China Securities Regulatory Commission: Seven aspects of policy to support the development of private equity fund industry

2016-06-27 10:17

First, on the basis of clearing private equity fund, venture capital recovery, and NEEQ policy, actively to carry out well service and guidance work on follow up financing and investment operation.

Second, on the basis of clear principle private equity fund management organizations marketing on NEEQ, to encourage qualified institutions to further improve the management level by making the market.

Third, to further promote qualified private equity fund management institutions to apply for public fund management business license.

Fourth, to promote private equity funds of various forms of organization, such as corporate type, partnership type to create a fair tax environment.

Fifth, under the premise of risk controllable, to further promote the proportion of insurance funds, the national social security fund investment private equity funds, and encourage enterprise annuity and other long-term capitals to  invest venture capital funds.

Sixth, to encourage venture capital institutions to develop fund products to meet the needs of supporting innovation and entrepreneurship, study to issue stock bond products, and improve the fund-raising ability of venture capital institutions.

Seventh, to support qualified private equity fund management institutions to carry out overseas investment business in a timely manner.

In terms of regulation, CSRC would focus on building a suitable and effective regulatory and self regulatory system in line with the characteristics of private equity funds in China from the following aspects. Improving the qualified investors system, regulating private equity fund raising behavior, so as to effectively prevent illegal fund-raising.

First, to accurately grasp the market entry system, which can not only maintain the vitality and efficiency of the market, but also improve the management level of institutional norms in the enter link. In view of private equity fund investors are qualified investors, so CSRC does not conduct pre approval to the establishment of private equity fund managers institution and private equity fund, but take the post registration system. Meanwhile, in order to ensure private equity fund professional compliance operation, and safeguard the legitimate rights and interests of investors, it is necessary to regulate the franchise, compliance and qualification of employees of private equity fund managers.

Second, to improve the qualified investors system, regulate private equity fund raising behavior, effectively prevent illegal fund-raising. Only the effective implementation of the system of qualified investors, can ave a realistic foundation on the appropriate supervision of private equity funds.  

Third, to strengthen infrastructure construction, improve the risk monitoring system. CSRC is now studying and developing private equity fund supervision information system, and on the basis of establishing and improving the risk monitoring index system of private equity funds, to grasp industry development status in time.

Fourth, to strengthen post regulation, so as to force market institutions to establish a sense of compliance in advance. The CSRC had issued relevant measures since last year, striving to build a three-dimensional inspection system including institutional self-inspection, random inspection and special inspection, and speeding up the establishment of private equity fund emergency response mechanism.

Fifth, to explore classification regulation, establish a trustworthy incentive, credit constraint mechanism for private agencies. Because, the integrity is the lifeline of the sustainable development of private institutions.