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Securities Investment Fund Law of the People's Republic of China

  • Categories:Propaganda
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  • Time of issue:2012-07-04 23:29
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(Summary description)Article 1 In order to regulate the activities of securities investment funds, protect the legitimate rights and interests of investors and related parties, and promote the healthy development of securities investment funds and the securities market, this law is formulated.

Securities Investment Fund Law of the People's Republic of China

(Summary description)Article 1 In order to regulate the activities of securities investment funds, protect the legitimate rights and interests of investors and related parties, and promote the healthy development of securities investment funds and the securities market, this law is formulated.

  • Categories:Propaganda
  • Author:
  • Origin:
  • Time of issue:2012-07-04 23:29
  • Views:
Information

Chapter One General Provisions

Chapter 2 Fund Manager

Chapter III Fund Custodian

Chapter 4 Fund Raising

Chapter 5 Fund Share Trading

Chapter VI Subscription and Redemption of Fund Shares

Chapter 7 Fund Operation and Information Disclosure

Chapter 8: Modification and termination of fund contracts and liquidation of fund assets

Chapter 9 Fund Unitholders' Rights and Their Exercise

Chapter 10 Supervision and Management

Chapter 11 Legal Liability

Chapter XII Supplementary Provisions

Chapter One General Provisions

Article 1 In order to regulate the activities of securities investment funds, protect the legitimate rights and interests of investors and related parties, and promote the healthy development of securities investment funds and the securities market, this law is formulated.

Article 2 Within the territory of the People’s Republic of China, securities investment funds (hereinafter referred to as “funds”) are raised through public offerings of fund shares, managed by the fund manager and under the custody of the fund custodian, for the benefit of the fund share holders, and securities investment in the form of asset portfolio Investment activities shall be governed by this law; otherwise, the provisions of the Trust Law of the People’s Republic of China, the Securities Law of the People’s Republic of China and other relevant laws and administrative regulations shall apply.

Article 3 The rights and obligations of fund managers, fund custodians and fund unit holders shall be stipulated in the fund contract in accordance with this Law.

Fund managers and fund custodians shall perform their fiduciary duties in accordance with this Law and the fund contract. Fund unit holders enjoy income and bear risks based on their fund shares.

Article 4 Engaging in securities investment fund activities shall follow the principles of voluntariness, fairness, honesty and credibility, and shall not harm national interests and social public interests.

Article 5 The fund contract shall stipulate the operation method of the fund. Fund operation methods can be closed, open or other methods.

A fund with a closed-end operation method (hereinafter referred to as a closed-end fund) means that the total amount of approved fund shares is fixed within the term of the fund contract, and the fund shares can be traded in a legally established securities exchange, but the fund share holders Funds that cannot be redeemed.

Funds with open-ended operation methods (hereinafter referred to as open-ended funds) refer to funds whose total fund shares are not fixed, and fund shares can be purchased or redeemed at the time and place agreed in the fund contract.

The methods for the sale, transaction, purchase and redemption of fund shares of funds that adopt other operating methods shall be separately formulated by the State Council.

Article 6 Fund property is independent of the inherent property of the fund manager and fund custodian. Fund managers and fund custodians shall not include fund property as their own property.

The property and income obtained by the fund manager and fund custodian as a result of the management, use of fund property or other circumstances shall be included in the fund property.

If a fund manager or fund custodian conducts liquidation due to legal dissolution, cancellation, or bankruptcy in accordance with the law, the fund property does not belong to its liquidation property.

Article 7 The creditor's rights of fund property shall not be offset with the debts of the inherent property of the fund manager or fund custodian; the creditor's rights and debts of different fund properties shall not be set off mutually.

Article 8 Debts not undertaken by the fund property itself shall not be enforced against the fund property.

Article 9 Fund managers and fund custodians shall perform their duties in the management and use of fund assets, and perform their duties of honesty, credibility, prudence and diligence.

Fund practitioners shall obtain the qualifications for fund practice in accordance with the law, abide by laws and administrative regulations, and abide by professional ethics and codes of conduct.

Article 10 Fund managers, fund custodians and fund share selling institutions may establish industry associations to strengthen industry self-discipline, coordinate industry relations, provide industry services, and promote industry development.

Article 11 The State Council’s securities regulatory agency shall supervise and manage the activities of securities investment funds in accordance with the law.

Chapter 2 Fund Manager

Article 12 The fund manager shall be a fund management company established according to law.

As a fund manager, it shall be approved by the securities regulatory agency of the State Council.

Article 13 The establishment of a fund management company shall meet the following conditions and be approved by the securities regulatory authority of the State Council:

(1) Have articles of association that comply with this Law and the Company Law of the People's Republic of China;

(2) The registered capital is not less than RMB 100 million and must be paid-in currency capital;

(3) Major shareholders have good business performance and good social reputation in securities business, securities investment consulting, trust asset management or other financial asset management, have no illegal records in the past three years, and have a registered capital of not less than 300 million yuan ;

(4) The number of personnel who have obtained the qualifications of fund practice reaches a quorum;

(5) Having business premises, safety precaution facilities and other facilities related to fund management business that meet the requirements;

(6) Have a sound internal audit and monitoring system and risk control system;

(7) Other conditions stipulated by laws, administrative regulations and by the State Council’s securities regulatory agency approved by the State Council.

Article 14 The securities regulatory authority under the State Council shall, within six months of accepting the application for the establishment of a fund management company, conduct an examination in accordance with the conditions and principles of prudential supervision stipulated in Article 13 of this Law, and make a decision on approval or disapproval. The applicant shall be notified; if the approval is not granted, the reasons shall be explained.

The establishment of branches, the amendment of the articles of association, or the modification of other major matters by a fund management company shall be reported to the securities regulatory authority of the State Council for approval. The securities regulatory authority under the State Council shall make a decision of approval or disapproval within 60 days from the date of acceptance of the application, and notify the applicant; if it is disapproved, it shall explain the reasons.

Article 15 The following persons shall not serve as fund practitioners of the fund manager:

(1) Those who have been sentenced to criminal punishment for corruption, bribery, dereliction of duty, property infringement, or undermining the order of the socialist market economy;

(2) Directors, supervisors, factory directors, managers and other senior management personnel who are personally responsible for the bankruptcy liquidation of the company or enterprise they are working for due to mismanagement or whose business license has been revoked due to violation of the law, since the completion of the bankruptcy liquidation of the company or enterprise or It has not been more than five years since the date of revoking the business license;

(3) Individuals have a relatively large amount of debts that have not been repaid upon maturity;

(4) Employees of fund managers, fund custodians, stock exchanges, securities companies, securities registration and clearing institutions, futures exchanges, futures brokerage companies and other institutions and staff of state agencies who have been expelled due to illegal acts;

(5) Lawyers, certified public accountants, practitioners of asset appraisal agencies, verification agencies, and investment consulting practitioners whose practice certificates have been revoked or disqualified due to illegal acts;

(6) Other personnel who are prohibited from engaging in fund business as required by laws and administrative regulations.

Article 16 Managers and other senior management personnel of fund managers shall be familiar with securities investment laws and administrative regulations, have fund business qualifications and have more than three years of work experience related to their positions.

Article 17 The selection or reappointment of fund managers and other senior management personnel shall be reported to the securities regulatory authority of the State Council for review in accordance with the terms of appointment prescribed by this Law and other relevant laws and administrative regulations.

Article 18 The directors, supervisors, managers and other practitioners of the fund manager shall not hold any position as the fund custodian or other fund manager, and shall not engage in securities trading and other activities that damage the fund property and the interests of fund unit holders .

Article 19 The fund manager shall perform the following duties:

(1) Raising funds in accordance with the law, handling or entrusting other institutions recognized by the Securities Regulatory Agency of the State Council to handle the sale, purchase, redemption and registration of fund shares on their behalf;

(2) Go through the fund filing procedures;

(3) Separately manage and keep separate accounts for different fund assets under management, and conduct securities investment;

(4) Determine the fund income distribution plan in accordance with the agreement of the fund contract, and distribute income to fund share holders in a timely manner;

(5) Perform fund accounting and prepare fund financial accounting reports;

(6) Preparation of mid-term and annual fund reports;

(7) Calculate and announce the net asset value of the fund, and determine the subscription and redemption prices of fund shares;

(8) Handle information disclosure matters related to fund property management business activities;

(9) Convene a meeting of fund share holders;

(10) Keep records, account books, statements and other related materials of fund property management business activities;

(11) In the name of the fund manager, exercise litigation rights or perform other legal actions on behalf of the interests of fund unit holders;

(12) Other duties as prescribed by the State Council's securities regulatory agency.

Article 20 The fund manager shall not have the following behaviors:

(1) Mixing its inherent property or the property of others with fund property to engage in securities investment;

(2) Treating different fund assets under its management unfairly;

(3) Using fund assets to seek benefits for third parties other than fund share holders;

(4) Commit to fund share holders in violation of the rules to promise gains or bear losses;

(5) Other acts prohibited by the securities regulatory agency of the State Council in accordance with the relevant provisions of laws and administrative regulations.

Article 21 The State Council’s securities regulatory agency shall, in accordance with its powers, order rectification of fund managers in one of the following circumstances, or disqualify fund management:

(1) Major violations of laws and regulations;

(2) No longer meets the conditions specified in Article 13 of this Law;

(3) Other circumstances stipulated by laws and administrative regulations.

Article 22 In any of the following circumstances, the fund manager’s duties shall terminate:

(1) Disqualified for fund management according to law;

(2) Dismissed by the fund share holders meeting;

(3) Dissolved, revoked or declared bankrupt in accordance with the law;

(4) Other circumstances stipulated in the fund contract.

Article 23 When the responsibilities of a fund manager are terminated, the fund unit holders' meeting shall appoint a new fund manager within six months; before the new fund manager is formed, the securities regulatory agency of the State Council shall designate a temporary fund manager.

When the fund manager's duties terminate, it shall properly keep the fund management business materials and go through the transfer procedures of the fund management business in a timely manner. The new fund manager or temporary fund manager shall accept it in time.

Article 24 When the duties of a fund manager terminate, an accounting firm shall be hired to audit the fund property in accordance with the regulations, and the audit results shall be announced and reported to the securities regulatory authority of the State Council for the record.

Chapter III Fund Custodian

Article 25 The fund custodian shall be a legally established commercial bank that has obtained fund custodian qualifications.

Article 26 To apply for the qualification of fund custody, the following conditions shall be met and approved by the securities regulatory agency of the State Council and the banking regulatory agency of the State Council:

(1) Net assets and capital adequacy ratio meet relevant regulations;

(2) There is a dedicated fund custody department;

(3) The number of full-time personnel who have obtained the qualifications of fund practice reaches a quorum;

(4) Have conditions for safe custody of fund property;

(5) Safe and efficient clearing and settlement system;

(6) It has business premises, security facilities and other facilities related to fund custody business that meet the requirements;

(7) Have a sound internal audit and monitoring system and risk control system;

(8) Other conditions stipulated by laws, administrative regulations, and approved by the State Council’s securities regulatory agency and the State Council’s banking regulatory agency.

Article 27 The provisions of Articles 15 and 18 of this Law shall apply to the practitioners of the fund custodian's specialized fund custodian department.

The provisions of Articles 16 and 17 of this Law shall apply to managers and other senior management personnel of the specialized fund custody department of the fund custodian.

Article 28 The fund custodian and the fund manager shall not be the same person, and may not contribute capital or hold shares to each other.

Article 29 The fund custodian shall perform the following duties:

(1) Safe custody of fund property;

(2) Opening fund accounts and securities accounts of fund property in accordance with regulations;

(3) Set up separate accounts for different fund assets under custody to ensure the integrity and independence of fund assets;

(4) Keep records, account books, statements and other related materials of fund custody business activities;

(5) In accordance with the agreement of the fund contract, and in accordance with the investment instructions of the fund manager, timely handle liquidation and delivery matters;

(6) Handle information disclosure matters related to fund custody business activities;

(7) Issue opinions on the fund's financial accounting report, interim and annual fund report;

(8) Reviewing and reviewing the fund's net asset value and fund share subscription and redemption prices calculated by the fund manager;

(9) Convene a meeting of fund unit holders in accordance with regulations;

(10) Supervise the investment operations of fund managers in accordance with regulations;

(11) Other duties as prescribed by the State Council's securities regulatory agency.

Article 30 If the fund custodian finds that the investment instruction of the fund manager violates laws, administrative regulations and other relevant provisions, or violates the provisions of the fund contract, it shall refuse to implement it, notify the fund manager immediately, and report to the securities regulatory authority of the State Council in a timely manner .

If the fund custodian finds that the investment instruction that the fund manager has taken effect in accordance with the transaction procedures violates laws, administrative regulations and other relevant provisions, or violates the fund contract, it shall immediately notify the fund manager and report to the securities regulatory authority of the State Council.

Article 31 The provisions of Article 20 of this Law shall apply to the fund custodian.

Article 32 The State Council’s securities regulatory agency and the State Council’s banking regulatory agency shall order fund custodians under one of the following circumstances to rectify or cancel fund custody qualifications based on their powers:

(1) Major violations of laws and regulations;

(2) No longer meets the conditions stipulated in Article 26 of this Law;

(3) Other circumstances stipulated by laws and administrative regulations.

Article 33 In any of the following circumstances, the fund custodian's duties shall terminate:

(1) The fund custody qualification was cancelled according to law;

(2) Dismissed by the fund share holders meeting;

(3) Dissolved, revoked or declared bankrupt in accordance with the law;

(4) Other circumstances stipulated in the fund contract.

Article 34 When the duties of the fund custodian are terminated, the fund unit holders' meeting shall appoint a new fund custodian within six months; before the new fund custodian is formed, the securities regulatory agency of the State Council shall designate a temporary fund custodian.

Upon termination of the duties of the fund custodian, the fund property and fund custody business materials shall be properly kept, and the transfer procedures of the fund property and fund custody business shall be handled in a timely manner. The new fund custodian or temporary fund custodian shall receive it in time.

Article 35 If the duties of a fund custodian terminate, it shall be

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