The extraterritorial application of the securities laws is the inevitable outcome of the securities market internationalization. It has its own basis and conditions for its exist. Yet to some extent, the very exist of extraterritorial application of one state’s securities laws has changed the basis of national jurisdiction, and has brought about some negative effect on other state’s sovereignty and national interests. That is to say, the extraterritorial application of domestic securities laws can certainly give rise to the conflicts of jurisdictions, and have to face the difficulty of enforcement.
Therefore, the real problem is how to understand the conflicts and difficulties brought by the extraterritorial application of domestic securities laws and the exercise of domestic supervision power, and how to harmonize the securities legislation in different countries, so as to reasonably and properly reflect the real legal demand of Securities Market Internationalization.
Besides, as the standards for the judgement of Extraterritorial Application of the securities laws are mainly the effect test and the conduct test, it is easier to satisfy these standards for the on-line securities business because of its borderlessness. And this makes the domestic law more likely to be applicated abroad. In this sense, securities business over the internet cannot be supervised in the traditional way. The states in the world should keep harmonizing and improving their securities laws and regulations, to achieve a more compatible supervision mechanism over on-line securities business and to avoid the excessive extraterritorial application of domestic securities laws.
At the present time, the Chinese Securities Market is in the process of Internationalization, and the Chinese securities law is going to be amended, so it is the high time to establish Chinese legal mechanism of extraterritorial application of securities laws and regulations.
Therefore, the real problem is how to understand the conflicts and difficulties brought by the extraterritorial application of domestic securities laws and the exercise of domestic supervision power, and how to harmonize the securities legislation in different countries, so as to reasonably and properly reflect the real legal demand of Securities Market Internationalization.
Besides, as the standards for the judgement of Extraterritorial Application of the securities laws are mainly the effect test and the conduct test, it is easier to satisfy these standards for the on-line securities business because of its borderlessness. And this makes the domestic law more likely to be applicated abroad. In this sense, securities business over the internet cannot be supervised in the traditional way. The states in the world should keep harmonizing and improving their securities laws and regulations, to achieve a more compatible supervision mechanism over on-line securities business and to avoid the excessive extraterritorial application of domestic securities laws.
At the present time, the Chinese Securities Market is in the process of Internationalization, and the Chinese securities law is going to be amended, so it is the high time to establish Chinese legal mechanism of extraterritorial application of securities laws and regulations.