Research On Legal Supervision Of Private Equity

As an important force in the international financial markets, private equity hassprung up everywhere in recent years. It plays an increasingly important role ineconomic life, which has become the third-largest finance market players after bankcredit and securities markets. In some way, private equity has been occupied a veryimportant position in China’s capital market, and it is increasingly significant impactincluding positive and negative for China’s investment market and the real economy.China’s private equity is still in a gray area and the edge of the law, which has a lot ofproblems and deficiencies in its spontaneous process. Therefore, it is becoming apressing issue to regulate private equity. So how to regulate private equity is a coreproblem that needs us to settle.First, though comparative analysis the self-regulatory model of UK, thegovernment combined self-regulatory model of U.S. and the government regulatorysystem in Japan, and summing up the three countries experiences and lessons over theyears, I try to explore suitable private equity supervision mode in China. Then, fromthe supervision of exploration, the preliminary development and gradually perfectthree stages of China’s private equity supervision, leads to legal system of thesupervision is not in place, supervision department and regulator focus is not clear, thelack of a unified industry self-regulatory, the fund operation is not standard and exitmechanism is not perfect etc problems. For these problems in the supervision of theprivate equity, the author put forward some specific suggestions which includeimprovement the supervision legal system, define government regulatory authorities,strengthen self-discipline, clear regulatory object, strengthen the supervision of theoperation in the fund process, improve the exit mechanism and other auxiliaryregulatory measures for private equity supervision.For the private equity regulatory model, the author thinks it is a wise choice tochoose the U.S. model. The U.S. model has some advantages which use acombination of governmental and self-regulatory mode, combine with the authorityof the government regulation, and it also has macro、aloofness and the freedom andflexibility of self-regulatory. These advantages play an importance role in theregulatory body, and create a relaxed environment for the specification anddevelopment of the private equity. So that the private equity gets the healthy, orderlyand rapid development, and takes full playing in the positive role. Therefore, at present, we should make full use of the regulatory role of the government and industryself-regulation on the basis of the perfect laws to achieve regulation of private equity.Of course, with the continuous development of the private equity, the regulatorysystem should be "with the times" to adjust constantly.