Study Of The Legal Status Of Fund Managers

The fund manager is the employee of fund administrators who deal with the management and operation affairs directly or indirectly. As the employee of fund administrators, fund manager is the related party of fund administrators. As in direct charge of fund investment, comparing with other parties, fund manager has great influence on the interest of fund shareholder.The relations among fund managers, fund custodian, fund shareholders are contractual relationship. The relations between fund manager and fund administrator are employment relations. The relations between fund manager and fund custodians are trusteeship relations. The relations between fund manager and fund shareholders are entrustment relations. The rights, obligations and liabilities of management and operation derive from the agreement of contract. The fund manager should manage the fund assets under the restriction of the fund contracts, regulations and laws.This paper has four parts as follows:The first part contains the concept of fund manager and the analysis of the legal status of fund manager. This part elaborated the legal connotations of fund, manager and fund manager, differentiated and analyzed the relations between fund manager and corporate managers, fund administrators, fund custodians and fund shareholders.The second part analyzes the overseas countries'legal status of fund managers. It introduces the regulations and laws about the fund manager in the United States, Japan, Hong Kong and Taiwan.The third part analyzes the problems and causes of the regulations and laws about fund manager in China. It explains the rights and obligations and the liability of fund manager. The legislation imperfections in the rights of fund manager are deficiency in incentive system and rights lack deriving from the restriction on the trading activities of fund managers. The legislation imperfections in the liabilities of fund manager are imperfections in legal system about the fund managers, deficiencies of regulations about the obligations in disclosure information, insufficiency in protecting investor'interests under current responsibility principle of tort and limitation in civil action mechanism against violations of fund manager. At last this part also analyzes the causes of the legislation imperfections.The fourth part put forward several improvements on the regulations and laws of fund manager in China. These improvements are rational design of the proposed incentive mechanism for public offering fund managers, the establishment of long-term equity incentive mechanism for fund managers and scientific system on fund and fund manager evaluation. I suggest some improvements on the framework of rights of fund managers such as changing the absolute prohibition of individual transactions to proper permission. I also suggest amendment "Securities Investment Fund Law" and other relevant laws and regulations, timely establishment of a fund manager's information disclosure system, the presumption to be attributable to the principle of fault, improvement in civil action mechanism about violations of fund manager to compensate the insufficiency of statutory obligations and liabilities of fund managers.