"Interim Measures for the Supervision and Management of Private Equity Funds (Draft for Comment)"

Lu Yaqiong

Recently, the CSRC released the Interim Measures for the Supervision and Administration of Private Equity Funds (Draft for Comment) (the "Interim Measures"), which solicited public opinions from the public and made detailed provisions on the ways of raising funds, qualifications of investors and investment modes of operation .

The Interim Measures will be private equity funds, private equity funds and venture capital funds, as well as the market for art, wine and other types of private equity funds for investment into the scope of the new regulations are included in the scope of adjustment to the company, the form of partnership private equity The same applies to funds (except contractual funds). In addition, securities companies, fund management companies, futures companies and their subsidiaries engaged in private equity funds also apply the "Interim Measures."

This also means that has long been in the private regulatory written long bullpen areas, including PE / VC will be incorporated into a unified regulatory system, the long-term stable development with the system to protect, and brokers direct investment subsidiaries, fund subsidiaries, etc. from This station on the same starting line. A number of interviewed PE / VC people told the "First Financial Daily" that moderate regulation is a long-term good for the healthy and transparent development of the industry. However, the implementation of the new regulations and the regulatory efforts in the future are yet to be further observed.

Long-term unified supervision is good

"PE / VC into the securities regulatory system for the industry in the long term, it must be a good thing." Shanghai fulcrum Investment Management Co., Ltd. Investment Manager Chen Canming said.

Earlier, under the NDRC filing system, the PE / VC actually departed from regulation and dominated itself. "A few years ago in irrational high-yield market competition, illegal or even outbreak of the entire industry continue to negative news.For example, local governments to tax breaks, the introduction of preferential tax policies to introduce PE or VC, as the incubation of local businesses Funds, but these fund companies may hold investors' money to pursue other projects that are "short and fast" and the money has not entered the real economy at all and brings about a series of problems, "said Chen Canming.

In 2005, the NDRC and other 10 ministries and commissions jointly released the Interim Measures for the Administration of Venture Capital Enterprises, setting out the relevant rules for the establishment and filing, investment operation, policy support and supervision of venture capital enterprises in the form of laws. In August 2008, the NDRC changed the management of industrial funds from "examination and approval system" to "filing system."

Shanghai Shi Shi Investment Management Co., Ltd. stakeholders told reporters that such supervision is similar to nothing. "The implementation of the newspaper system, but some products are reported, and some are not reported, it is in a state of almost no one tube."

In a "very relaxed" environment, PE / VC experienced a period of "golden period of development." However, with the gradual exposure of the problem, the entire industry from 2012 to 2013 also fell into a deep "consolidation".

February 7 this year, led by the China Association of Fund-backed private fund registration officially started, will have a lot of time before the NDRC regulatory oversight transferred to the hands of the Commission. As of July 4, the registered private fund managers totaled 3563 and management funds amounted to 5,232, with a management scale of 1.98 trillion yuan.

At the same time of intense registration and filing, the interim measures for the management of private placement investment funds drafted by the CSRC are also accelerating. The SFC said that before the introduction of the Provisional Private Equity Fund Interim Provisions, private equity investment funds and private equity funds have urgent regulatory needs. The deadline for the "Interim Measures" to publicly solicit opinions from the public is August 10.

Moderate regulatory flexibility considerations

"Regulatory flexibility or to grasp the primary market and the secondary market is not the same.PE / VC into a unified securities regulatory system, binding is not a bad thing." Shanghai PE head of a "First Financial Daily" said .

The aforementioned Shihshi investment-related sources said the new regulations will be included in the unified supervision of the PE business, but now almost to the fund industry associations are private equity sunshine management agencies, PE / VC is relatively small. "It is understood that many brokerage firms have not implemented a newspaper-related business .Classification of regulatory or unified supervision, but also see less clear .However, it seems that there is no need for complete reunification, brokerage and fund subsidiaries have also been supervised Within the system. "He told reporters some questions.

In fact, when a general manager of a securities brokerage firm compared the strengths and weaknesses of securities firms with PE and independent PE firms, he also said that one of the major advantages of PE firms is the "flexibility" of regulation.

So, if the SFC to implement a unified supervision, PE / VC institutions will not be blindfolded so that the side of a good brokerage or fund PE?

A broker direct investment subsidiary official told reporters that the fundamentals of the external environment has not changed, but more than a filing procedure. This screening of the project capacity, fund-raising management capabilities and will not bring change. So in the short term there is not much impact on the industry. However, in the long run, it is beneficial to enhance the market standardization and transparency of the industry and also help the regulatory authorities to grasp the asset trends.