On The Corporate Legal System Of Securities Investment Funds

The history of securities investment fund in China is very short. The Law of the PRC Securities Investment Fund was implemented on 1 June 2004, which has confirmed position of securities investment fund and its impact on our capital market by means of law. It is an important milestone in the history of development of our industry of securities investment fund. During the development period of our fund industry, rat-trading of fund as a tough disease has greatly threatened the benefits of our fund investors and fund share holders, which will of course influence our continuing and health development of fund industry. The 2010 work conference of supervision and administration of securities and future trading was taken place in Beijing on 13th and 14th January 2010. China Securities Regulatory Commission has expressed that it will take more strict actions against illegal activities especially rat-trading and insider-trading. The author takes the view that, the reason why rat-trading of fund is so difficult to be prevented and treated nowadays is that, to the most extent, our legal regime of securities investment fund is not so well-formed or developed.By four chapters in total, the author states that, in order to better prevent and manage rat-trading of fund, we must introduce and establish the legal regime of corporate-type investment fund on the basis of the legal regime of contractual-type investment fund we are currently applying.In ChapterⅠ, this thesis for Master Degree (the Thesis) introduces the rat-trading of fund, makes analysis of the reasons to cause rat-trading from three aspects:(1) imperfect of our current legal regime of securities investment fund; (2) inefficacy of our outside supervision to rat-trading of fund; and (3) unreasonable inner management system of our fund management company. In addition, the author restates the difficulties of preventing and managing rat-trading of fund under our current legal regime of securities investment fund from the perspectives of discovery, proof and punishment of rat-trading of fund. And therefore, it proves the shortcomings of our current contractual-type investment fund and importance and emergency of introduction of legal regime of corporate-type investment fund.In ChapterⅡ, in order to introduce legal regime of corporate-type investment fund, the author enhances the advantages of legal regime of corporate-type investment fund from the point of the weakness of our current legal regime of contractual-type investment fund, by comparison of which, the legal regime of corporate-type investment fund can better prevent and manage rat-trading of fund. In ChapterⅢ, the author learns and refers to the legal regime of corporate-type investment fund from the western countries (such as the United States and the United Kingdom) by introducing its beginning and development. Though horizontal comparison, it points out those key aspects that we should learn from the western countries when we are introducing and establishing the legal regime of corporate-type investment fund.In ChapterⅣ, the author specifies the feasibility of introduction and establishment of corporate-type investment fund in order to prevent and manage rat-trading of fund in an efficient and timely manner, from the perspectives of the emergency of managing rat-trading of fund, the possibilities for us to introduce and establish legal regime of corporate-type investment fund on the basis of our current legal regime of securities investment fund and the importance for the continue health development of our investment fund industry.