Viewpoint | New Law Express-The State Council officially issued the Regulations on the Supervision and Administration of Private Investment Funds

(I) on the investment scope of private equity funds.

(II) negative list on investment scope

(III) about government investment projects

Chapter I General Provisions

Article 1 In order to regulate the business activities of private equity investment funds (hereinafter referred to as private equity funds), protect the legitimate rights and interests of investors and related parties, and promote the standardized and healthy development of the private equity fund industry, in accordance with the Securities Investment Fund Law of the the People's Republic of China (hereinafter referred to as "Securities Investment Fund Law"), "the People's Republic of China Trust Law", "the People's Republic of China Company Law", "the People's Republic of China Partnership Law" and other laws, formulate these regulations.

Article 2 Within the territory of the the People's Republic of China, these Regulations shall apply to the raising of funds in a non-public manner, the establishment of investment funds or the establishment of companies or partnerships in accordance with the law for the purpose of carrying out investment activities, which shall be managed by private fund managers or general partners and shall be carried out for the benefit of investors.

Article 3 The State shall encourage the standardized and healthy development of the private equity fund industry, and give full play to the functions of serving the real economy and promoting scientific and technological innovation.

Private equity fund business activities shall follow the principles of voluntariness, fairness and good faith, protect the legitimate rights and interests of investors, shall not violate laws, administrative regulations and national policies, shall not violate public order and good customs, and shall not harm the interests of the state, the public interest and the legitimate rights and interests of others.

Private equity fund managers manage and use private equity fund property, private equity fund custodians trust private equity fund property, and private equity fund service institutions engaged in private equity fund service business shall abide by laws and administrative regulations, perform their duties with due diligence, and perform the obligations of honesty and trustworthiness, prudence and diligence.

Private equity fund practitioners shall abide by laws and administrative regulations, abide by professional ethics and code of conduct, and receive compliance and professional competence training in accordance with regulations.

Article 4 The property of a private equity fund is independent of the inherent property of the private equity fund manager and the private equity fund custodian. The debts of the private equity property are borne by the private equity property itself, unless otherwise provided by law. Investors shall distribute the proceeds and bear the risks in accordance with the fund contract, the articles of association and the partnership agreement (hereinafter collectively referred to as the fund contract).

Article 5 The supervision and management of the business activities of private equity funds shall implement the line, principles, policies, decisions and arrangements of the Party and the State. The securities regulatory authority under the State Council shall supervise and manage the business activities of private equity funds in accordance with the provisions of the law and these Regulations, and its dispatched offices shall perform their duties in accordance with the authorization. Where the State has other provisions on the supervision and management of private equity funds initiated or participated in by using a certain proportion of government funds, such provisions shall prevail.

Article 6 The securities regulatory agency under the State Council shall implement differentiated supervision and management of private equity fund managers based on their business types, asset management scale, continuous compliance, risk control, and ability to serve investors, and conduct differentiated supervision and management of private equity funds such as venture capital investment and securities investment.

Chapter II Private Fund Managers and Private Fund Trustees

Article 7 The manager of a private equity fund shall be a company or partnership established in accordance with the law. If the assets of a private equity fund established in the form of a partnership are managed by a general partner, the general partner shall apply the provisions of these Regulations on private equity fund managers.

The shareholders and partners of the private equity fund manager, as well as the controlling shareholders and actual controllers of the shareholders and partners, who hold or actually control other private equity fund managers, shall comply with the provisions of the securities regulatory authority under the State Council.

Article 8 Under any of the following circumstances, a person shall not serve as a private equity fund manager, and shall not become the controlling shareholder, actual controller or general partner of the private equity fund manager:

(I) the circumstances specified in Article 9 of these Regulations;

(II) the private equity fund manager whose registration has been canceled due to the circumstances listed in item 3 of the first paragraph of Article 14 of these regulations, it has not been more than 3 years since the date of cancellation of registration, or is the controlling shareholder, actual controller or general partner of the private equity fund manager;

There is a conflict of interest between the (III)'s business and the management of private equity funds;

(IV) have serious bad credit records that have not been repaired.

Article 9 Under any of the following circumstances, a private equity fund manager shall not serve as a director, supervisor, senior manager, executive partner or appointed representative:

(I) are sentenced to criminal punishment for corruption and bribery, dereliction of duty, infringement of property, or for disrupting the order of the socialist market economy;

The (II) has been given an administrative penalty by the financial management department for major violations of laws and regulations in the past three years;

(III) directors, supervisors, factory directors, senior managers, executive partners or representatives who are personally responsible for the bankruptcy liquidation of the company or enterprise in which they work due to poor management or the revocation of the business license due to violation of the law, it has not been more than 5 years since the date of the termination of the bankruptcy liquidation or the revocation of the business license of the company or enterprise;

The amount of debt incurred by the (IV) is relatively large, which is not paid off at maturity or is included in the list of persons subject to enforcement in breach of faith;

(V) the employees of fund managers, fund custodians, securities and futures trading venues, securities companies, securities registration and settlement institutions, futures companies and other institutions and state functionaries who have been dismissed for illegal acts;

(VI) lawyers, certified public accountants, practitioners of asset appraisal institutions, certification institutions, and investment consulting practitioners whose practicing certificates have been revoked or disqualified due to illegal acts, it has not been more than 5 years since the date of revocation or disqualification;

The (VII) has served as the legal representative, executive partner or appointed representative, or responsible senior manager of the private equity fund manager whose registration has been canceled due to the circumstances listed in Item 3 of the first paragraph of Article 14 of these regulations. It has not been more than 3 years since the date of cancellation of registration of the private equity fund manager.

Article 10 A private equity fund manager shall submit the following materials to the institution entrusted by the securities regulatory authority under the State Council (hereinafter referred to as the registration and filing institution) in accordance with the law, and perform the registration procedures:

(I) unified social credit code;

(II) the articles of association or partnership agreement;

Basic information (III) shareholders, actual controllers, directors, supervisors, senior managers, general partners, executive partners or appointed representatives, and information on shareholders, actual controllers, and relevant beneficial owners of partners;

(IV) a letter of credit commitment to ensure that the submitted materials are true, accurate, complete and comply with the supervision and management regulations;

(V) other materials as prescribed by the securities regulatory authority under the State Council.

If the controlling shareholder, actual controller, general partner, executive partner or appointed representative of the private equity fund manager changes in major matters, it shall perform the change registration procedures with the registration and filing agency in accordance with the regulations.

The registration and filing institution shall publicize the relevant information of the private equity fund manager that has been registered. Without registration, no unit or individual may use the words "fund" or "fund management" or similar names for investment activities, but laws, administrative regulations and the state shall be used. Except as otherwise provided.

Article 11 A private equity fund manager shall perform the following duties:

(I) raise funds in accordance with the law and handle the filing of private equity funds;

The (II) manages, accounts for and invests in the assets of the different private equity funds under its management;

(III) manage and invest private equity funds in accordance with the fund contract and establish an effective risk control system;

The (IV) determines the income distribution plan of the private equity fund in accordance with the fund contract and distributes the income to the investors;

The (V) provides investors with information related to private equity fund management business activities in accordance with the fund contract;

(VI) keep records, books, statements and other relevant materials of the property management business activities of private equity funds;

(VII) other duties as prescribed by the securities regulatory authority under the State Council and agreed upon in the fund contract.

Where an investment fund is established by raising funds in a non-public manner, the private equity fund manager shall also exercise litigation rights or perform other legal acts in its own name for the property interests of the private equity fund.

Article 12 The shareholders, actual controllers and partners of a private equity fund manager shall not commit the following acts:

(I) make false capital contributions, withdraw capital contributions, entrust others or accept capital contributions entrusted by others

The (II) interferes in the business activities of the private equity fund manager without the legal procedures such as the shareholders' meeting or the resolution of the board of directors;

(III) require private equity fund managers to use private equity fund property for their own or other interests, to the detriment of the interests of investors;

Other acts prohibited by (IV) laws, administrative regulations and the provisions of the securities regulatory authority under the State Council.

Article 13 A private equity fund manager shall continuously meet the following requirements:

The (I) is in good financial condition and has working capital commensurate with the type of business and the size of assets under management;

The legal representative of the (II), the executive partner or the appointed representative, or the senior manager in charge of investment management shall, in accordance with the provisions of the securities regulatory authority under the State Council, hold a certain proportion of the equity or property shares of the private equity fund manager, except as otherwise provided by the State;

(III) other requirements prescribed by the securities regulatory authority under the State Council.

Article 14 Where a private equity fund manager has one of the following circumstances, the registration and filing institution shall promptly cancel the registration of the private equity fund manager and make it public:

(I) apply for cancellation of registration on their own;

the (II) is dissolved, revoked or declared bankrupt according to law;

(III) are investigated for legal responsibility for major violations such as illegal fund-raising and illegal business operations;

The first private equity fund is not filed within 12 months from the date of (IV) registration;

After all the private equity funds managed by the (V) are liquidated, no new private equity funds have been filed within 12 months from the date of liquidation;

(VI) other circumstances as prescribed by the securities regulatory authority under the State Council.

Before the registration institution cancels the registration of the private equity fund manager, it shall notify the private equity fund manager to liquidate the private equity fund property or transfer the private equity fund management responsibilities to other registered private equity fund managers in accordance with the law.

Article 15 Unless otherwise agreed in the fund contract, the property of a private equity fund shall be held in trust by the trustee of the private equity fund. If the property of a private equity fund is not held in custody, the institutional measures and dispute resolution mechanisms to ensure the safety of the property of the private equity fund shall be clarified.

Article 16 Where the property of a private equity fund is held in custody, the custodian of the private equity fund shall perform its duties in accordance with the law. The private fund custodian shall establish a separation mechanism between the custody business and other business in accordance with the law to ensure the independence and safety of the private fund property.

Chapter III Fund Raising and Investment Operation

Article 17 Private equity fund managers shall raise funds by themselves and shall not entrust others to raise funds, except as otherwise provided by the securities regulatory authority under the State Council.

Article 18 A private equity fund shall be raised or transferred from qualified investors, and the cumulative number of investors in a single private equity fund shall not exceed the number prescribed by law. Private equity fund managers shall not take the establishment of multiple private equity funds for a single financing project, etc., to break the legal limit on the number of people, and shall not take the private equity fund shares or income rights to split and transfer, etc., to lower the standard of qualified investors. The term "qualified investor" as mentioned in the preceding paragraph refers to the units and individuals who have reached the prescribed asset scale or income level, and have the corresponding risk identification ability and risk bearing ability, and the subscription amount is not less than the prescribed limit. The specific standards for qualified investors shall be prescribed by the securities regulatory authority under the State Council.

Article 19 The private equity fund manager shall fully disclose the investment risks to the investors and match the private equity fund products of different risk levels according to the risk identification ability and risk bearing ability of the investors.

Article 20 Private equity funds shall not be raised or transferred to units and individuals other than qualified investors; they shall not be raised or transferred to investors who are held on behalf of others; they shall not be promoted to unspecified objects through mass media such as newspapers, radio, television, and the Internet, telephone, text messages, Instant messaging tools, e-mails, leaflets, or lectures, reports, analysis meetings, etc; no promotion shall be made in a false, one-sided or exaggerated manner; no promotion shall be made in the name of the custodian of the private equity fund; no investor shall be promised that the principal of the investment will not be lost or that the minimum return will be promised.

Article 21 Where a private equity fund manager uses the property of a private equity fund to invest, the name of the private equity fund shall be indicated when opening an account in the name of the private equity fund manager, including the register of shareholders of the invested enterprise or holding other private equity fund property.

Article 22 A private equity fund manager shall, within 20 working days from the date of completion of private equity fund raising, submit the following materials to the registration and filing institution for filing:

(I) fund contracts;

(II) custody agreements or institutional measures to ensure the safety of private equity funds;

(III) private equity fund property certification documents;

(IV) basic information about the investor, the amount of the subscription, the number of shares held in the Fund and information about its beneficial owners;

(V) other materials as prescribed by the securities regulatory authority under the State Council. Private equity funds shall have the scale of paid-in funds to ensure basic investment capacity and anti-risk ability. The registration and filing institution shall carry out classified publicity according to the scale of funds raised by private equity funds, and shall report to the securities regulatory authority under the State Council if the total amount of funds raised or the number of investors reaches the prescribed standards.

Article 23 The securities regulatory authority under the State Council shall establish and improve a monitoring mechanism for privately offered funds, and conduct centralized monitoring of the share holdings of privately offered funds and their investors. The specific measures shall be prescribed by the securities regulatory authority under the State Council.

Article 24 The investment of private equity fund property includes the purchase and sale of shares of a joint stock limited company, equity of a limited liability company, bonds, fund shares, other securities and their derivatives, and other investment targets that meet the requirements of the securities regulatory authority under the State Council. Private equity fund property shall not be used to operate or disguise the operation of capital lending, loans and other business. Private equity fund managers shall not increase the government's hidden debt in disguise by requiring local people's governments to promise to buy back the principal.

Article 25 The investment levels of private equity funds shall comply with the provisions of the financial management department of the State Council. However, private equity funds that meet the conditions prescribed by the securities regulatory authority under the State Council and invest the main fund property in other private equity funds are not included in the investment hierarchy. The investment levels of venture capital funds and private equity funds as stipulated in the second paragraph of Article 5 of these Regulations shall be prescribed by the relevant departments of the State Council.

Article 26 Private equity fund managers shall follow the principle of professional management and employ senior managers with corresponding experience to be responsible for investment management, risk control, compliance and other work. Private equity fund managers shall follow the principle of giving priority to the interests of investors, establish management systems for investment declaration, registration, examination and disposal of employees, and prevent the transfer of interests and conflicts of interest.

Article 27 The manager of a private equity fund shall not entrust the investment management duties to others. Where a private equity fund manager entrusts other institutions to provide securities investment advice services for private equity funds, the entrusted institution shall be the fund investment advisory institution stipulated in the Securities Investment Fund Law.

Article 28 The manager of a private equity fund shall establish and improve the management system for connected transactions, and shall not conduct improper transactions or transfer of benefits between the property of the private equity fund and related parties, and shall not conceal it through multi-layer nesting or other means. Where a private equity fund manager uses private equity fund property to conduct transactions with himself, investors, other private equity funds under his management, other private equity fund managers under the control of his actual controller, or other entities with which he has a major interest, it shall perform the decision-making procedures stipulated in the fund contract and provide relevant information to investors and private equity fund custodians in a timely manner.

Article 29 The manager of a private equity fund shall, in accordance with the provisions, employ an accounting firm to audit the property of the private equity fund, provide the investors with the audit results, and submit them to the registration and filing institution.

Article 30 Private fund managers, private fund custodians and their practitioners shall not commit the following acts:

The (I) confuse its inherent property or the property of others with the property of the private equity fund;

(II) use the property or position of private equity funds to seek benefits for people other than investors;

(III) embezzlement and misappropriation of private equity assets;

(IV) divulging undisclosed information obtained for the convenience of his position, and using the information to engage in or express or imply that others are engaged in relevant securities and futures trading activities;

Other acts prohibited by (V) laws, administrative regulations and the provisions of the securities regulatory authority under the State Council.

Article 31 In the process of fund raising and investment operation, a private equity fund manager shall provide information to investors in accordance with the provisions of the securities regulatory authority under the State Council and the fund contract. Where the property of a private equity fund is held in custody, the private equity fund manager shall, in accordance with the provisions of the securities regulatory authority under the State Council and the custody agreement, provide the private equity fund custodian with basic information of the investor, proof of change of ownership of the investment target and other information in a timely manner.

Article 32 The information provided and submitted by private fund managers, private fund custodians and their practitioners shall be true, accurate and complete, and shall not commit the following acts:

(I) false records, misleading statements or material omissions;

(II) forecasts of investment performance;

The (III) promises to the investor that the principal of the investment will not be lost or promises a minimum return;

Other acts prohibited by (IV) laws, administrative regulations and the provisions of the securities regulatory authority under the State Council.

Article 33 Private fund managers, private fund custodians and private fund service institutions shall, in accordance with the provisions of the securities regulatory authority under the State Council, submit information on the investment and operation of private funds to the registration and filing institutions. The registration and filing institution shall, according to different types of private equity funds, make provisions on the content and frequency of information submitted, summarize and analyze the situation of the private equity fund industry, and submit relevant information on the private equity fund industry to the securities regulatory authority under the State Council. The registration and filing institution shall strengthen the risk early warning, and if it finds that there may be major risks, it shall take timely measures and report to the securities regulatory authority under the State Council. The registration and filing institution shall keep confidential the information specified in the first paragraph of this article, and shall not provide it to the outside world unless otherwise provided by laws and administrative regulations.

Article 34 If the private equity fund cannot operate or terminate normally due to the inability of the private equity fund manager to perform its duties normally or the occurrence of major risks, other professional institutions specified in the fund contract or relevant regulations shall exercise the replacement of the private equity fund manager, Modify or terminate the fund contract early, organize the liquidation of private equity funds, etc.

Chapter IV Special Provisions on Venture Capital Funds

Article 35 The term "venture capital fund" as mentioned in these Regulations refers to a private equity fund that meets the following conditions:

The scope of (I) investment is limited to unlisted enterprises, except for the untransferred part of the shares held by the fund after the listing of the invested enterprise and the part of the allotment;

The name of the (II) fund contains the words "venture capital fund" or the words "engaging in venture capital activities" in the business scope of the company or partnership;

(III) fund contracts reflect venture capital strategy;

(IV) do not use leveraged financing, except as otherwise provided by the State;

The minimum duration of the (V) fund complies with the relevant provisions of the State;

(VI) other conditions stipulated by the state.

Article 36 The State shall give policy support to venture capital funds, encourage and guide them to invest in growth and innovative start-up enterprises, and encourage long-term funds to invest in venture capital funds. The development and reform department of the State Council is responsible for organizing the formulation of policies and measures to promote the development of venture capital funds. The securities regulatory body of the State Council and the development and reform department of the State Council shall establish and improve the sharing mechanism of information and support policies, and strengthen the coordination of the supervision and management policies and development policies of venture capital funds. The registration and filing institution shall promptly submit information related to the venture capital fund to the securities regulatory authority under the State Council and the development and reform department under the State Council. The investment of venture capital funds that enjoy the support of state policies shall comply with the relevant provisions of the state.

Article 37 The securities regulatory authority under the State Council shall implement differentiated supervision and management of venture capital funds that are different from other private equity funds:

(I) optimize the business environment of venture capital funds and simplify the registration procedures;

(II) differentiated supervision and management of venture capital funds that raise funds legally, invest in compliance, and operate in good faith in terms of fund raising, investment operations, risk monitoring, and on-site inspections, and reduce the frequency of inspections;

The (III) provides convenience for venture capital funds mainly engaged in long-term investment, value investment, and transformation of major scientific and technological achievements in terms of investment exit.

Article 38 The registration and filing institution shall implement differentiated self-discipline management of venture capital funds different from other private equity funds in terms of registration and filing, change of matters, etc.

Chapter V Supervision and Administration

Article 39 The securities regulatory authority under the State Council shall supervise and manage the business activities of privately offered funds and perform the following duties in accordance with the law:

To (I) and formulate rules and regulations concerning the supervision and administration of the business activities of private equity funds;

(II) supervise and manage private equity fund managers, private equity fund custodians and other institutions engaged in private equity fund business activities, and investigate and deal with illegal acts;

The (III) shall guide, inspect and supervise the registration and filing and self-discipline management activities; and (IV) other duties prescribed by laws and administrative regulations.

Article 40 The securities regulatory authority under the State Council shall have the right to take the following measures to perform its duties in accordance with the law:

(I) conduct on-site inspections of private equity fund managers, private equity fund custodians, and private equity fund service agencies, and require them to submit relevant business information;

(II) entering the place where the suspected illegal act occurred to investigate and collect evidence;

(III) interrogate the parties and the units and individuals related to the incident under investigation and require them to explain the matters related to the incident under investigation;

(IV) consult and copy the property rights registration, communication records and other materials related to the incident under investigation;

(V) access to and copy the securities trading records, registration and transfer records, financial and accounting information and other relevant documents and information of the parties and units and individuals related to the incident under investigation; documents and information that may be transferred, concealed or destroyed may be sealed;

(VI) inquire about the party concerned and the account information related to the event under investigation according to law;

(VII) other measures prescribed by laws and administrative regulations. In order to prevent the risks of private equity funds and maintain market order, the securities regulatory authority under the State Council may take measures such as ordering corrections, regulatory talks, and issuing warning letters.

Article 41 When the securities regulatory authority under the State Council conducts supervision, inspection or investigation in accordance with the law, there shall be no less than two supervisory, inspection or investigation personnel, and shall produce law enforcement certificates and supervision, inspection, investigation notices or other law enforcement documents. The business secrets and personal privacy learned in the course of supervision, inspection or investigation shall be kept confidential according to law. The units and individuals under inspection or investigation shall cooperate with the supervision, inspection or investigation conducted by the securities regulatory authority under the State Council in accordance with the law, truthfully provide relevant documents and materials, and shall not refuse, hinder or conceal them.

Article 42 If the securities regulatory agency under the State Council finds that a private equity fund manager violates laws and regulations, or its internal governance structure and risk control management do not meet the requirements, it shall order it to make corrections within a time limit; if it fails to make corrections within the time limit, or its behavior seriously endangers the private equity fund manager If the sound operation of the company harms the legitimate rights and interests of investors, the securities regulatory agency under the State Council may take the following measures depending on the circumstances:

(I) order the suspension of part or all of its operations;

(II) order to replace the directors, supervisors, senior managers, executive partners or appoint representatives, or restrict their rights;

(III) order the liable shareholders to transfer their shares and the liable partners to transfer their shares of property, and restrict the liable shareholders or partners from exercising their rights;

The (IV) shall order the private equity fund manager to hire or appoint a third party to audit the property of the private equity fund, and the relevant expenses shall be borne by the private equity fund manager. Where a private equity fund manager operates illegally or has major risks, seriously endangering market order or harming the interests of investors, the securities regulatory authority under the State Council may, in addition to taking the measures specified in the preceding paragraph, take over the private equity fund manager by appointing other institutions, notify the registration and filing agency to cancel registration and other measures.

Article 43 The securities regulatory authority under the State Council shall record the integrity information of private equity fund managers, private equity fund custodians, private equity fund service institutions and their employees in the capital market integrity database and the national credit information sharing platform.

The securities regulatory authority under the State Council shall, in conjunction with the relevant departments of the State Council, establish and improve a joint disciplinary system for the managers of private equity funds and the relevant responsible subjects in accordance with the law. The securities regulatory authority under the State Council, together with other financial management departments and other relevant departments of the State Council and the people's governments of provinces, autonomous regions and municipalities directly under the Central Government, shall establish a cooperative mechanism for information sharing, statistical data reporting and risk disposal in the supervision and management of private equity funds. In the process of handling risks, the relevant local people's governments shall take effective measures to maintain social stability.

Chapter VI Legal Liability

Article 44 Anyone who fails to perform the registration procedures in accordance with Article 10 of these regulations and uses the words "fund" or "fund management" or similar names for investment activities shall be ordered to make corrections, the illegal income shall be confiscated, and the illegal income shall be more than 1 time and 5 times The following is a fine; if there is no illegal income or the illegal income is less than 1 million yuan, a fine of 100000 yuan to 1 million yuan shall be imposed. The person in charge and other persons directly responsible shall be given a warning and imposed a fine of not less than 30000 yuan but not more than 300000 yuan.

Article 45: If the shareholders, actual controllers, or partners of a private equity fund manager violate the provisions of Article 12 of these regulations, they shall be ordered to make corrections, give a warning or notify a notice of criticism, confiscate the illegal income, and impose a penalty of 1 to 5 times the illegal income The following is a fine; if there is no illegal income or the illegal income is less than 1 million yuan, a fine of 100000 yuan to 1 million yuan shall be imposed. The directly responsible person in charge and other directly responsible persons shall be given a warning or informed criticism, and a fine of not less than 30000 yuan but not more than 300000 yuan shall be imposed.

Article 46 If a private equity fund manager violates the provisions of Article 13 of these regulations, it shall be ordered to make corrections; if it refuses to make corrections, it shall be given a warning or notified of criticism, and a fine of 100000 yuan up to 1 million yuan shall be imposed, and it shall be ordered to stop private equity fund business activities And make an announcement. The directly responsible person in charge and other directly responsible persons shall be given a warning or informed criticism, and a fine of not less than 30000 yuan but not more than 300000 yuan shall be imposed.

Article 47 In violation of the provisions of the second paragraph of Article 16 of these regulations, if a private equity fund custodian fails to establish a business isolation mechanism, it shall be ordered to make corrections, given a warning or notified criticism, and imposed a fine of 50000 yuan up to 500000 yuan. The directly responsible person in charge and other directly responsible persons shall be given a warning or informed criticism, and a fine of not less than 30000 yuan but not more than 300000 yuan shall be imposed.

Article 48 whoever violates the provisions of articles 17, 18 and 20 of these regulations on the management and raising methods of qualified investors of private equity funds, the illegal income shall be confiscated and a fine of not less than 1 time but not more than 5 times the illegal income shall be imposed; if there is no illegal income or the illegal income is less than 1 million yuan, a fine of not less than 100000 yuan but not more than 1 million yuan shall also be imposed. The person in charge and other persons directly responsible shall be given a warning and imposed a fine of not less than 30000 yuan but not more than 300000 yuan.

Article 49 whoever, in violation of the provisions of Article 19 of these regulations, fails to fully disclose the investment risks to investors and misleads them into investing in private equity fund products that do not match their risk identification ability and risk bearing ability, shall be given a warning or informed criticism, and shall be fined not less than 100000 yuan but not more than 300000 yuan; if the circumstances are serious, they shall be ordered to stop the business activities of private equity funds and make an announcement. The directly responsible person in charge and other directly responsible persons shall be given a warning or informed criticism, and a fine of not less than 30000 yuan but not more than 100000 yuan shall be imposed.

Article 50 in violation of the provisions of the first paragraph of Article 22 of these regulations, if the private equity fund manager fails to file the private equity fund raised, it shall be fined not less than 100000 yuan but not more than 300000 yuan. The person in charge and other persons directly responsible shall be given a warning and imposed a fine of not less than 30000 yuan but not more than 100000 yuan.

Article 51 whoever, in violation of the provisions of paragraph 2 of Article 24 of these regulations, uses the property of private equity funds for the operation or disguised operation of capital lending, loans and other businesses, or requires the local people's government to promise to buy back the principal, shall be ordered to make corrections, give a warning or circulate a notice of criticism, confiscate the illegal income and impose a fine of not less than 100000 yuan but not more than 1 million yuan. The directly responsible person in charge and other directly responsible persons shall be given a warning or informed criticism, and a fine of not less than 30000 yuan but not more than 300000 yuan shall be imposed.

Article 52 in violation of the provisions of Article 26 of these regulations, private equity fund managers fail to employ senior managers with corresponding experience to be responsible for investment management, risk control, compliance, etc., or fail to establish management systems such as investment declaration, registration, examination and disposal of employees, shall be ordered to make corrections, given a warning or informed criticism, and imposed a fine of not less than 100000 yuan but not more than 1 million yuan. The directly responsible person in charge and other directly responsible persons shall be given a warning or informed criticism, and a fine of not less than 30000 yuan but not more than 300000 yuan shall be imposed.

Article 53 If, in violation of the provisions of Article 27 of these regulations, a private equity fund manager entrusts others to perform investment management duties, or entrusts an institution that does not comply with the provisions of the Securities Investment Fund Law to provide securities investment advice services, it shall be ordered to make corrections, given a warning or a notice of criticism, confiscate the illegal income and impose a fine of not less than 100000 yuan but not more than 1 million yuan. The directly responsible person in charge and other directly responsible persons shall be given a warning or informed criticism, and a fine of not less than 30000 yuan but not more than 300000 yuan shall be imposed.

Article 54 If a private equity fund manager engages in related party transactions in violation of the provisions of Article 28 of these regulations, it shall be ordered to make corrections, be given a warning or informed criticism, the illegal income shall be confiscated, and a fine of not less than 100000 yuan but not more than 1 million yuan shall be imposed. The directly responsible person in charge and other directly responsible persons shall be given a warning or informed criticism, and a fine of not less than 30000 yuan but not more than 300000 yuan shall be imposed.

Article 55: Private equity fund managers, private equity fund custodians and their employees who commit one of the acts listed in Article 30 of these regulations shall be ordered to make corrections, give warnings or notify criticisms, confiscate illegal gains, and impose illegal gains 1 time A fine of not less than 5 times; if there is no illegal income or the illegal income is less than 1 million yuan, a fine of not less than 100000 yuan but not more than 1 million yuan shall be imposed. The directly responsible person in charge and other directly responsible persons shall be given a warning or informed criticism, and a fine of not less than 30000 yuan but not more than 300000 yuan shall be imposed.

Article 56 If a private equity fund manager, private equity fund custodian and their employees fail to provide or submit relevant information in accordance with the provisions of these regulations, or commit one of the acts listed in Article 32 of these regulations, they shall be ordered to make corrections, given a warning or informed criticism, confiscate the illegal income and impose a fine of not less than 100000 yuan but not more than 1 million yuan. The directly responsible person in charge and other directly responsible persons shall be given a warning or informed criticism, and a fine of not less than 30000 yuan but not more than 300000 yuan shall be imposed.

Article 57 If a private equity fund service institution and its employees violate laws and administrative regulations and fail to perform their duties and perform their duties diligently, they shall be ordered to make corrections, be given a warning or notified of criticism, and impose a fine of 100000 yuan up to 300000 yuan; if the circumstances are serious, Order it to stop the private equity fund service business. The directly responsible person in charge and other directly responsible persons shall be given a warning or informed criticism, and a fine of not less than 30000 yuan but not more than 100000 yuan shall be imposed.

Article 58 If a private equity fund manager, private equity fund custodian, private equity fund service institution and its employees violate these regulations or the relevant provisions of the securities regulatory authority under the State Council, and the circumstances are serious, the securities regulatory authority under the State Council may take measures to prohibit the relevant responsible personnel from entering the securities and futures market.

If the securities regulatory authority under the State Council and its staff refuse or obstruct the exercise of their powers of supervision, inspection and investigation in accordance with the law, the securities regulatory authority under the State Council shall order them to make corrections and impose a fine of not less than 100000 yuan but not more than 1 million yuan; if the act constitutes a violation of public security management, the public security organ shall impose public security management penalties in accordance with the law; if the case constitutes a crime, criminal responsibility shall be investigated according to law.

Article 59 Any staff member of the securities regulatory body under the State Council or the registration and filing body who neglects his duty, abuses his power, engages in malpractices for personal gain or takes advantage of his position to solicit or accept property from others shall be punished according to law; if the case constitutes a crime, he shall be investigated for criminal responsibility according to law.

Article 60 in case of violation of the provisions of these regulations and the provisions of the fund contract, he shall bear the civil liability for compensation, pay a fine or confiscate the illegal income according to law, and if his property is not enough to pay at the same time, he shall first bear the civil liability for compensation.

Article 61 Measures for the administration of foreign-invested private equity fund managers shall be formulated by the securities regulatory authority under the State Council in conjunction with the relevant departments under the State Council in accordance with the laws and administrative regulations on foreign investment and these Regulations.

Foreign institutions may not directly raise funds from domestic investors to establish private equity funds, except as otherwise provided by the State. Private equity fund managers conducting private equity fund business activities abroad shall comply with the relevant provisions of the State.

Article 62 These Regulations shall enter into force as of September 1, 2023.