Supreme people's Court, to respond to the demand for clear rules in financial reform and innovation, and to form an institutional system compatible with the financial reform and opening up in Pudong, Shanghai. Another innovative measure to provide judicial services for financial innovation and development. This press conference is the fourth in a series of "high-quality development of judicial services in Shanghai courts" and the third in a series of "innovative practices in specialized financial trials" of the Shanghai Financial Court. 

    According to the press conference, during the 14th five-year Plan period, China's economy and finance have entered the fast track of dual-cycle and high-quality development, and Shanghai has made efforts to create an upgraded version of an international financial center with deeper functions and more open systems. The Central Committee issued the opinions on supporting the High-level Reform and opening up of the Pudong New area and creating a leading area for Socialist Modernization, proposing to give full play to the role of the new free trade area adjacent to Hong Kong as a "test field" and further increase the intensity of financial opening up. we will promote high-quality reform and innovation in the financial market.2022Year1In April, the Supreme people's Court issued the opinions on the people's Court supporting and ensuring the High-level Reform and opening up of the Pudong New area to build a leading Zone for Socialist Modernization (hereinafter referred to as the "opinion"). It is proposed to "innovate the professional financial trial mechanism of the Shanghai Financial Court, actively and steadily explore the case testing mechanism of the financial market, and ensure the implementation of various financial innovation measures in accordance with the law."2022Year6Month22The regulations on the Development of Green Finance in Pudong New area of Shanghai also explicitly authorized "to support the Shanghai Financial Court to explore the case testing mechanism of the financial market, provide rules and guidance to the financial market, and serve green financial innovation".

2020Year7In April, the Shanghai Financial Court issued a number of measures to ensure the financial openness and innovative development of the new Hong Kong area of the China (Shanghai) Free Trade Experimental Zone, proposing for the first time to explore the establishment of a "case testing mechanism". In order to fully serve and ensure the high-level reform and opening up of Pudong in Shanghai and implement the requirements of the "opinion," over the past two years, the Shanghai Financial Court has thoroughly investigated the frontier issues of innovation and opening up in the financial field, learned from the best judicial experience abroad, and formulated and promulgated "regulations" in the light of the actual work of the court.

    The financial market case testing mechanism refers to the disputes that may be caused by financial institutions, counterparties and other subjects aiming at the typical facts and legal issues that are at the forefront of the financial business to be carried out or are in urgent need of legal clarity and have a significant impact on the financial market. apply to the Shanghai Financial Court for a case test, and the Shanghai Financial Court shall provide clear rules and guidance to the financial market through the hearing. The case testing mechanism follows the five principles of full consultation, openness and transparency, good faith, extensive participation and prohibition of abuse, stabilizes financial market rules and expectations, effectively guards against legal risks, and promotes "source governance".

    According to the press conference, there are five chapters in the regulations.28It mainly defines the definition, functional purpose, basic principles, initiation procedure, pre-trial procedure, case trial and supporting mechanism of the case testing mechanism.

    In the aspect of program startup, it defines the conditions and methods of starting the case test program. It is clear that the initiation of the procedure should be a financial civil and commercial dispute, the parties to the case must reach an agreement, the legal points involved in the case are specific, important and typical, and put forward higher requirements for the quality of the agent. and by the Shanghai Financial Court to examine and determine whether to start the case test procedure.

    In the aspect of pre-trial procedure, the procedural matters before the trial of the case test are stipulated. It is clear that the parties shall not raise objections on procedural matters except through consensus, and the collegial panel shall be composed of judges with rich experience in financial trials and experts in financial, legal and other fields, standardize the substantive debate right of the parties and the obligation to fully disclose evidence and materials, and allow individuals or organizations with specialized knowledge outside the case to publicly submit written opinions on the legal disputes involved in the case.

    In the case trial, it defines the trial process, evaluation, result declaration and effectiveness scope of the case test. Make it clear that the trial mode of the test case is the dispute trial mode; publicly announce the judicial opinion of the test case, and clarify the effectiveness scope and application scope of the case test results.

    In terms of supporting mechanisms, the provisions will make full use of information technology to improve the level of judicial science and technology in case testing; make and issue judicial suggestions on the typical problems found in the case test in time; strengthen the co-governance of financial justice and financial supervision.

    According to the press conference, as an innovative measure of the financial trial mechanism, the case testing mechanism has mainly carried out useful explorations in the following three aspects: first, the new scene of judicial service guarantee, which is different from the civil litigation system. The mechanism is based on the judicial service guarantee function of Chinese courts, fully draws lessons from the best practices of global financial justice, carries out tests and trials with reference to the principles of civil litigation, and forms a mechanism based on consensual initiation, comprehensive disclosure of evidence and materials, and preferred agency. full substantive defense, the full participation of all sectors of the community and other characteristics of the mechanism to stabilize the financial market. For the judgment logic and reasons formed in the test cases, the Shanghai Financial Court will refer to similar cases accepted later. Second, it is in line with the financial market regulatory sandboxie governance of the responsive judicial new attempt. In the existing legal rule system, the mechanism provides legal risk stress test for disputes that may be caused by financial innovation, provides clearer rule expectations for the innovation of financial market subjects in time, and controls the risk to a minimum range. consistent with the purpose and concept of financial supervision sandboxie governance. The third is to cooperate with all parties to achieve a new mode of dispute resolution of comprehensive social governance. The mechanism fully embodies the characteristics of openness, transparency and inclusiveness, and absorbs various forces to promote the process. The whole process of case testing is carried out under the supervision of the public, optimize the expert opinion support mechanism, and join forces such as financial regulatory agencies and industry self-regulatory organizations to promote the effectiveness of case testing.

    Xiao Kai, vice president of the Shanghai Financial Court, said that the Shanghai Financial Court will always take the implementation of the country's major financial strategic tasks as the traction, constantly innovate various working mechanisms for financial trials and serve the overall situation, provide a stronger financial and judicial guarantee for Shanghai's international financial construction to significantly raise its energy level and speed up the construction of a modern socialist international metropolis with world influence, and greet the 20th CPC National Congress with practical actions.