Editor's note

• Author: HU Tianlong
• Pages: 499-500

FRONTIERS OF LAW IN CHINA

VOL. 12 DECEMBER 2017 NO. 4

DOI 10.3868/s050-006-017-0027-8

FOCUS

NEW CHALLENGES AND UNDERTAKINGS FOR ADMINISTRATIVE AND

REGUL ATORY REFORM: A GLOBAL WATCH WITH CHINESE PERSPECTIVE

EDITOR’S NOTE

HU Tianlong*

This issue of Focus compiles articles that showcase challenges taken and dilemmas

endured by various Chinese administrative or regulatory bodies as well as international

communities. The article authored by Professor Bruno da Silva reviews the conception of

beneficial ownership and offers a very important piece interpreting the evolution

beneficial ownership, one of the key concepts contained mostly in Articles 10, 11 and 12

of major international tax treaties but surrounded by great uncertainty. The article in a

smart way demonstrates that, by reviewing the amendments to the OECD Commentary

and the reports released by the OECD, the conception of beneficial ownership has not

always been clear on the meaning, especially courts and authorities from various

jurisdictions have adjudicated divergent interpretations in this connection. The article

discusses that the inclusion of beneficial ownership in the Model arose in a moment when

it was no longer necessary considering the second sentence of Article 4.1. The article

further argues that the 2014 Commentary updated for the first time a definition of

beneficial ownership by outlining two elements of “beneficial owner” and clarifies that

the core feature therein is that the person who receives the payment (i.e., the dividend,

interest or royalty) and has the right to use and enjoy it, may not be obliged —

contractually or legally — to pass on the income item to another person.

The article on insider trading focuses on an in-depth examination and comparison on

the regulations of insider trading in the UK and China in order to figure out what has been

achieved in the UK could be studied by its Chinese counterpart. Mostly, this article argues

that the failure of some notable prosecutions, the enforcement of insider dealing rings,

and the need to implement a civil penalty system, are all pressures for change in the

existing regulations in the UK. For instance, the Financial Conduct Authority (FCA)

views the proportionate and effective use of its enforcement powers to meaningfully

* (胡天龙) S.J.D., University of Michigan Law School, Ann Arbor, Michigan, USA; Research Fellow,

International Monetary Institute, Renmin University of China, Beijing, China; Associate Professor, School of

Finance, Renmin University of China, Beijing 100872, China. Contact: tianlongchina@163.com 