Research On The Legal Supervision Of Private Equity Founds

With the rapid development of Private Equity Funds (PE) in China, China’s lawsare facing the lack of provisions about the PE’s existence and operation. The2008financial "tsunami" had triggered a new round of discussion about the financialregulation internationally. Domestic academia and practice circles also had raised theheated discussion about the effective regulation of the PE. This paper mainlydemonstrates the PE from the perspective of supervision. We base on the ChinesePE’s situation of development and take the developed countries’ supervision strategieswith Chinese for comparison. And hope we can learn some lessons from othercountries’ method. Consequently, firstly this thesis discusses the subject not only fromthe macro and regulatory ideas, but also from the specific legislation and policies ofregulatory. The article puts forward some solutions in allusion to Chinese PE’sadverse conditions and problems which is caused by no rule to follow and lackinglegal basis for supervision. The solutions lay stress on the idea of the protection ofinvestors and advocate various progress, including improving the regulatory thinkingand strategies, completing the information disclosure system, changing the situationof each department acting on its own which caused the PE at a loss. The paper isexpected to provide some suggestions on China’s supervision and contribute to thefurtherance of PE’s development. At last we hope the regulatory authorities can assoon as possible sort out a clear and effective management ideas, and implement theappropriate and reasonable regulation, so that it can promote the PE’s long-term andhealthy development. This thesis is divided into five parts to analysis and study of the PE’s legal andregulatory issues. The introductory briefly introduces the development of the PE andits great significance as an important link between the financial capital and theindustrial capital of China’s capital market. Although the PE means a lot to Chineseeconomy and capital market, it is facing the problems of legal and regulatory gaps.The foreword mainly educes the necessary of writing the paper.The first chapter mainly introduces the basic theory of the PE, including thedefinition of PE, the basic characteristics, the main forms of organization and themode of operation.The second chapter is an overview for the PE’s current situation in China, inparticular，its three-decade course of development in China and the current situationof the development, and the beneficial and adverse effects on Chinese economy andthe financial market. We are looking forward to understanding of the development ofChina’s PE from a historical, objective and comprehensive perspective.The third chapter selected four countries as a comparison object from the angleof the horizontal. Specifically, the United States, Britain, Japan and Germany, who’sPE had developed into a higher degree. Through analyzing separately these countries’regulatory strategy, we can draw some lessons from their supervision of PE, whichalso can provide a useful reference for our legislation and regulation.The forth chapter is about the sorting and classification of Chinese PE’s currentlaws, regulations and policies. This chapter focuses on the current situation of thesupervision and Chinese PE’s primal problems.The fifth chapter is aim to provide some recommendations to promoting theregulatory process of Chinese PE in allusion to the above situations and problemsfaced by Chinese PE. In particular, the suggestions include advocating theharmonization of legislation, improving the regulatory strategies and measures inconsideration of China’s actualities.