The Analysis Of China Legal Regulation For Private Equity Funds

The private equity funds is the investment funds which is raised up by a few individuals or institutional investors through the non-public way. As a new and more flexible forms of investment, private equity funds has developed rapidly and had a very large scale although it appears late in our country. Now the private equity funds have a decisive impact on China capital market, but there are not any laws to specify their position, market access, operation and legal supervision. What is more, many private equity funds are operated illegally with great risk. However, the private equity fund system has been developed well in foreign countries for many years, especially in the United States, private equity fund system has been very sound, which has clear provisions for the qualifications and the number of private equity investors, the private equity fund managers, the private equity distribution methods, the free private equity funds registration and supervision of private equity funds. In view of this, we should learn from the experience of the U.S. subprime mortgage crisis and take the effective means to strengthen the risk control. We should also improve the supporting legislation and establish the legal status of private equity funds and the triple supervision of the SFC, the private equity industry associations and commercial banks. What is more, we should build the private equity fund market access system and rating system in order to achieve the effective control of the risk.