Introduction to the China Securitization Forum. February 4, 2016

Transcription

1 Introduction to the China Securitization Forum February 4,

2 Table of Contents

3 Table of Contents

4 1. Overview of the Forum (1) Basic Information (7) Development Model of the Forum (2) (3) (4) (5) Establishment of the Forum Main Achievements of the Forum Reorganization of the Forum Core Purposes of the Forum (8) (9) (10) The Organization Chart of the Forum The Three-Tier Hierarchy of the Executive Bodies under the Meeting of Members Types of Membership in the Forum (6) Duties of the Forum (11) Rights and Obligations of Members 4

5 (1) Basic Information Name Website 中国资产证券化论坛 China Securitization Forum ( CSF or the Forum ) A non-governmental, non-profit permanent project (only engage in professional and academic exchange activities. ) Nature Offices Headquartered in Beijing Beijing Head Office New York Office London Office Meeting of Members and all Executive Bodies Organizational Bodies Members Institutional members and individual members from domestic and overseas securitization, structured finance and related capital markets 5

6 (2) Establishment of the Forum Bank of China CITIC Trust Co., Ltd. Morgan Stanley Asia China Chengxin International Credit Rating Co., Ltd. Deloitte Touche Tohmatsu CPA LLP Standard & Poor's Information Services (Beijing) Co., Ltd. China Construction Bank HSBC in Hong Kong Standard Chartered Bank (Hong Kong) Limited China Development Bank King & Wood Mallesons The Royal Bank of Scotland China International Capital Corporation Limited (in alphabetical order) Moody's Asia Pacific Ltd. Zhong Lun Law Firm 6

7 (3) Main Achievements of the Forum 1. July 2006: the Forum held a seminar on the securitization of credit assets; 2. October 2006: the Forum held its first annual conference; 3. March 2007 to March 2008: at the request of relevant regulatory agencies, under the auspices of the State Council, the Forum drafted and released a technical legislative draft for a national asset securitization regulation (to date, the Forum has prepared ten iterative drafts in Chinese and English); 4. November 2008: the Forum and IMN jointly held the Second Annual China Structured Finance and Real Estate Summit (IMN is an international organizer of institutional finance and investment conferences); 5. December 2012: the Forum held an international closed-door seminar on structuring asset-backed notes in the form of special-purpose trusts; 6 November 2013: the Forum and other relevant domestic and overseas institutions jointly held a closed-door seminar on revolving asset purchase structures and off-balance-sheet issues relating to asset securitization; 7 February 20 to 21, 2014: the Forum held its annual China Securitization Summit in Beijing; 7

8 (3) Main Achievements of the Forum 8. April 23 to 25, 2014: the Forum and the China Capital Markets Institute jointly held a financial asset securitization seminar in Shenzhen. 9. March 23 to 25, 2015: the Forum hosted its 2015 annual conference in Beijing. During the conference, the Forum signed CSF Consensus Statement and Strategic Cooperation Memorandum with the Structured Finance Industry Group ( SFIG ), and established a strategic cooperation partnership with SFIG. Also, the Forum hosted China Securitization Forum Annual Awards event to commend innovative projects in the China securitization and structured finance sector in March 2015: the Forum established its WeChat official channel, to publish CSF s important news, transcripts of speakers in its 2015 annual conference, etc. 11.August 2015: the Forum and the Financial DreamWork jointly held the Securitization Cooperation Development Conference; 8

9 (3) Main Achievements of the Forum 12. October 2015: the Forum established strategic cooperation partnerships and signed Memorandums of strategic cooperation with Association for Financial Markets in Europe ( AFME )and Asia Securities Industry & Financial Markets Association ( ASIFMA ). 13. December 2015: the Forum established strategic cooperation partnerships and signed Memorandums of strategic cooperation with The Australian Securitisation Forum, Inc. ( ASF ) 14. December 2015: the Forum opened the online personal membership accounts for CSF individual members which were available for use. Online personal membership accounts provide an advanced and practical online networking environment by integrating CSF's organization platform, working platform, conference platform, training platform, communication platform, personal profile platform and advertising platform into a single unified application. CSF individual members may use their accounts to manage their personal information, send/receive messages, participate in various activities, etc. 9

10 (4) Restructuring of the Forum Purposes of the Restructuring Enable both Chinese and overseas members to work democratically and efficiently on the same platform. Serve as the catalyst for integrating certain neutral technical practices developed by overseas securitization markets into securitization practice in China, with the ultimate goal of safely and soundly developing a new source of value-added core funding for China s real economy. Time: September of 2014 Background: in response to the rapid development of China s asset securitization market Position: Benefit and serve both Chinese and overseas members alike over the long term by creating an efficient working platform infused with the spirit of democracy. Form: a non-governmental, non-profit permanent project. 10

11 (5) Core Purposes of the Forum Core Purposes Advocacy Education Consensus Building 11

12 (6) Duties of the Forum 1 Convene annual conferences and other seminars, and provide a networking platform for the asset securitization industry. 2 Communicate with lawmakers and regulators and other policy-making authorities on behalf of the asset securitization industry and reflect membership s consensus with regard to legal, regulatory, policy, and other matters affecting or potentially affecting the securitization market. 3 Educate the public about securitization finance. 4 Promote international communication and cooperation with other securitization markets and springboard off the experience and expertise of market participants from other countries. 5 Establish a working and social network to facilitate member and investor relationships and build consensus across the securitization industry. 6 Host project-oriented annual conferences. 7 Draft self-disciplinary rules and standard documents for the securitization industry. 12

13 (7) Development Model of the Forum Membership driven With the coordination and support of the Forum, each Committee will have considerable discretion to organize its own agenda and activities for the purposes of the Forum. Regulatory driven The Forum s activities will also be guided by suggestions from relevant regulatory agencies of the government. 13

14 (8) Organization Chart of the Forum Meeting of Members The Board Executive Committee Secretariat Standing Committees Nominating Committee Membership Committee Expert Advisor Committee Annual Conference Committee Conflict Resolution Committee Advocacy Committee Editorial Review Committee Education Committee Member Committees Asset Class Committees Subject Matter Committees Other Member Committees and Working Groups 14

15 (9) The Three-Tier Hierarchy of the Executive Bodies under the Meeting of Members Represents the interests of members with the objective of encouraging members to participate in the activities of the Forum. Elected by the Board, and reporting to the Board. As the standing executive body of the Forum, the Executive Committee plays a key role in managing the affairs of the Forum and solving the problems of the Forum in a timely manner when the Board is not in session. The Secretariat provides support for day-to-day operations and management of the Forum's affairs. Report to the Board, subject to the supervision and direction of the Executive Committee when the Board is not in session. The Board will be responsible for deliberating and deciding who will be the secretary-general and the secretary-general is entitled to decide other members of the Secretariat. Each Committee is operated as a sub-project of the Forum, and reports its activities to the Secretariat. Standing Committees handle the operational affairs of the Forum. Member Committees carry out professional activities of the Forum. 15

16 (10) Types of Membership in the Forum Members Institutional members open to domestic and overseas institutions, organizations and entities participating in the securitization industry, structured finance industry and related capital markets, including but not limited to issuers, investors, dealers, underwriting institutions, rating agencies, law firms, accounting firms and analytics providers. Individuals from Institutional Members Individual members open to domestic and overseas individuals who are active in the securitization or structured finance industry or related capital markets and who are interested in furthering the purposes of the Forum. individuals affiliated with institutional members may submit membership applications in their individual capacities and participate in the activities of the Forum as individual members. 16

17 (11) Rights and Obligations of Members Rights of Members * All members have the privilege to: apply to join the Member Committees of the Forum, apply to attend conferences, meetings and other activities organized by the Forum, have access to market information and communication achievements provided by the Forum, etc. * Institutional members have voting rights and the right to be elected, while individual members do not have these rights. Obligations of Members * All members have the duty to: abide by the Articles of Association and other by-laws of the Forum, protect the legal interests and professional prestige of the Forum, etc. * The Forum currently does not charge any membership fees. 17

18 2. The Forum s Guiding Principles (1) (2) (3) (4) (5) International Outlook Democratic Governance Project-Based Participation Convenient for Members to Participate Accommodative to Members' Needs and Priorities 18

19 (1) International Outlook The Internationalization Concept: The Forum is designed to be a venue for discussing issues relating to asset securitization finance with a global vision. The Forum will be open to both domestic and overseas professional institutions and individuals, and by building cooperative partnership relations with other asset securitization industry organizations, the Forum will leverage the participation of overseas experts to introduce cutting-edge overseas experience and innovative ideas in the field of asset securitization. 19

20 (1) International Outlook The Internationalized Development of the Forum: Strategic Cooperative Partnership with SFIG: In conjunction with its reorganization, the Forum has also established a long-term collaborative and strategic cooperative partnership with the Structured Finance Industry Group, Inc. ("SFIG"; website: in the United States. Prior to its reorganization, CSF consulted SFIG about the basic principles and objectives which are memorialized in SFIG's and CSF s organizational documents. SFIG, headquartered in Washington D.C. with a strong presence in New York, is a trade industry advocacy group focused on improving and strengthening the broader structured finance and securitization market. Up to November 17th, 2014, SFIG s founding members comprise 121 leading institutions from the U.S. asset securitization industry. 20

21 (1) International Outlook The Internationalized Development of the Forum: Strategic Cooperative Partnership with AFME: The Forum has established a long-term collaborative and strategic cooperative partnership with the Association for Financial Markets in Europe.( AFME ; website: AFME is the voice of Europe s wholesale financial markets which organises Europe s leading conference on securitisation, Global ABS. Strategic Cooperative Partnership with ASIFMA: The Forum has established a long-term collaborative and strategic cooperative partnership with the Asia Securities Industry& Financial Markets Association.( ASIFMA ; website: ASIFMA has over 90 member firms comprising a diverse range of leading financial institutions from both the buy and sell side. It harnesses the shared interests of the financial industry to promote the development of liquid, deep and broad capital markets in Asia. 21

22 (1) International Outlook The Internationalized Development of the Forum: Strategic Cooperative Partnership with ASF:The Forum has established a long-term collaborative and strategic cooperative partnership with the The Australian Securitisation Forum, Inc. ( ASF ; website: ASF is the industry body representing participants in Australia and New Zealand s securitisation and covered bond markets. Each year, it organises Australia s leading conference on securitisation. 22

23 (2) Democratic Governance Democratic Governance Principles: The Forum deeply respects the will of its Members with regard to Forum governance. Management of the Forum will focus on Members initiatives. Members' rights to join in Forum committees and participate in Forum activities are paramount. Institutional members may vote in elections for officers of the executive bodies and those executive bodies will also make resolutions democratically. Democratic governance reflects the Forum's membership-driven development model. 23

24 (2) Democratic Governance Democratic features of the Forum 1. Selection of Officers 4. Committee Activities 2. The Nominating Committee 3. Voting by Executive Bodies 24

25 (2) Democratic Governance 1 Selection of Officers (1) Intentions of Members When an institutional member submits its membership application, it will: Indicate its recommended director candidate. (if it decides to recommend) Indicate its recommended candidate for the chairmen/co-chairmen of the member committees. (if it decides to recommend) (2) Nominating & Screening in the Nominating Committee Nominating: Candidates for the chairman/co-chairmen of the Board (3) Democratic Election Nominating : Candidates for the rotational directors for each election panel (according to institutional members first-choice member committee) Nominating : candidates for the chairmen/co-chairmen of the member committees Elected by the Board Elected at each election panel Elected at each election meeting panel meeting 25

26 (2) Democratic Governance 2 The Nominating Committee 2. Formation of the Nominating Committee The Chairman of the Nominating Committee (concurrently chaired by the Chairman of the Executive Committee), and the vice chairman of the Nominating Committee (concurrently chaired by one Vice-Chairman of the Executive Committee) will be elected at a Board meeting. Three other members of the Nominating Committee will be three representatives of institutional members that are not represented on the Board. Such representatives will be appointed by the Board, which is authorized by the Meeting of Members. The Board will appoint representatives of institutional members not represented on the Board as members of the Nominating Committee, as proposed by the Executive Committee, in order to replace representatives who have been removed, resigned or whose terms have expired. As long as such representatives are members of the Nominating Committee, no representative of the institutional member that such member of the Nominating Committee represents will be nominated as a candidate for directorship on the Board. 26

27 (2) Democratic Governance 3 Voting by Executive Bodies 3. Decisionmaking by the Executive Bodies A resolution of any executive body will become effective only upon adoption by a simple majority vote or more than two thirds vote as applicable of the institutional members represented at a meeting and constituting a valid quorum. 27

28 (2) Democratic Governance 4 Committee Activities 1. Composition of Committees 2. Decision-Making Mechanism of each Committee Institutional Members are entitled to choose the standing committees and member committees which they wish to join or to participate in the activities of; The Forum will honor such intentions. Subject to the Articles of Association, each Committee will have considerable discretion to organize its own agenda and activities; One half or more of the members of any Committee will constitute a quorum. A simple majority of such quorum present may pass resolutions on matters submitted to the Committee for deliberation. Each Committee is entitled to pass resolutions proposed to such Committee and carry out activities which do not violate the principles of the Forum. 28

29 (3) Project-Based Participation 1Regular Training Activities The Forum has established a long-term cooperative partnership with the China Capital Market Institute ( CCMI ; website: Cooperative training and education model: CCMI organizes and arranges a rolling program of training activities for domestic and overseas individuals, and the Forum, through its committees, prepares the curriculum and course materials and provides the lecturers for the program. * Introduction to CCMI:China Capital Market Institute or CCMI (website: is a non-profit public institution under the direct supervision of the China Securities Regulatory Commission ( CSRC ). CCMI is committed to providing intellectual support and cultivating top-notch talent in order to promote the innovative development of China s capital markets. CCMI was capitalized at founding with contributions from seven sponsors, including the Shenzhen Stock Exchange, Shanghai Stock Exchange, Shanghai Futures Exchange, China Financial Futures Exchange, Dalian Commodity Exchange, Zhengzhou Commodity Exchange and China Securities Depository and Clearing Company Limited. 29

30 (3) Project-Based Participation 2Project-Oriented Annual Conferences The Forum will organize a project-oriented service platform for members at annual conferences, modelled after similar platforms provided by overseas asset securitization industry organizations. Specific Implementation:the Forum encourages members to take the opportunity at annual conferences to discuss with other members the implementation of specific projects (in addition to attending regular conference agenda items). 30

31 (4) Convenient for Members to Participate The Forum is committed to making participation in Forum activities as convenient as possible for members. Careful consideration is made to avoid adding extra burden on members. Except for the Forum s training activities and annual conferences, most Forum activities do not require members to attend face-to-face meetings. Forum events, discussions, voting, governance and other activities will be conducted in an -based remote manner. 31

32 (5) Accommodative to Members' Needs and Priorities 7. Suggest the Forum to recommend talents or provide trainings. 1. Join member committees of the Forum according to their interests; 2. Attend conferences, meetings and other activities organized by the Forum; 6. Propose to carry out market analysis and provide consulting service for its business development plans; Members 3. Gain access to market information and communication achievements provided by the Forum; 5. Propose seminars on topics of its interest in the field of securitization and structured finance; 4. Suggest topics for the annual conferences and other activities of the Forum; 32

33 3. Main Systems of the Forum (1). (2). (3). (4). (5). International Co-Chairmanship System Rotational Director System Nominating Committee Operations Electronic Voting System Expert Advisor System 33

34 (1) International Co-Chairmanship System Overview of the International Co-Chairmanship System: Except as otherwise provided in the Articles of Association, the Board and each committee or working group will operate under the leadership of its chairman and co-chairmen. The co-chairman can be a representative from overseas institutional members. The participation of foreign co-chairmen will be conducive to channeling advanced experience and innovative concepts in other asset securitization and structured finance markets through the Forum. 34

35 (2). Rotational Director System Seating of Rotational Directors: There will be no more than 100 rotational directors serving in staggered rotations on the Board. During early stages of the Forum s development, there may be fewer than 80 rotational directors seated. The number of rotational directors is expected to increase as the Forum grows. The rotational directors will be divided into two classes, with half of them in each class. Implementation: Rotational directors will serve in staggered rotation so that the term of approximately one half of the rotational directors will expire each year. At the annual meetings to elect rotational directors, a sufficient number of rotational directors will be elected to a term of two years to fill in vacancies on the Board caused by the expiration of the terms of previously-elected rotational directors, or for such lesser terms as may be required to fill vacancies caused by the resignation, removal, death or loss of capacity of any rotational directors. Any newly-created directorships or any decrease in the number of directorships will be apportioned between the two classes so as to make both classes as nearly equal in number as possible. Election System of Rotational Directors: The Election Panel will vote for the election of rotational directors via . 35

36 (2) Rotational Director System Reasons for seating directors on a rotating basis: Staggering the board provides a means to increase the frequency of replacement of rotational directors without decreasing the term of service of the directors, and also allows for new directors and experienced directors to serve on the board at the same time. This continuous overlap between new directors and old directors, as well as the increased frequency of replacement, is conducive to keeping the Forum vitalized and energetic while maintaining the stability of the Board. 36

37 (3) Nominating Committee Operations 1 Principles for Nominating Candidates 1 Respect the intentions of institutional members; 2 The recommendations and choices made by the institutional members are the first factors to be considered. 3 Other factors such as professional qualifications and prior contributions to the Forum s work are also taken into consideration. 37

38 (3) Nominating Committee Operations 2 Source of Nominating Candidates Generally, candidates for the offices of the executive bodies will be nominated from among the representatives appointed by institutional members and recommended director candidates, subject to the Articles of Association. Candidates 1. Candidates for Chairman/Cochairman of the Board and Candidates for Rotational Director 2. Candidates for Chairman/Cochairmen of certain Standing Committees 3. Candidates for Chairman/Cochairmen of the Member Committees and Working Groups 4. Candidates for Honorary Director 5. Other Candidates Nominee Pool Candidates for directorships recommended by institutional members Candidates recommended by institutional members Candidates recommended by institutional members Individuals or representatives of institutions, who have significant influence and good reputations in the securitization field Other candidates will be nominated in the function of the position, their professional reputation, prior participation in the Forum and other relevant considerations. 38

39 (3) Nominating Committee Operations 3 Overseas Advisor System Overseas Advisor System: The Nominating Committee has the discretion to engage chairmen, vicechairmen, executive directors, CEOs and other officers of overseas asset securitization industry businesses and organizations as Overseas Advisors of the Nominating Committee. Role of Overseas Advisors: Overseas Advisors are entitled to provide consultations in individual capacities in respect of nomination matters. They may recommend representatives of the members of asset securitization industry organizations or other individuals with relevant qualifications and experience as candidates. The Nominating Committee may take the initiative to consult with its overseas advisors in respect of Nominating Committee matters. 39

40 (4) Electronic Voting System Background and Purpose: To reduce the burden on members and establish an efficient working platform for both Chinese and overseas members. Scope: Voting at Board meetings (unless the Chairman of the Executive Committee decides otherwise) ; Election of rotational directors ; Election of the chairmen and co-chairmen of Member Committees. Monitoring System: To ensure the fairness of the results, the voting processes are under scrutiny of the Executive Committee and certain designated observers (please refer to slide 57 for more information). 40

41 (5) Expert Advisor System Purpose The Forum will set up an expert consultant committee for the professional advice and consultation from officials, experts, scholars and other professionals attending the Forum. Expert advisors provide professional advice to the Forum solely in their individual capacities, and not as representatives of any other organizations with which they may be affiliated. Composition The Expert Consultant Committee will consist of the chairman, the co-chairman of the Expert Consultant Committee and senior expert consultants decided upon and appointed by the Executive Committee.. Members As expert advisors to the Forum, they may provide their personal advice to facilitate the Forum in achieving its purposes and performing its duties. 41

42 4. The Meeting of Members: Overview (1) Composition, Role and Duties of the Meeting of Members (2) Conferences of the Meeting of Members 42

43 (1) Composition, Role and Duties of the Meeting of Members Composition All members Role The highest authority of the Forum Duties To deliberate and vote on proposed amendments to the Articles of Association of the Forum; To deliberate and vote on motions to dissolve the Forum; To deliberate and vote on proposals submitted by the Board; and To deliberate and vote on written proposals jointly submitted to the Board by no less than one third of all institutional members. 43

44 (2) Conferences of the Meeting of Members Convening Conferences The Meeting of Members will convene irregularly at the direction of the Board or upon written petition to the Board by no less than one third of all institutional members. Notice of the Conferences The Secretariat will organize each conference of the Meeting of Members. The Secretariat will notify all members the time, venue and manner of convening each conference no later than 10 days prior to the conference. Quorum At least half of the institutional members must be present at a conference of the Meeting of Members by their appointed representatives in order to constitute a quorum. Voting Each institutional member in compliance with the Articles of Association is entitled to one vote. Individual members may participate in any conference of the Meeting of Members but has no right to vote. Resolution Adoption of a Board or member proposal will be by vote of a simple majority of the institutional members present at the conference. Adoption of amendments of the Articles of Association or dissolving of the Forum will be by no less than two-thirds votes of the members present. 44

45 5. Board of Directors: Overview (1) (2) (3) (4) (5) (6) (7) Role and Main Responsibilities of the Board Composition of the Board and Term of Office of Directors Election of Non-Rotational Directors Election of Rotational Directors Board Meetings and Notices Voting at Board Meetings Special Provisions on Voting by at Board Meetings 45

46 (1) Role and Duties of the Board Role The Board is the executive body of the Meeting of Members, responsible for the overall supervision and guidance of the Forum, and will be accountable directly to the Meeting of Members. 1. To elect the chairman, the co-chairmen, the vice-chairman and the honorary directors of the Board, and all members of the Executive Committee, and to elect one vice-chairman of the Executive Committee as the vice-chairman of the Nominating Committee. 2. To supervise the work of the Nominating Committee under the authorization of the Meeting of Members. Duties 3. To appoint all the members (excluding the chairman) of the Membership Committee. 4. To appoint the secretary-general and decide whether to employ the secretary-general on a fulltime basis, pursuant to appropriate review and deliberation; 5. To convene conferences of the Meeting of Members and set the agendas thereof. 6. To deliberate on and decide whether to approve the annual reports of the Forum submitted by the secretary-general. 7. To deliberate on and decide whether to approve other major rules of the Forum except for the Articles of Association. 8.To perform other duties as provided in the Articles. 46

47 (2) Composition of the Board and Term of Office of Directors Chairman of the Board (one) Co-Chairmen of the Board (multiple) Vice-Chairman of the Board (one, concurrently the Chairman of the Executive Committee) Honorary Directors (unspecified number) Rotational Directors (no more than 100) Composition of the Board Term of Office 1. approximately two years 2. serve consecutive terms on the Board if re-elected 1. approximately two years 2. not to serve more than two full terms consecutively. 3. After two consecutive full terms, a one-year period must elapse prior to renominating. 47

48 (3) Election of Non-Rotational Directors A simple majority vote of the directors Chairman of the Board Co-Chairmen of the Board Board Meetings Present via s Vice-Chairman of the Board (concurrently chaired by the Chairman of the Executive Committee) At least two thirds of voting directors Honorary Directors 48

49 (4) Election of Rotational Directors 1 Election Meetings for Rotational Directors Election Meetings for Rotational Directors: Candidates for directorships recommended by institutional members will be candidates for rotational directors for the election after nominated by the Nominating Committee. A meeting for staggered election of rotational directors will be held each year. The meeting will be subdivided into election panels comprised of institutional members of the Forum, with each election panel electing a designated number of rotational directors. To improve the efficiency of the election process, all meetings for the election of rotational directors will adopt electronic voting by s. 49

50 (4) Election of Rotational Directors 1 Election Meetings for Rotational Directors Advantages of adopting election panels (rather than convening conferences of the Meeting of Members): 1. Increases members' level of involvement. As each election panel is comprised of members from corresponding member committee(s), and members are more directly interested in the future development of their member committees which they belong to, they naturally attach greater importance to the election of directors who will represent and look out for the interests of their committees. On the other hand, if rotational directors are elected directly by the meeting of members, the members and the candidates for the rotational directorships may not know each other well. As a result, the members may be less focused and involved in the election, and the election would become formalistic and less active, which may not be as conducive to the vitality of the Forum. 50

51 (4) Election of Rotational Directors 1 Election Meetings for Rotational Directors Advantages of adopting election panels (rather than convening conferences of the Meeting of Members): 2. Rotational directors may better represent the corresponding member committees that elected them. Candidates for rotational directorships for each election panel will be nominated in accordance with the recommendations submitted by the institutional members of such panel. Therefore, each elected rotational director will provide support in Board meetings for the work of the corresponding member committees constituting the election panel out of which he/she is elected. This structure is similar to the election of senators and congressional representatives for each state in the USA, each of who will focus on energetically representing interests of their own state constituencies. In conclusion, the adoption of election panels is an important means to achieve democratic governance of the Forum. The panel election process helps motivate all institutional members to participate in elections, and furthermore, the elected rotational directors will have incentive to energetically represent the corresponding member committees and promote the development of the Forum by organizing committee activities in accordance with the Forum s overall purposes. 51

52 (4) Election of Rotational Directors 2 Procedures for the Election of Rotational Directors (1) Composition of the election panels for rotational directors: the institutional members from the corresponding member committees (2) Designation of Candidates for rotational directorships (3) Election process: voting via , and monitored by observers. 52

53 2 Procedures for the Election of Rotational Directors 1) Composition of the election panels for rotational directors Election Panels for rotational directors will be formed in accordance with the different specific member committees chosen by institutional members. Each institutional member will be assigned to a particular Election Panel representing a particular member committee that such member indicated in its membership application as one of the committees that it is the first-choice one. The Executive Committee will appoint the members of each Election Panel. After consultation with the Secretariat, the Executive Committee will appoint members of each Election Panel according to the number(s) of members of each relevant member committee. In principle, each Election Panel will be composed of the members of one or more member committees. A Member Committee X Election Panel B Member Committee C Member Committee Y Election Panel 53

54 2 Procedures for the Election of Rotational Directors 2) Candidates for rotational directorships The Nominating Committee will nominate candidates for rotational directorships. The overall number of rotational directors to be elected and the number of rotational directors to be elected by each Election Panel will be determined by the Executive Committee. The Nominating Committee will nominate the candidates for directorships from the candidates recommended by the institutional members in their online membership applications. Substitution of recommended candidates If any institutional member decides to change the candidate that it wishes to recommend for a directorship, it should inform the Forum without any delay, including relevant information about the recommended candidate, by to the Forum s address (secretariat@chinasecuritization.org), and update relevant information in My Account in institutional membership online management system. The Nominating Committee will nominate candidates in accordance with any updated recommendations submitted by institutional members. Unless the Forum has received such notice concerning the recommendation of a new candidate, it will deem that there is no change to the candidate indicated in such member's online membership application (or most recent previous notice), and the Forum will not be burdened with any duty to inquire. 54

55 2 Procedures for the Election of Rotational Directors 3) Election process Quorum At least half of the institutional members of an Election Panel must participate by in order to constitute a quorum for the election of rotational directors. Voting rights Each institutional member complying with the Articles of Association will be entitled to one vote. 55

56 2 Procedures for the Election of Rotational Directors: 3) Election process 1. Voting notice The Executive Committee will decide the time when each Election Panel will hold its election meeting. The Secretariat will organize the meeting and send a list of rotational director candidates for each Election Panel to the addresses of the representatives of the institutional members prior to election. 2. Voting The representative of each institutional member shall send the voting ballot to the Forum at CSF@chinasecuritization.org within three working days from the date the Secretariat sent a voting notice (such three working days to include the day on which such voting notice was sent). Any institutional member failing to send its ballot within such three days will be deemed to have waived its voting rights. 56

57 2 Procedures for the election of rotational director: 3) Election process 3. Monitoring of voting 4. Announcement of voting results Members of the Executive Committee and three observers who are the representatives of three institutional members that are not represented by directors on the Board will oversee the election process and ensure the fairness of voting results. To ensure the transparency of the entire voting process, all ballot s sent to the aforesaid address of the Forum will be immediately and automatically forwarded to the addresses of all members of the Executive Committee and the designated observers. One observer designated as the chief observer will, after verifying and confirming the voting results with all members of the Executive Committee and the two other observers, notify the chairman of the Executive Committee of the voting results. In accordance with the number of rotational directors for each Election Panel assigned by the Executive Committee, the elected rotational directors will be determined by ranking the candidates in descending order of votes received. In case of equal votes among candidates, and if such candidates outnumber the number of rotational directors yet to be elected, the chairman of the Executive Committee has the discretion to decide which candidate will be elected. After determining the voting results, the chairman of the Executive Committee and the chief observer will announce the voting 57 results together.

58 (5) Board Meetings and Notice Holding of Board Meetings A regular meeting of the Board will be held after each annual election of rotational directors is closed. In addition, interim meetings of the Board will be held as decided by the Executive Committee or as requested by no less than one third of the directors. Notice of Board Meetings The Secretariat will organize each meeting of the Board and deliver the notice, including the time, venue and manner of convening the meeting, to all directors no later than five days prior to the meeting. 58

59 (6) Voting at Board Meetings Quorum At least half of the directors must be present at a Board meeting or participate in the meeting by in order to constitute a quorum. Voting rights Each director, other than an honorary director, will be entitled to one vote. No director is permitted to vote on behalf of any other director at the Board meetings. Board resolution A resolution for election of an honorary director will be adopted by over two thirds vote of the directors present at a Board meeting or participating in the meeting by s. Other than point one, a Board resolution will be adopted by a simple majority of the directors present at a Board meeting or participating in the meeting by . 59

60 (7) Special Provisions on Voting by at Board Meetings Unless the chairman of the Executive Committee decides otherwise, all votes to be cast in connection with meetings of the Board will be submitted via . 1 Voting notice When matters are put to vote after the Board completes pre-meeting procedures, the Secretariat will send notice of such matters and related voting procedures to the addresses of the directors. 2 Voting Each director other than an honorary director will send his ballot to the Forum at CSF@chinasecuritization.org within three working days from the date of a voting notice from the Secretariat (such three working days to include the day on which the notice was sent). Directors who fail to send their ballots within such three working days will be deemed to have waived their voting rights. 60

61 (7) Special Provisions on Voting by at Board Meetings 3 Monitoring of voting and announcement of voting results Members of the Executive Committee and three observers who are the representatives of three institutional members that are not represented by directors on the Board will oversee the election process and ensure the fairness of voting results. The three observers, including one designated to be the chief observer, will be nominated by the Nominating Committee and appointed by the chairman of the Executive Committee and the chairman or co-chairman of the Board who is presiding over that meeting. To ensure the transparency of the entire voting process of each meeting, all ballot s sent to the aforesaid address will be immediately and automatically forwarded to the addresses of all members of the Executive Committee and the three observers. The chief observer will count the votes cast by , verify and confirm the counted results with all members of the Executive Committee and the two other observers to assure their correctness, and send the counted results to the chairman or co-chairman of the Board who is presiding over that meeting, who will announce the voting results. 61

62 6. The Executive Committee (1) Role and Duties of the Executive Committee (2) Composition of the Executive Committee, Term of Office and Election of Members (3) Meetings of the Executive Committee 62

63 (1) Role and Duties of the Executive Committee Role The Executive Committee will be responsible for the management of the Forum s affairs when the Board is not in session and may exercise all the powers of the Board in all matters which in the judgment of the Executive Committee cannot or should not be delayed until the next meeting of the Board. Duties to decide the number of rotational directors to be elected each year, the composition of each Election Panel, and the number of rotational directors assigned to each Election Panel; to carry out all resolutions passed by the Meetings of Members and the Board; to decide all material matters regarding the management of the Forum when the Board is not in session; to direct the work of the Secretariat; 63

64 (2) Composition of the Executive Committee, Term of Office and Election of Members Executive Committee One chairman (who will concurrently be the vice-chairman of the Board) An unspecified number of vice-chairmen An unspecified number of members Term of Office and Election of Members Members will be elected by a simple majority vote of the directors present at a Board meeting or participating in the meeting by . A full term will be two years in duration. Members may serve consecutive terms if re-elected. 64

65 (3) Meetings of the Executive Committee Convening Form To improve its efficiency, the Executive Committee may hold its meetings with the participants being present at the meetings, or attending the meetings by telephone, or voting at the meetings by . Quorum At least half of the members of the Executive Committee must be present at a meeting of the committee or participate in the meeting by in order to constitute a quorum. Voting Rights Each member of the committee will have one vote. A resolution of the committee will be adopted by a simple majority vote of the members present at a meeting of the committee or participating in the meeting by . 65

66 7. The Secretariat (1) Role, Duties and Composition of the Secretariat (2) The Secretary-General (3) Other Personnel of the Secretariat 66

67 (1) Role, Duties and Composition of the Secretariat Role The Secretariat will provide support for day-to-day operations and management of the Forum's affairs and report to the Board, subject to the supervision and direction of the Executive Committee when the Board is not in session. Duties implement resolutions passed by the Meetings of Members, the Board and the Executive Committee; draft an annual report; provide services in respect of membership admission, membership withdrawal and daily liaison; assist in organizing and preparing for seminars, annual meetings and other themespecific symposia of the Forum; build and manage the website and the system of the Forum. Composition The Secretariat will consist of the secretary-general and other personnel. 67

68 (2) The Secretary-General Role The secretary-general is the chief executive manager of the Forum and will be responsible for the administrative affairs of the Forum. Duties supervise and manage the general affairs of the Forum; attend all meetings of the Board and the Executive Committee and report formally or informally on all matters concerning the administrative affairs of the Forum; send notices of the convening of the Meeting of Members, Board meetings and meetings of the Executive Committee; keep all the official correspondence of the Forum, and take minutes of the conferences of the Meeting of Members, Board meetings and meetings of the Executive Committee; submit to the Board annual work reports of the Forum drafted by the Secretariat; submit significant motions to the Board and the Executive Committee for deliberation; implement the rules and regulations approved by the Board; decide the appointment of other personnel of the Secretariat; perform other duties as regulated by the Articles of Association. Appointment and Term of Office The appointment of the secretary-general will be decided by the Board. The Board has the power to decide whether a full-time secretary-general will be appointed, based on prevailing circumstances in respect of the Forum. The secretary-general will have a two-year term of office and may serve consecutive terms if reappointed upon expiration of a term of office. 68

69 1. Purpose To ensure the efficiency of the Secretariat, the secretary-general is authorized to appoint other personnel to the Secretariat at any time in response to the needs of the Forum. 2. Qualification Other personnel of the Secretariat may be the representatives of the members of the Forum or any other competent individuals who satisfy the secretary-general s requirements. 3. Positions (3) Other Personnel of the Secretariat Other personnel of the Secretariat may include a deputy secretary-general, assistants to the secretary-general, secretarial staff, financial staff, a business manager, policy analysts, clerks and advisors, among others. 69

70 (3) Other Personnel of the Secretariat 4. Duties The secretary-general is empowered to decide the duties of the foregoing personnel and set forth their job requirements and tasks in accordance with the objectives of the Forum. All other personnel of the Secretariat will directly report to the secretarygeneral. 5. Appointment and Term of Service The secretary-general will be authorized to decide the appointment of other personnel of the Secretariat, including whether such personnel will be full-time or part-time employees. Their terms of service will be two years and they may serve consecutive terms if re-appointed. 70

71 8. Committees (1) (2) (3) (4) (5) (6) The Forum s Committee Framework Standing Committees Nominating Committee List of Member Committees Establishment and Adjustment of Member Committees; Special Duties of Member Committees Appoint or Election of Chairmen/Co-Chairmen of the Committees 71

72 (1) The Forum s Committee Framework Executive Committee Secretariat Standing Committees Nominating Committee Membership Committee Expert advisor Committee Annual Conference Committee Conflict Resolution Committee Advocacy Committee Editorial Review Committee Education Committee Member Committees Asset Class Committees Subject Matter Committees Other Member Committees and Working Groups 72

73 (2) Standing Committees (1) Standing Committees Nominating Committee Membership Committee Role: to nominate candidates for appointment or election to the Forum s various bodies. Composition: one chairman of the Executive Committee (serving concurrently as the chairman of the Nominating Committee), one vice chairman of the Executive Committee (serving concurrently as the vice chairman of the Nominating Committee) and representatives of three institutional members that are not represented on the Board. No co-chairmanship is set up in the Nominating Committee. Role: to address matters concerning administration of membership and to address other matters at the request of the Board and make recommendations to the Board with respect thereto. Composition:the chairman of the Executive Committee, (serving concurrently as a chairman of the Membership Committee), a co-chairman and various institutional members of the Forum. The co-chairman and other members of the Membership Committee will be appointed by the Board. Role: to organize the annual conferences of the Forum Annual Conference Committee Composition: the chairman of the Executive Committee (serving concurrently as the chair man of the Annual Conference Committee), the secretary-general, and various institutional members of the Forum appointed by the Executive Committee. The Annual Conference Committee will have a co-chairman, who will be appointed by the Executive Committee. 73

74 (2) Standing Committees (2) Education Committee Role:to organize and arrange for all educational and training activities sponsored or co-organized by the Forum. Composition:the secretary-general and institutional members appointed by the Executive Committee. Standing Committees Editorial Review Committee Role:to review, edit and approve all comment letters and public statements to be released by the Forum or by one or more of the Committees. Composition:institutional members appointed by the Executive Committee. Conflict Resolution Committee Role: to resolve material conflicts on issues that are referred to the committee, in accordance with the Conflict Resolution Policy (attached to the Articles of Association) Composition:all members of the Executive Committee and other members appointed by the Executive Committee. There will be a chairman and a co-chairman. Refer to the Conflict Resolution Policy for more details. 74

75 (2) Overview of each Standing Committee (3) Advocacy Committee Role: to determine the advocacy priorities of the Forum and recommend to the Executive Committee the establishment of additional member committees, or the establishment of Working Groups. Composition: institutional members appointed by the Executive Committee. It will have a chairman and a co-chairman, both of whom will be appointed by the Executive Committee. Standing Committees Role: The Forum will set up an expert consultant committee for the professional advice and consultation from officials, experts, scholars and other professionals attending the Forum. The advice given by the invited members of the Expert advisor Committee will only be reported within the management level of the Forum by informal and non-written means, and no such advice will be announced publicly under any circumstances. Expert advisor Committee Composition: the chairman, the co-chairman of the Expert Consultant Committee and senior expert consultants decided upon and appointed by the Executive Committee. Members of the Expert Advisor Committee will be individuals from domestic and overseas regulatory, legislative or other policy-making bodies or industry associations or organizations relating to asset securitization and structured finance, or experts or scholars who specialize in securitization and structured finance, or reputable individuals who have great influence on the securitization and structured finance market. 75

76 Nominating Committee (3) Nominating Committee 1 Composition, Election and Term of Office Chairman of the Executive Committee ( also serving as chairman of the Nominating Committee) (two-year term of office, consecutive if applicable) One Vice-Chairman of the Executive Committee ( also serving as vice-chairman of the Nominating Committee) (two-year term of office, consecutive if applicable) Representatives of three institutional members that are not represented on the Board (four-year term of office, consecutive if applicable) supervise appoint replacement * Board meetings Board authorize Executive Committee * Conditions for replacement: to replace representatives who have been removed, have resigned or whose terms have expired. Removal from the Nominating Committee:If proposed by the Executive Committee, the Board may remove representatives in the following circumstances: two consecutive and unexcused absences from the meetings of the Nominating Committee, non-performance of duties, or the representative is no longer employed by the original institution (unless the new employer of such representative is also a 76 member of the Forum). elect elect authorize nominate Meeting of Members

77 (3) Nominating Committee 2 Independence of the Members Objective: To ensure the independence and authority of the members of the Nominating Committee. As long as representative is a member of the Nominating Committee: No representative of an institutional member that any member of the Nominating Committee represents will be nominated as a candidate for Director of the Board. Chairman of the Board Co-Chairman of the Board Rotational Director Honorary Director 77

78 (3) Nominating Committee 3 Duties Meeting of Members Nominating Committee Report to nominates Candidates for chairman, co-chairmen, the honorary directors and rotational directors of the Board. Candidates for members of the Executive Committee. Candidates for secretary-general. Candidates for chairman and cochairmen of each standing committee, member committee or working group. Candidates for election observers, including the chief observer. 78

79 (4) Member Committees 1. List of Asset Class Committees (1) Enterprise Loan Securitization Committee (2) Commercial Mortgage Backed Securitization Committee (3) Residential Mortgage Backed Securitization Committee (4) Auto Loan and Equipment Loan Securitization Committee (5) Leasing Asset Securitization Committee (6) Factoring Asset Securitization Committee (7) Insurance Asset Securitization Committee (8) Trust Asset Securitization Committee (9) Fund Asset Securitization Committee (10) Real Estate Asset Securitization Committee (11) Credit Card Receivables Securitization Committee (12) Future Receivables Securitization Committee (13) Infrastructure and Utility Securitization Committee (14) Non-Performing Asset Securitization Committee (15) Esoteric Asset Securitization Committee 79

80 (4) List of all Member Committees 2. List of Subject Matter Committees (1) ABS Issuance and Underwriting Policy Committee (2) Securitization Legal Issue Research Committee (3) Accounting Policy Committee (4) Tax Policy Committee (5) Rating Methodology and Policy Committee (6) Regulatory Capital and Liquidity Committee (7) Asset-Backed Note Committee (8) Asset-Backed Special Program Committee (9) Project Asset-Backed Program Committee (10) Revolving Asset Purchasing and Structuring Committee (11) Risk Retention Committee (12) Shadow Banking Committee (13) Offshore Securitization Policy Committee (14) Derivative Instrument and Synthetic Structures Committee (15) Whole Business Securitization Committee (16) Liquidity Support Committee (17) Credit Enhancement Committee 3. Other Member Committees and Working Groups 80

81 (5) Establishment and Adjustment of Member Committees; Special Duties of Member Committees Establishment and Adjustment of Member Committees As the Board or the Executive Committee may deem necessary from time to time, member committees may be adjusted (including changing committee names and consolidating or winding up member committees) and other member committees and Working Groups pertaining to specific issues may be created. Special Duties of Member Committees In addition to performing the responsibilities in relation to their respective purposes of establishment, member committees are required to provide necessary support for the annual conferences and training activities hosted by the Annual Conference Committee and the Education Committee. Such support includes, but is not limited to, providing research proposals and content for the annual conferences and training activities and recruiting keynote speakers and moderators for such events. 81

82 (6) Appointment or Election of Chairmen/Co-Chairmen of the Committees 1 Standing Committees The chairman and co-chairmen of some Standing Committees will be elected or appointed in accordance with the Articles of Association. The chairman and co-chairmen of some Standing Committees will be candidates recommended by institutional members who are subsequently nominated by the Nominating Committee and appointed by the Board or the Executive Committee (as applicable in accordance with the Articles of Association). 82

83 (6) Appointment or Election of Chairmen/Co-Chairmen of the Committees 2 Member Committees 1) Nomination of candidates The Nominating Committee will respect the intentions of the institutional members. When more than one institutional member chooses the same member committee, the Nominating Committee will decide candidates for the chairman and the co-chairmen of such member committee based on the professional experience and market reputation in the related field, and the contributions to the Forum s work of those institutions and their representatives. 2) Election The Election Panel will elect the chairman and the co-chairmen of such member committee concurrent with electing rotational directors. 3) Chairmen and co-chairmen of newly-established committees or working groups The chairman and the co-chairmen of a newly-established committee or working group will be nominated by the Nominating Committee based on the intention of becoming such chairman or co-chairmen indicated by institutional members in accordance with the function of the position, their professional reputation and prior participation in the Forum when applying for membership on such committee. The chairman and the co-chairmen of a newly-established committee or working group will thereafter be appointed by the Executive Committee. 83

84 9. Membership (1) Eligibility, Approval and Membership Fees (2) (3) Membership Application Procedures Legal Opinion regarding the Legality of Members Joining the Forum 84

85 (1) Eligibility, Approval and Membership Fees Eligibility Membership is open to domestic and overseas institutions and individuals engaged in, or desiring to be engaged in or simply having interest in, the securitization and structured finance sectors. Approval Please apply for membership online in CSF membership online management system. Admission as a member is subject to the Forum s approval. Membership Fees The Forum currently does not charge dues from members. Application Application of Individual Membership: Application of Institutional Membership: 85

86 (2) Membership Application Procedures 1 Submit online application. Please apply for membership online in CSF membership online management system 2 Initial screening by the Secretariat. The Secretariat will be responsible for preliminary examination of applications, and the Executive Committee will examine valid applications submitted by the Secretariat. 3 Approval After approval by the Executive Committee, the Secretariat will send a written confirmation letter. 86

87 (3) Legal Opinion regarding the Legality of Members Joining the Forum Zhong Lun Law Firm has issued a Legal Opinion regarding the Legality and Validity of the Articles of Association of the China Securitization Forum, opining that: I. The Articles of Association ( AOA ) do not violate the currently effective mandatory laws and regulations of the PRC; II. The organization of activities and execution of documents by the Forum in its own name does not violate the currently effective mandatory laws and regulations of the PRC; and III. An applicant s submission of an online application for membership and the Forum s acceptance of such application are both valid and effective legal actions under the currently effective mandatory laws and regulations of the PRC. 87

88 10. The Elected Executive Committee, Nominating Committee and the Secretary-General (1) Members of the Executive Committee elected by the Meeting of Founding Members (2) Members of the Nominating Committee elected by the Meeting of Founding Members (3) The Secretary-General appointed by the Meeting of Founding Members 88

89 (1) Members of the Executive Committee Pursuant to the Articles of Association, the Meeting of Founding Members of the Forum unanimously elected the chairman, vicechairman and members of the first Executive Committee. Chairman of the first Executive Committee: Mr. Liu Borong(Partner of Zhong Lun Law Firm) Vice-Chairman of the first Executive Committee: Mr. Liu Fan, Managing Director at Department of Debt Capital Market of CITIC Securities 89

90 (1) Members of the Executive Committee Member of the first Executive Committee: Mr. Ma Li, Managing Director of Moody s Investors Service (Beijing) Co. Ltd. lima@ccxi.com.cn Member of the first Executive Committee: Mr. Jeff Tao, Global Financial Service Industry Partner of Deloitte Touche Tohmatsu CPA LLP jetao@deloitte.com.cn Member of the first Executive Committee: Mr. Chen Chunfeng, Director of Capital Market Solutions, Standard Chartered Bank, China Steven.CF.Chen@sc.com 90

91 (2) Members of the Nominating Committee Pursuant to the Articles of Association, the Meeting of Founding Members of the Forum unanimously elected the chairman and vice-chairman of the Nominating Committee, and appointed representatives of three institutional members (which institutional members will not be represented on the Board) to be the members of the first Nominating Committee. Chairman of the first Nominating Committee: Mr. Liu Borong(Partner of Zhong Lun Law Firm) Vice-Chairman of the first Nominating Committee: Mr. Liu Fan, Managing Director at Department of Debt Capital Market of CITIC Securities 91

92 (2) Members of the Nominating Committee Member of the first Nominating Committee: Mr. Ma Li, Managing Director of Moody s Investors Service (Beijing) Co. Ltd. lima@ccxi.com.cn Member of the first Nominating Committee: Mr. Jeff Tao, Global Financial Service Industry Partner of Deloitte Touche Tohmatsu CPA LLP jetao@deloitte.com.cn Member of the first Nominating Committee: Mr. Chen Chunfeng, Director of Capital Market Solutions, Standard Chartered Bank, China Steven.CF.Chen@sc.com 92

93 (2) Members of the Nominating Committee The Nominating Committee has discretion to engage chairmen, vice-chairmen, executive directors, chief executive officers and other officers of overseas asset securitization industry organizations as Overseas Consultants, in order to consult about the nomination of overseas experts. Overseas Consultants are entitled to provide consultation in their individual capacities in respect of the nomination matters. Overseas Consultant: Richard Johns(Executive Director & CEO of the Structured Finance Industry Group, SFIG ) richard.johns@sfindustry.org 93

94 (2) Members of the Nominating Committee Overseas Consultant: Patrick Pang (Managing Director-Head of Fixed Income and Compliance of the Asia Securities Industry& Financial Markets Association, ASIFMA ) PPang@asifma.org Overseas Consultant: Richard Hopkin (Head of Fixed Income of the Association for Financial Markets in Europe, AFME, Conference Chairman of Global ABS 2015) Richard.Hopkin@afme.eu 94

95 (2) Members of the Nominating Committee Overseas Consultant: Chris Dalton (Chief Executive of the Australian Securitisation Forum, ASF) Overseas Consultant: Susie Cheung (Co-Convenor of the Asia-Pacific Structured Finance Association (APSA)) 95