How to Launch Foreign Private Investment Fund Manager Business in China Part I

Release time：2020-03-10 16:32

With the People’s Republic of China (the “China/PRC”) ’s Reform and Opening-up and the further expansion of the financial Opening-up thereof, more and more foreign investors wish to invest in China through the establishment of Foreign Private Equity Investment Fund Manager (the “FEM”) and/or the Foreign Private Securities Investment Fund Manager (the “FSM”, together with FEM, collectively referred as Foreign Private Investment Fund Manager, the “FPM”).

The Asset Management Association of the People’s Republic of China also issued a series of positive policies to show the confidence and signal of the Opening-up of China’s fund industry to the international investors, and such policies enable to pave the way with respect to the foreign private securities investment fund manager and provide more valuable fund products and border investment scope to the investors.

With the continuous Opening-up of China’s capital market, the foreign investors seize this opportunity and are accelerating their layout in China’s capital market. Until now, about twenty-two (22) well-known foreign institutions including, but not limited to, Fidelity(US), Neuberger Berman(US), UBS(CH), Fullerton(SG)，Allianz(DE), have launched and registered their foreign private securities investment fund manager in China and the asset scale to be managed is over six (6) billion RMB, which involving multiple types of products of stock, bond, quantitation and diversified assets.

In all, the practices and the legal risks to the foreign private equity investment fund and/or the foreign private securities investment fund manager are becoming more and more important and will hold lots of valuable business opportunities in the next decade. For the purpose of this tendency, therefore, this Memorandum intends to introduce to you the relevant legal risks associated with the establishment of FEM and FSM and other relevant issues that need to have your attention.

This Memorandum mainly includes three parts as follows:

A. Regulatory Framework of Foreign Private Investment Fund Manager;

B. Establishment of Foreign Private Investment Fund Manager; and

C. Registration of Foreign Private Investment Fund Manager.

随着中华人民共和国（以下简称“中国”）的改革开放的发展和金融领域对外开放进一步扩大，越来越多的外国投资者希望通过设立外商私募证券基金管理人来在中国进行投资。中国证券投资基金业协会也出具了一些列积极政策向国际投资者以展示对外开放的信心和信号，这些政策从经营上为外商私募管理人铺平了道路，并为投资者提供了更有价值的基金产品和更丰富的投资产品。

随着中国资本市场对外开放的不断推进，外资私募也正抓住机会加速布局。截至现在，包括富达利泰（美国）、路博迈（美国）、瑞银资产（瑞士）、富敦投资（新加坡）、安联寰通资产（德国）等22家知名外资机构在中基协备案成为私募基金管理人。资产管理规模接近60亿元人民币，产品涉及主动管理股票、债券、量化、多元资产等多个类型。

关于外商私募股权投资基金和外商私募证券投资基金实践操作和相关问题变得越来越重要，而且在未来十年将迎来无数的商业机会。为了把握本次趋势，因此，本备忘录旨在向您介绍与外商私募基金管理人的设立有关的法律风险和其他需要注意的相关问题。

该备忘录主要包括以下三个部分：

A. 外商私募基金管理人监管框架；

B. 外商私募基金管理人的设立；

C. 外商私募基金管理人的登记。

第一部分外商私募基金管理人监管框架

Part I Regulatory Framework of FPM

1. 旧有的监管框架

Previous Regulatory Framework

We understand in the past, the foreign direct investment in China will be mainly made by the set-up of equity joint venture or wholly-owned foreign enterprise, and following up the laws and regulations which include: (i) the Law of the People’s Republic of China on Sino-Foreign Equity Joint Ventures (the “Equity Joint Venture Law”)(中外合资经营企业法); (ii) the Law of the People’s Republic of China on Wholly Foreign-owned Enterprises (the “WFOE Law”)(外商独资企业法); and (iii) the Law of the People’s Republic of China on Sino-Foreign Cooperative Joint venture (the “Cooperative Joint Venture Law”)(中外合作经营企业法), together with Equity Joint Venture Law and WFOE Law collectively referred as the “Previous Foreign Law”) and the implementing regulations hereof and thereof.

以往外国投资者在中国的直接投资主要通过设立合资企业或独资外国企业等方式来进行，并遵循包括以下内容在内的法律法规：(i) 《中华人民共和国中外合资经营企业法》和《实施条例》；(ii) 《中华人民共和国外商独资企业法》和《实施条例》；(iii)《中华人民共和国中外合作经营企业法》和《实施条例》。以上三部法律被统称为“外资三法”或“三资企业法”。

2. 现行的监管框架

Current Regulatory Framework

However, for the purpose to encourage foreign investments and further protect the legitimate rights and interests thereof, the Foreign Investment Law of the People’s Republic of China (the “Foreign Investment Law”)(外商投资法) has been promulgated and issued by the State Council of China, and comes into effect on January 1, 2020.

但是，为鼓励外国投资并进一步保护其合法权益，中华人民共和国国务院颁布了《中华人民共和国外商投资法》（以下简称《外商投资法》），该法于2020年1月1日生效。

December 26, 2019, the State Council has further promulgated and issued other supporting laws and regulations concerning the Foreign Investment Law, which include:

(i) the Implementing Regulations of the Foreign Investment Law of the People’s Republic of China (the “Foreign Investment Regulations”)(外商投资法实施条例); and

(ii) the interpretation of the Supreme People’s Court on Several Issues Concerning the Application of the Foreign Investment Law of the People’s Republic of China (the “Foreign Investment Interpretation”, 最高人民法院关于适用《中华人民共和国外商投资法》若干问题的司法解释, together with Foreign Investment Law, Foreign Investment Regulations collectively referred as Foreign Investment Law).

2019年12月26日，国务院进一步颁布了有关《外商投资法》的配套法律法规，其中包括：(i)《中华人民共和国外商投资法实施条例》，（“《外商投资法实施条例》”）；(ii)《最高人民法院关于适用〈中华人民共和国外商投资法〉若干问题的司法解释》。以上两部法规与《中华人民共和国外商投资法》，统称为《外商投资法》。

In addition, there are two more policies that shall be included simultaneously as outlined below:

(i) the Special Administrative Measures of China for Admittance of Foreign Investment for 2019 (the “PRC Negative List”)(外商投资准入特别管理措施（负面清单）（2019版）); and

(ii) the Special Administrative Measures of China for Admittance of Foreign Investment for Free Trade Zone for 2019 (the “FTZ Negative List”, 自由贸易试验区外商投资准入特别管理措施（负面清单）（2019版）), together with the PRC Negative List, collectively referred as the “Negative List”).

此外，还应同时包含另外两个政策：(i)《外商投资准入特别管理措施（负面清单）（2019版）》，（“《中国负面清单》”）；和 (ii)《自由贸易试验区外商投资准入特别管理措施（负面清单）（2019版）》，（“《自贸区负面清单》”）。以上两个政策统称为《负面清单》。

The set-up of FSM shall also comply with the Law of the People’ s Republic of China on Securities Investment Funds (the “Securities Investment Funds Law”)(中华人民共和国证券投资基金法).

私募证券基金管理人的设立也须遵守《中华人民共和国证券投资基金法》。

3. 监管机构及其政策

Regulatory Bodies and Its Policies

The foremost regulatory body for foreign private fund is the Asset Management Association of China (the “AMAC”)(中国证券投资基金业协会) and AMAC has formulated and issued a series of regulation in connection with the set-up of FPM, including but not limited to (i) the Notice for Registration of Private Fund Manager (the “Notice”)(私募基金管理人登记须知); (ii) the Instruction for Securities Investment Fund Registration of Wholly Foreign-Owned Enterprise and Equity Joint Venture (the “Instruction”)(外商独资和合资私募证券投资基金管理人登记备案填报说明).

中国证券投资基金业协会是外商私募证券基金的主要监管机构（简称“中基协”）。中基协针对外商私募基金的设立制定并发布了一系列法规，包括但不限于：(i) 《私募基金管理人登记须知》，（“《登记须知》”）；(ii)《外商独资和合资私募证券投资基金管理人登记备案填报说明》，（“《填报说明》”）。

In addition, upon the outcomes of the eighth of China-U.S. Strategic and Economic Dialogue, a greatly encouraging policy has been achieved and accordingly AMAC has promulgated and issued the Answers to Questions on the Registration and Record-filing of Private funds (X) (the “FAQ10”)(私募基金登记备案相关问题解答（十）) to encourage eligible wholly foreign-owned enterprise and equity joint ventures may carry out the private securities fund management business in China.

有鉴于第八轮中美战略与经济对话的成果和此后一系列大程度支持政策的出台。中基协颁布了《私募基金登记备案相关问题解答（十）》，以此鼓励符合条件的外商独资企业和合资企业在中国开展私募基金管理业务。

Besides, other general regulations and policies issued by AMAC shall also be complied with when establishing an FPM, which include: (i) Interim Measures for the Supervision and Administration of Private Investment Funds (私募投资基金监督管理办法); and (ii) Announcement on Matters concerning Further Regulating Registration of Privately Offered Fund Managers (关于进一步规范私募基金管理人登记若干事项的公告).

此外，设立外商私募证券基金管理人时，还应遵守中基协颁布的其他一般法规和政策，包括：(i)《私募投资基金监督管理办法》；(ii)《关于进一步规范私募基金管理人登记若干事项的公告》。

To our understanding, the laws and regulations as mentioned above are the current laws and regulation in connection with the FPM and shall have your high attention at the first place. We are pleased to update you with any information thereof from time to time.

就我们目前所知，上述法律法规是与外商私募证券基金管理人相关的现行法律法规，应首先引起您的高度重视。我们会不断向您提供任何更新消息。

Next：How to Launch Foreign Private Investment Fund Manager Business in China Part II

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