The China Securities Regulatory Commission ("CSRC") has recently drawn up and issued the Administrative Measures for Private Asset Management Business of Securities and Futures Operators (Draft for Comment) and the Administrative Provions on the Operation of Private Asset Management Schemes of Securities and Futures Operators (Draft for Comment) (collectively as the "Draft for Comment") to seek public comments by August 19, 2018.
Major contents provided in the Draft for Comment are outlined as follows. The first is clearly stating that all types of private asset management business will be considered as the legal relation of trust. The second is systematically defining the business forms, product types and asset categories. The third is basically unifying the regulatory standards. The fourth is making further improvements, from the perspective of portfolio investment, mandatory custody, adequate disclosure and independent operation, to the institutional system for investment operation. The fifth is solidifying subject responsibilities of operators and calling for stricter internal management of compliance and risk control. The sixth is stepping up efforts to prevent and control major risks and providing rules in particular for liquidity risks and related-party transactions. And the seventh is intensifying frontline oversight and strengthening cooperation in oversight and self-discipline.