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Do you understand the contents of the new regulations on private investment funds?

The content of private investment fund has not been clearly stipulated and handled by the state, but malicious private investment fund has a negative impact on social stability. Even the pension and 'coffin book' of many elderly people have been cheated by malicious private placement criminals, with a wide range of influence. Recently, the state has finally introduced the relevant contents of the new provisions on private investment fund.

What are the main contents of the new regulations on private investment funds? The measures not only include the promotion of private equity funds, the sale of fund units (equity), the handling of fund unit (equity) subscription / subscription (subscription), redemption (withdrawal) and other fund-raising businesses, but also include the unified collection of private equity funds to raise settlement funds, the distribution of income to investors, the payment of redemption returns, and the distribution of remaining fund assets after fund liquidation.

In view of the above links, the measures mainly clarify the following three aspects:

(1) Definition of private fund raising subject

According to Article 2 of the measures, private fund raising includes two types of subjects:

The first category is the institutions that handle the registration of private fund managers with the China Fund Industry Association, which can raise their own private funds (for private equity investment institutions, private fund managers can only act as managers, or act as general partners of private funds at the same time as managers);

The second category is the institutions that have registered with the China Securities Regulatory Commission and obtained the fund sales business qualification and have become members of the China Fund Industry Association ('fund sales institutions'). They can also raise private funds entrusted by the private fund manager.

In addition to the above two types of subjects, no other institution or individual shall engage in the raising of private equity funds. In other words, the subjects that can legally carry out private fund raising activities are institutions, and no individual shall carry out private fund raising activities.

According to Article 34 of the measures, if the private fund manager entrusts an institution that has not obtained the qualification of fund sales business to raise private funds, the China Fund Industry Association shall not handle the filing business of private funds. Therefore, this article requires the private fund manager to have the obligation to verify the qualification of the entrusted raising institution, otherwise it is likely to bear the consequences of failing to record the fund products, and the failure to record the fund products will have a significant negative impact on its investment activities. In the previous practice, many private fund managers hired financial consulting companies without fund sales business qualification to provide fund-raising services. After the implementation of the measures, these behaviors should be corrected. Therefore, we suggest that in the fund sales agreement, the fund sales agency should make a commitment that it has the fund sales business qualification, and take its qualification certificate as an annex to the sales agreement.

(2) It is expressly prohibited to split fund units or the right of return of fund units

Article 9 of the measures clearly prohibits the splitting of fund units or usufruct in order to avoid the standard of qualified investors. In addition, investors are required to make a written commitment to purchase private equity funds for themselves.

For private equity investment institutions, at present, most organizational forms are limited partnerships. Therefore, private fund managers should pay special attention to some investors who subscribe for fund shares in the form of contractual funds and asset management plans to check whether they have the above illegal splitting. Because contractual funds and asset management plans can gather more investors than simple limited partnerships, they are easy to become the form of illegal splitting.

(3) It is clear that the raising institution shall establish a special account for the raised settlement funds of private equity funds

Articles 12 and 13 of the measures require that the raising institution or the responsible subject agreed in the relevant contract shall open a special account for the raised settlement funds of private equity funds, which shall be used for the unified collection of the raised settlement funds of private equity funds, the distribution of income to investors, the payment of redemption items and the remaining fund property after the liquidation of distribution funds, so as to ensure the return of funds in the original way; Paragraph 2 of Article 12 specially emphasizes that "the raised settlement funds shall belong to the legitimate property of investors before they are transferred from the investor's capital account and reach the private fund property account or custody fund account."