Recently, the Asset Management Association of China ("AMAC") has formulated and issued the Standards for Compliance Management in Securities Investment Fund Management Companies (the "Standards"), effective from October 1, 2017.
The Standards make it clear that the compliance management system of a fund management company should be of independence. Any shareholder, director or senior executive of a fund management company should not violate the prescribed duties or procedures to directly give an instruction to or interfere with the work of the superintendent or the compliance management department. Further, the Standards require that any fund management company shall establish and uphold the compliance philosophy of making all employees observe compliance rules, letting senior executives take the lead to comply with compliance rules, deriving value from compliance, and serving compliance as the foundation for the company to survive. In a fund management company, compliance management personnel with at least three-year experience in securities, finance, law, accounting, information technology or other related areas, working in the compliance department, shall account for no less than 1.5 percent of total employees of such company, and there must be at least two employees for compliance management. Such personnel working in the compliance department do not include employees in the risk management position. Any fund management company that does not meet the requirements at present should ensure they will be satisfied by December 31, 2017.