The Study On The Supervision System Of Private Equity Funds Information Disclosure Regulation

Private Equity Funds have become the world’s second only to banks and IPO financing forms, is also one of the emerging global top five investment power,play an important role in the promotion of economic development and business innovation. Private Equity Funds originated in the United States, have more than70years history, foreign Private Equity Funds are achieved great development in the business model, and the number of scale. The1980s, China’s learn from foreign experience, the introduction of Venture Capital Funds, after nearly30years of development, especially after2005, Private Equity Funds in China booming, the local Private Equity Funds are also a lot of growth.Financial risks causing the demand for financial regulation, financial regulation needs to supply the specific control measures. Along with the rapid development of Private Equity Funds in China, some of the problems exposed, the operational risks of Private Equity Funds causing to the demand for regulation of Private Equity Funds. The lack of information disclosure in the operation of Private Equity Funds has led to some problems. In order to protect investors and maintain the financial stability, need effective supervision for Private Equity Funds information disclosure. In this paper a study on Private Equity Funds disclosure regulation of the legal system will be making.This article is divided into three parts of the introduction, body and conclusion. In which the body is divided into four chapters.The first chapter describes the legal characteristics and the organizational form of Private Equity Funds. First discusses the concept and classification of Private Equity Funds. The legal characteristics of Private Equity Funds have a dual agency relationship, financial intermediaries status. Dual agency relationship refers to the operation of Private Equity Funds investors and fund managers, fund managers with the managers of the invested enterprise, double principal and agent relationship. The organizational form of Private Equity Funds are mainly three kinds, the corporate system, the trust system and the limited partnership. China’s Private Equity Funds form of organization is the corporate system, the development of the partnership of Private Equity Funds after the Partnership Enterprise Law "came into effect in2007to remove institutional barriers, the next the limited partnership will become the mainstream of China’s Private Equity Funds form of organization. Limited partnership Private Equity Funds generally by the general partner and limited partners. The general partner responsible for the management of the partner companies, unlimited liability for debts of the partnership. The limited partners do not participate in enterprise management, limit the amount of capital with limited liability for debts of the partnership.The second chapter analyzes the institutional basis of the information and the operation of the Private Equity Funds. And general merchandise, information is a valuable resource, it can improve the effectiveness and profitability of the economic entities. The role of information, reduce decision-making risks and mistakes of the economic entities, thereby increasing his expected return. Information channels play an important role in the creation of Private Equity Funds. The Private Equity Funds of information channels can be divided into private channels and public channels, information of private sources are high quality, the efficiency of information transmission; information of the public channels are low quality, and low efficiency. Good sources of information can accelerate the speed of Private Equity Funds raised, reducing time of fund-raising, and to improve the efficiency of the creation of Private Equity Funds.The third chapter discusses the status of the development of the Private Equity Funds, the legal risk of the distribution of benefits in the operation of Private Equity Funds and the information disclosure legal risk of Private Equity Funds. The lack of disclosure is a big problem in the operation of the Private Equity Funds. Disclosure of inadequate mainly in two ways, lack disclosure of information to investors, and lack disclosure of information to regulatory authorities. In view of the disclosure risk of insufficient consequences is not easy to control, so it is necessary to establish a Private Equity Funds information disclosure regulatory framework.The fourth chapter discusses how to establish information disclosure regulatory framework and institutional of Private Equity Funds. The regulatory framework should include disclosure of Private Equity Funds subject to the regulations, the operation of the regulatory process, three aspects of the means of supervision. Subject to the regulations including Venture Capital fund, the acquisition of funds, mezzanine type funds and Restructuring funds. Supervision of the operational process consists mainly of regulation on market access, operation, and exit information in the disclosure of Private Equity Funds. Regulatory means government regulation, market constraints and industry self-regulation. China Private Equity Funds information disclosure regulatory regime to establish the two aspects, one of "the Partnership Enterprise Law ",". Company Law ", the" Securities Act "inspection; specific design of the system, for qualified investors administrator to set the threshold; an appropriate degree of information disclosure and risk prompts legal obligation to set the allocation of regulatory functions, coordination and responsibility.