On Research Of Legal Regulation Of Private Equity Investment Funds

Private equity funds is increasing access to people of all ages because of their higher expected returns, however, high return is always accompanied by high risk. Its essential character is that of "registered exemption",in order to save costs, private equity investors Prefer to give up its "liquidity" for "registered exemption",Freedom is the vitality of private equity, public authority should not have too much interference in it, but as the economic conditions in the domestic market as well as its own special risk, its regulation is an inevitable trend.The concepts of private equity funds In domestic laws and regulations are different, some define it as an organization, some define it as a thing, I believe it refers to a private equity fund based on the established investment objectives, by the way of non-public offering to raise specific object of the collection of funds or assets, its fund assets by fund managers in accordance with the portfolio approach to increasing the value of management, holders share fund in accordance with the share they hold and enjoy the benefits risk.Due to its high risk of relying solely on market mechanisms, or rely on their own autonomy it can not development healthly, whether the public interest, the social costs of market failure, or from speaking, to regulate it is essential for its regulation, it is helpful to prevent and defuse financial risks and maintain financial order and efficiency of the market order. Domestic regulation for private equity funds are scattered among different laws and regulations, look at the provisions of the domestic, private equity funds do not have a legal status, for the regulation of private equity fund focused primarily on the qualifications of the sponsor, this should be As a private equity fund investors an important part of the eligibility requirements less provisions for raising too principled way, not operational.By Contrast, foreign and Hong Kong and Taiwan on China's private equity fund regulatory legislation the legal system, the United States focused on the behavior of investors, restrictions on eligibility and release, that only qualified investors and investment relations as well as mature persons belonging to a certain degree of capital conditions and the investment experience of the subject to be eligible to invest in private equity funds, for the issue of the manner of expression in the range of investors and the prohibition of advertising defined in terms of the way, and the sponsor of the restriction is limited to moral tainted were excluded. UK regulatory law mainly in qualified buyers and advertising are two aspects of communication, and Japan focused on the restrictions on the private placement of objects. This shows that other countries and regions monitoring private equity fund focused primarily on investors and raising methods, and regulatory structures to government regulation and industry self-discipline combined.The author believes that China's private equity fund construction of legal system supervision of specific programs should include the following three aspects:First, private equity funds on regulatory principles. Private equity funds because of "freedom" of the essential characteristics of, I believe that the regulation of the private equity funds should be limited within a certain range, it should be in line with proper regulation and the principles of fairness and impartiality. The second is the regulatory structure of private equity funds, private equity funds within the agreement and the mode of operation is to free consultation from the investor and manager made reflects the party autonomy, should emphasize the autonomy of the parties, the government's excessive regulation will hinder the smooth development, but the lack of a lot, actually monitoring effort, entirely on the market mechanism itself, there will be market failure, so I think that our private equity fund business to implement government regulation and industry self-regulatory system combined. Three private equity funds on a specific regulatory system design. I believe that, should the identification from the private equity, the issuer administrator qualifications, and organizational forms to carry out three specific system construction. Finally, the author according to the domestic private equity fund market development, should establish a certain degree of risk prevention system to ensure the healthy and smooth development of private equity funds.The private funds will not happen quickly for Chinese condition monitoring system,it is a gradual process, I will study and work in the future to do further analysis and study, do my best for a good private equity funds to build a legal environment a good legal environment, so as to better enrich our country's financial markets, protect the legitimate rights and interests of investors contribute their efforts.