The Legal Issues Of Issuing Funds Abroad

Reviewing these years of development the fund industry has achieved, we find that the capital market has experienced a step-by-step process of opening up. At first, the market was opened to Qualified Foreign Institutional Investors (QFII). Then Qualified Domestic Institutional Investors (QDII) were allowed to invest in overseas market. The aforesaid two opening-up measures have achieved success. According to the WTO Agreement China has signed and equivalence principles, the securities service industry of China may enter the financial market of other countries that entered into the Agreement and enjoy the same treatment. With the process of opening-up of Chinese capital market, it will be a general trend that domestic fund management companies exploit business abroad. This is what the fund industry focuses on currently.This article will elaborate the legal system for Chinese fund management companies issuing funds abroad and take European Union as an example. The author seeks the most suitable mode for Chinese fund management companies issuing funds in Europe Union through the analysis of the legal system of investment fund in EU, the type of funds to be issued, corresponding regulatory model and the preparation for issuing funds. When the laws and regulations are ready and chance comes, the author hopes that the article may provide reference for domestic fund management companies to exploit business internationally. This article is constituted of four chapters.In Chapter 1, the author explains the meaning for issuing funds abroad and the experiences of others. She introduces the background of the internationalization development of China fund industry, the commitment China has made in WTO Agreement, and etc. As to the experiences of others, the author first states the pace of opening-up of the China capital market and international experience of opening-up of the fund industry and takes the emerging financial market of Korea and China Taiwan as examples to illustrate how developing countries promote the development of securities market and fund industry through internationalization.In Chapter 2, the author analyzes the legal system of European investment fund and how the European supervises the issuing of foreign funds. The author first explains the advantage of issuing funds in EU, in other words, why selecting EU, and then reviews the history of formation of EU single market. The author hopes that through her analysis of the legal system of European investment fund, regulatory legislation and regulatory authority, the reader may know something about the legal system of European investment fund.Chapter 3 is about the domestic supervision of issuing funds abroad and is composed of three parts: general legal supervision system of domestic funds; legal supervision system of overseas funds and the perfection of the supervision over issuing funds abroad. Based on the fact that the legal provisions are blank in the area of issuing funds abroad, the author therefore illustrate the supervision system of issuing securities abroad for reference, which is similar with the funds.Chapter 4 is about the legal affairs of issuing funds abroad, including the satisfaction of the requirement of the place of issue in EU, surmounting the legal obstacles in China, the process of issuing funds abroad and the experience of others. In this Chapter, the author provides some operational suggestions and ideas for reference and further discussion.