China's campaign-style Internet finance governance: Causes, effects, and lessons learned for new information-based approaches to governance,

Abstract

China's Internet companies and citizens are now world leaders in developing and using the Internet and related information technologies for financial transactions. Accordingly, it is important that China becomes a world leader in identifying challenges posed by Internet finance, and providing law and governance solutions to address these challenges. While the Internet and its associated technologies are now globally available, a core question is whether, and to what extent, regulatory challenges and opportunities are common across different jurisdictions, or whether they reflect local circumstances. In short, an interesting question is what can the world learn from China as it takes the lead in addressing Internet finance challenges, and what can China learn from the world as it seeks to do so?This article first identifies the landscape of China's burgeoning Internet finance market, including key technologies and services and government and nongovernment players. The article then turns to key regulatory challenges, with a focus on factors especially significant in China. The article then examines the “top down” “campaign style” approach to regulation, which is China government's initial response to emerging challenges. Following an analysis of the campaign, some suggestions are then made for future possible governance strategies. We explain how emerging “information” based and experiment-based approaches to governance are drawing on both global and Chinese experiences to harness the capabilities of the Internet and the collective energies of Internet finance enterprises and users to advance the regulation of the China Internet finance system in a way that is conducive to the public interest.