Questions and Answers regarding Private Fund Registration and Recordation (IX)

 2018-06-28  45


· Area of Law: Securities

· Level of Authority: Industry Regulations

· Date issued:05-13-2016

· Effective Date:05-13-2016

· Status: Effective

· Issuing Authority: Associations

 

Questions and Answers regarding Private Fund Registration and Recordation (IX)
(Asset Management Association of China, May 13, 2016)
Question: In accordance with the Announcement on Several Matters concerning Further Regulating the Registration of Private Fund Managers issued by the Asset Management Association of China (“AMAC”) on February 5, 2016, what conditions should the senior executives of private fund managers meet in order to pass the fund business qualification determination by the Qualification Determination Committee? What materials need to be submitted?
Answer: A senior executive of a private equity fund manager (including a venture capital fund manager) who meets any of the following conditions may apply to the Qualification Determination Committee of the AMAC for qualification to engage in the fund business:
(1) He or she has engaged in private equity investment (including venture capital investment) for six years or more, and participated in and successfully exited at least two projects.
(2) He or she once served as a senior executive of a listed company or a large or medium-sized enterprise with paid-in capital of not less than one billion yuan, and has worked for 12 years or more.
(3) He or she is a senior executive who has engaged in economic and social administration for 12 years or more.
(4) He or she has engaged in teaching and research in economics, finance, or any other relevant specialty in an institution of higher learning or research institution for 12 years or more, and has obtained a professional title of professor or researcher.
Where any of the above conditions is met, the institution where he or she works or the individual should submit the following materials to the AMAC:
(1) Written application for determination of qualification of the individual.
(2) Registration form for basic personal information.
(3) Relevant supporting materials:
(a) If the aforesaid condition (1) is met, proof of successful exit from the projects and two recommendation letters signed by prominent figures in the industry should be submitted, and the titles and contact information of the recommenders should be stated in the recommendation letters.
(b) If the aforesaid condition (2) is met, the relevant proof on the enterprise and individual and two recommendation letters signed by prominent figures in the industry should be submitted, and the titles and contact information of the recommenders should be stated in the recommendation letters.
(c) If the aforesaid condition (3) is met, a certificate of service issued by the relevant organization department should be submitted.
(d) If the aforesaid condition (4) is met, the relevant qualification certificates and two recommendation letters signed by prominent figures in the industry should be submitted, and the titles and contact information of the recommenders should be stated in the recommendation letters.
The composition and working mechanism of the Qualification Determination Committee: The Qualification Determination Committee consists of council members (excluding non-member directors) and supervisors of the AMAC and members of relevant professional committees on private funds. Seven among the aforesaid committee members are randomly selected to form a determination panel to vote on an applicant for qualification determination by a simple majority. The voters and recommenders who participate in qualification determination and the results of qualification determination are published through the practitioner information publication platform on the website of the AMAC.
The aforesaid materials related to applications for qualification recognition should be sent to the mailbox of the AMAC dedicated to the management of private fund senior executives in an electronic form at smrygl@amac.org.cn.
Question: What conditions should the senior executives of private fund managers meet so that they only need to pass the Subject Test 1: Fund Laws and Regulations, Professional Ethics and Business Rules before applying for qualification to engage in the fund business? What materials need to be submitted?
Answer: A senior executive of a private fund manager who meets any of the following conditions and passes the Subject Test 1 may apply for determination of fund business qualification:
(1) He or she has engaged in business relating to asset management in the most recent three years, with the annual average of assets under management of ten million yuan or more.
(2) He or she has passed financial-related qualification tests such as the tests for qualification to engaged in the securities business (excluding subject tests of “Securities Investment Funds” and “Securities Offering and Underwriting”), the futures business, or the banking business or qualification for chartered financial analyst (CFA), has obtained the qualification for CPA, legal profession, or asset appraiser, or serves as a director, supervisor, or senior executive of a listed company, among others.
Where any of the aforesaid conditions is met, the institution where he or she works or the individual should submit to the AMAC a certificate on the size of assets under management in the most recent three years issued by the fund custodian (custody department) or fund service provider or the relevant qualification certificate or proof.
The aforesaid materials related to applications for qualification determination should be submitted in an electronic form through the port of the private fund registration and recordation system for uploading qualification determination documents.
Question: What subject tests for qualification to engage in the securities business should the senior executives of private equity fund managers (including venture capital fund managers) pass so that they may be qualified to engage in the fund business?
Answer: (1) In accordance with the Notice of Matters on the Examination for Qualification to Engage in the Fund Business (No. 112 [2015], AMAC), one that passed the subject test of Securities Investment Funds organized by the Securities Association of China before December 2015 needs to also pass the Subject Test 1: Fund Laws and Regulations, Professional Ethics and Business Rules of the AMAC before applying to the AMAC for registering his or her qualification to engage in the fund business.
(2) One that passed the tests of Basic Knowledge on Securities Markets and Securities Investment Funds organized by the Securities Association of China or the tests of Basic Knowledge on Securities Markets and Securities Offering and Underwriting before December 2015 may directly apply to the AMAC for registering his or her qualification to engage in the fund business.
Question: How does a senior executive of a private fund manager not meeting the qualification determination conditions in the aforesaid three answers obtain qualification to engage in the fund business?
Answer: One may take the Subject Test 1: Fund Laws and Regulations, Professional Ethics and Business Rules, Subject Test 2: Basic Knowledge on Securities Investment Funds, and Subject Test 3: Basic Knowledge on Equity Investment Funds (to be provided in September 2016) uniformly organized by the AMAC. An examinee who passes the Subject Tests 1 and 2 or passes the Subject Tests 1 and 3 may apply for registering his or her qualification to engage in the fund business.
Annex: Registration Form for Basic Personal Information for the Fund Business Qualification Determination of Private Fund Senior Executives