The Improvement Of Private Equity Fund Industry’s Self-regulatory Mechanism

In recent years, private equity fund in China is booming, set off a wave of private heat. In sharp contrast with the rapid growth of private equity fund, legislation and regulatory are lag behind. Private equity fund is important to economic growth and economic transformation, but it also builts high risk. The government is hard to regulate private equity fund effectively. Therefore, this article attempts to study another regulatory approach-industry self-regulatory, committed to the healthy development of private equity fund industry. This text is divided into four parts.The first part, theory of private equity fund industry’s self-regulatory mechanism. First of all, define the self-regulatory of industry, it refers to restrict and manage within the industry. Secondly, define the self-regulatory mechanism of private equity industry. Private equity fund industry association is the subject of self-regulatory, industry association formulate a series of self-regulatory rule, through the interaction of various self-regulatory rules, to achieve self-regulatory function. Lastly, set forth the theory of industry self-regulatory from economics, sociology and law perspective. Because of market failure and government failure, industry association is built to promote economic development. In addition, industry association is the basic strength of civil society, promote the process of political democratization.The second part, the dilemma of private equity fund industry’s self-regulatory mechanism. First of all, introduce the development and the problem of private equity fund, so it is necessary to build industry self-regulatory. Secondly, describe the fact that private equity fund industry association is lag behind. Through analyze the private equity fund industry association of Tianjin, Beijing, Shanghai and other economic developed areas, we know that these private equity industry associations still have many shortages, such as lack of independence and not pay attention to self-regulatory. Because the organization of China Association of Private Equity is imperfect, not yet play industry self-regulatory function effectively.The third part, study and learn the private equity industry’s self-regulatory mechanism from other countries and areas. Through analyze the American Venture Capital Association (NVCA), the European Venture Capital Association (EVCA) Taiwan Venture Capital Association of Business, you can learn that scientific and rational organization structure, advanced investment concept, improved industry self-regulatory rules are important to self-regulatory. These mature industry associations provide a template and experience to our private equity fund industry self-regulatory mechanism. The fourth part, the improvement of our private equity fund industry self-regulatory mechanism. First of all, legislation is the premise of the private equity fund industry’s self-regulatory mechanism to play effectively. Secondly, establish the framework of "industry self-regulatory based, government regulation supplemented ", distinguish the boundary of government regulation, in order to define the responsibility of industry self-regulatory. Thirdly, we should establish a scientific and rational organization, with the advanced investment philosophy. Fourth, establish and improve industry self-regulatory rules. Including the private equity industry association responsibility rule, fund manager credit rule, dispute resolution rule, punishment and incentive rule, these rules are like the branches of trees, to build the tree of the industry self-regulatory mechanism.