The Legislative Improvement For Qualified Investor Of Private Equity

Private equity investment fund(Private Equity)began from the 40 s last century,is a fund facing specific institutions or individuals to raise capital,and frequently operated by professional fund manager to choose these companies or projects with growth potential,then transfers its stock through a string of well-timed acquisitionsr or IPO to obtain the highest returns,compared with the public fund.The private equity investment fund starts very late,but has developed rapidly.Less than half a century,it has been around the world.In essence,the private equity investment fund belongs to the securities issuing mode facing particular private investors.At this point,there is a fundamental difference between the private equity fund and the public offering fund.However,the traditional form is changing under the tide of contemporary financial innovation.In some foreign countries,some private equity investment funds have begun to go public to raise funds in order to achieve long time development,standardize corporate governance and fund operation,improve the visibility and the financing capacity.In China,this type of private equity investment fund has also appeared,for example,JD Capital(its full name Kunwu Jiuding Capital Holdings Co.,Ltd)is a Chinese private equity(PE)investment and management agency went public on the Shanghai Stock Exchange(600053.SH.).JD Capital is a comprehensive finance and investment member company held by Jiuding Group(430719.OC).In China,the development of the private equity capital market is closely related to the government's policy guidance to promote the transformation of science and technology into the productive forces.China new technology venture capital company,the first private equity investment institution in China,was setted by the national Ministry of science and Technology(the predecessor State Science and technology)to promote the development of high-tech products under the guidance of the policy recommendations.The development of China's private equity has gone three stages: absorption,introduction,and rapid development.In 2007,the limited partnership law established the legal form of limited partnerships,and private equity funds have got the fast development in recent years.In 2016,the first time,private equity funds went beyond the public fund in raising funds,but still many legal problems,such as qualified investors,and a large number of domestic commercial banks,insurance companies can not directly participate in the private equity investment fund.More and more natural person investors who were kept from the private equity investment fund has become common,so how to regulate and guide?Based on carefully reading China Securities Law,Securities investment fund law,Company Law,Provisional Rules of Administration of Venture Investment Companies,Trust funds set Trust programme management methods,Interim Measures for supervision and administration of private equity funds,Management measures of private equity fund raising behavior and other relevant laws,combining with the fact of private equity investment fund investors who are being chosen and starting from the practical problems in China's current private equity investment fund,this paper offers some constructive suggestions,according to the basic theory of regulation and learning from foreign experience.This article attempts to discuss the legal issues of the regulation of qualified investors in China through three parts.The first part focuses on the basic characteristics of private equity funds,types and the legal system of qualified investors,theory and reality basis.First of all,the concept and types of private equity funds are defined to define the scope of the problem.Secondly,by introducing the concept of qualified investors,the artticle will continue to explore the theoretical and practical basis of the establishment of private equity investment fund system of qualified investors.There are three main points: the requirement of the operational characteristics of private equity investment,the core concept of qualified investors and financial regulatory system in China,The second part mainly analyse the obstacles why a large number of domestic commercial banks,insurance companies can not directly participate in the private equity investment fund investment by other forms of participation in investment,and legislative defects about natural person investors in private equity investment through the introduction of China's relevant legislation provisions of qualified investors,combing the specific provisions about institutional investors and personal investors in at the present stage.In the third part,on the premise of analyzing the defects and shortcomings of the legislation of qualified investors of private equity funds in China,and combining the mature experience of the relevant systems of various countries,the artcile will put forward some legislative,for example,softens the terms of domestic commercial banks and insurance companies to invest directly in the field conditions.And the definition of qualified investors of natural persons can not only consider the bottom line of assets,but also examine their rationality of investment.The relevant information disclosure and investment decision-making mechanisms still need to improve.On the supervision issue,it is necessary to strengthen the self-discipline construction of the fund industry besides the unilateral act of the law enforcement agencies.