What Is an Investment Trust Company?

A trust company in China refers to a financial institution established in accordance with the "Company Law of the People's Republic of China" and in accordance with the "Administrative Measures for Trust and Investment Companies" to conduct trust business. A trust company is a multilateral credit act combining financing and financing based on trust entrustment and in the form of monetary funds and physical property management.

Trust company

(1) The trust is based on trust, and the trustee should have a good reputation.

(2) The premise of the establishment of the trust is that the trustor shall entrust his own property to the trustee.

(3) The trust property is independent. After the trust is established in accordance with the law, the trust property is separated from the property owned by the trustor, the trustee and the beneficiary, and becomes an independently operated property.

(4) The trustee manages trust affairs in the best interests of the beneficiary.

The trust business scope includes commercial trusts, civil trusts, and public trusts. Financial trust and investment companies approved by the central bank can operate four types of trust businesses, including fund trusts, movable trusts, real estate trusts, and other property trusts.

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(2) The client has the right to know the management, use, disposition and income and expenditure of his trust property, and has the right to ask the trustee to make explanations. The client has the right to inspect, copy or copy the trust accounts related to its trust property and other documents dealing with trust affairs.

(2) The trustee has the right to require the trustee to adjust the management method of the trust property when the management method of the trust property is not conducive to the realization of the trust purpose or is not in line with the interests of the beneficiary due to special reasons unforeseen when the trust was established.

(3) If the trustee disposes of the trust property in violation of the purpose of the trust or loses the trust property due to violation of management duties or improper handling of trust affairs, the client has the right to apply to the people's court to revoke the punishment and has the right to require the trustee to restore the original state of the trust property Or compensation; if the transferee of the trust property knows that the property was violated for the purpose of the trust, it shall be returned or compensated.

(2) If the trustee disposes of the trust property in violation of the purpose of the trust or manages the use of the trust property or disposes of the trust property with serious fault, the client shall have the right to dismiss the trustee in accordance with the provisions of the trust document, or apply to the people's court to dismiss the trustee.

Trust business categories include:

If the trustee (trust and investment company) manages and uses the trust funds in accordance with the terms of the trust documents and causes the trust funds to be lost, the trustee (beneficiary) shall bear part of the losses;

If the trustee (trust and investment company) disposes of the trust property in violation of the trust purpose or loses the trust property due to violation of management duties or improper handling of trust affairs, the client (beneficiary) has the right to apply to the people's court to revoke the punishment and has the right to request The trustee restores the original state of the trust property or pays compensation; if there is any gross negligence, the client (beneficiary) has the right to dismiss the trustee in accordance with the provisions of the trust document, or apply to the people's court to dismiss the trustee.

The essence of trust business is the trustee's trust and financial management on behalf of the trustee. As the trustee, the trust company must manage, use and dispose of the trust property strictly in accordance with the provisions of the trust documents. The gains or losses caused thereby shall be borne by the trust property. .

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The trust company's operating losses and failures will not affect the trust property (the client's funds).

According to the "Trust Law", a trust company shall separately manage and keep accounts of the trust property and its inherent property. Trust property does not belong to the trust company's own assets and does not participate in liquidation. If a trust company has mismanaged, closed down or went bankrupt, the trust property shall be transferred to another company, so that the management of the trust property is continuous and effective.