China Private Equity Investment Fund Industry Self-regulation

Private equity fund is a kind of investment tool which is very active in the capital market now. It also developed rapidly in China in the past a few years. Private equity invests in non-public equities, and earns money through the creation of value. The fund can be marked by the features of privacy, flexibility and risk. Because the private equity market is not that mature in China, self-discipline is needed. This thesis focuses on the self-discipline of the private equity industry.The thesis includes three parts, namely introduction, main body of the thesis and the conclusion. The introductory part introduces the development of the private equity industry, the significances of the industry and expounds on how the issues of this article has been raised.The main body of the thesis is divided into four parts. The first part illustrates the economic and juristic theories of the self-discipline. The market failure and government failure cannot be avoided in the private equity market. The self-discipline is a way to realize order and justice of the society.The second part analyses the current situation of self-discipline of the private equity industry in China and the problems existed in it. There are only several local private equity associations now, which is not that independent of the government. The existing associations pay more attention to serving their members, not self-discipline. Therefore, an independent, country-level private equity association is badly in need.The third part is a summery of private equity associations in foreign countries. Analyze NVCA(USA), BVCA(UK) and EVCA(EU) in different aspects, such as the structure of the association, the patterns of self-discipline, and so on, in the aim of helping the development of the association in China.The last part tried to construct a system of the self-discipline in private equity association on the basis of the autonomous rights, including the division between the self-discipline and government regulation, the aim and mission of the association, the improve and perfect of the association's structure, the management of the members and a series of specific autonomous rights.On the basis of the above-mentioned reasoning, the following conclusion has been drawn:because of the features of the private equity funds and the limited development of the private equity industry in China, the actives of self-discipline are desired in the frame of laws. An independent, country-level private equity association is expected both by the market and government. The association will play an important role in the development of the industry, the protection of stakeholders, and the improvement of the social order and justice.