Study Of Private Equity Fund In China Related Legal Issues

Private Equity Fund is the investment fund that collects capital from specific investors by non-public way and then invests private equity. It has characteristics such as high threshold, high efficiency, low supervision, high revenue, high risk on each project, long investment term, low liquidity, and so on. Private Equity Fund is different from Private Fund, PE, Venture Capital and Securities Investment Fund, and includes Chanye Investment Fund. Private Equity Fund can be divided to different kinds by the different private equity it invests: Angel Capital, Venture Capital, Development Capital, Buy-out/in Fund, Reorganization-driven Fund and Mezzanine Capital. It also can be divided to three kinds by its organization structure: Corporation form, trust form and limited partnership. Developing Private Equity Fund has important value to animate financial market, meet investment demands, help small and medium-sized enterprise to grow, safeguard stability of society, achieve innovative country and develop low carbon economic. And Private Equity Fund can't develop healthily without the guide and regulation of law.Company Law, Trust Law and Partnership Enterprise Law in our country correspond with the three types divided according organization structure, provide them the legal base. And more regulations headed by Venture Capital Enterprise Interim Procedure specify the organization structure and operation process of Private Equity Fund in details. But Private Equity Fund in our country still has these legal problems: legal system is not sound, regulations about qualified investor are rough, preferred stock is absent, limited partner's responsibility is unclear, exit mechanism is impeded and supporting mechanism is imperfect. To solve these problems, we have to complete the legal system, regulate the qualified investor minutely, set up the preferred stock institution, indicate the limited partner's responsibility, improve the exit mechanism and supporting mechanism.