Study On Legal Issues Of Pledge Of The Share Of Limited Partnership Private Equity Found In China

After the amendment in 2015,Securities Investment Fund Law formally incorporated “private equity found” into supervision,which marks the arrival of a brand-new era of private equity.The rapid development of private equity found indicates directions for widening the new financing ways of SMEs(small and medium-sized enterprises).In practice,limited partnerships are favored by many private equity found by virtue of its simple establishment,low operating cost,flexible benefit distribution ways and other advantages.However,the long investment cycle of private equity found and slackening IPO speed get them into dilemmas when pulling out.Under this type of economic situation,investors demand for pledge financing,attempting to relieve their own capital flow pressure through the pledge of partnership share.Yet,the incomplete stipulations of limited partnership private equity found unit pledge at the legislative level and pledge uncertainties would trigger many potential risks.Currently,the parties can not complete the establishment through the pledge registration and the rights and interests of pledgees can not protected through publicity,except for the privately-signed pledge contract.In this connection,the registration agencies take whether the so-called “no legal basis” can be used to reject registration as the root cause for the difficult establishment of the guarantees.In the final analysis,the following problems should be handled at first.Do the legal pledge rights include the private equity found shares? Is the pledge established by registration or delivery?If it is established through registration,which is the legal authorized registration authority? In view of these problems,this paper analyzes them one by one.Chapter one introduces the basic concepts relevant to the limited partnership private equity found share pledge,like types,pledge system,pledge features and other basic theories.Meanwhile,it discusses the merits and demerits of the new-type pledge;it mainly focuses on the economic benefits and potential risks behind the pledge.Chapter two conducts in-depth analysis in view of the feasibility of the pledge.Firstly,it excludes the guarantees set by other two ways and explains the specific reasons.Then,in accordance with the legal foundation of the pledge,it identifies the nature of limited partnership privately-offered fund share pledge as the mortgage,analyzing the property,transferability and pledge ability of the pledges.At last,it teases the legislation status of the pledge system relevant to the new-type pledge of rights and combines the preceding identification of its nature to summarize the differences among them,discussing that realization of pledge has a certain legal basis from the perspective of legality.Chapter three probes deeply into the legal orientation confusion and difficult system implementation relevant to limited partnership privately-offered fund share pledge in China.The author explains that there are differences on the important establishment documents of private equity found share pledge through a typical case.Meanwhile,it also reveals the disunity of registration institutions,legal barriers short of credibility as well as the huge risks of mortgagees' interests due to the repeated pledge and incomplete information disclosure.Chapter four is the conclusion of this paper.Under the premise of affirming that the limited partnership private equity found share pledge has no obstacle in terms of theory and system implementation,it proposes the suggestions and ways for clarifying and perfecting the pledge system.In the first place,important documents are set for the name rectification,affirmation and registration of the privately-offered fund share nature through legal amendments or judicial interpretations.Secondly,the author puts forward some suggestions on solving the registration obstacle quickly by authorizing multi-sector joint registrations,namely,Asset Management Association of China and CSDC.To make the proposal,the author takes considerations from the following three aspects.On one hand,it is used to avoid the fact that focus on a single registration agency causes the decreasing transactional efficiency;on the other,it can ensure that the authorized registration authority can play a strong publicity role.Finally,in view of the specialty and complexity of privately-offered fund,the supervision of Asset Management Association of China must provide some support.The author also puts forward the method of controlling multiple risks in the course of pledge.From the perspective of protecting the rights and interests of the mortgagees,it is difficult to obtain information from outside due to the high information confidentiality of private equity found.All information obtained must be true and accurate through compulsory disclosure of information to the mortgagee.The information disclosure system is also beneficial to external supervision,preventing fund managers from disclosing information in a comprehensive,untrue and timely manner;furthermore,it can urge fund managers to fulfill their obligations of continuous disclosure,in order to protect the mortgagee to the maximum extent.Thus,mortgagees should take the initiative to conduct prior examination.The above-mentioned are the suggestions proposed to ensure the smooth development of the pledge of private equity found share.This paper desires to get rid of the existing pledge dilemma as soon as possible through these measures.