The four departments issued guiding opinions on regulating the asset management business of financial institutions
People's Daily News, Beijing, April 27 (Li Haixia, Wang Zihou) In order to standardize the asset management business of financial institutions, unify the regulatory standards of similar asset management products, effectively prevent and control financial risks, and better serve the real economy, with the consent of the State Council, the People's Bank of China, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission and the State Administration of Foreign Exchange recently jointly issued the "Guiding Opinions on Regulating the Asset Management Business of Financial Institutions" (Yinfa  No. 106, hereinafter referred to as the "Opinions").
In accordance with the overall requirements of the Party Central Committee and the State Council to "serve the real economy, prevent and control financial risks, and deepen financial reform", and in accordance with the decision-making and deployment of "resolutely fighting the battle of preventing and resolving major risks", the "Opinions" adhere to the bottom-line thinking of strictly controlling risks, adhere to the fundamental goal of serving the real economy, adhere to the regulatory concept of combining macro-prudential management and micro-prudential supervision, adhere to the targeted problem-orientation, adhere to the basic idea of active, steady and prudent promotion, and comprehensively cover and uniformly regulate the asset management business of all types of financial institutions , implement fair market access and supervision, eliminate regulatory arbitrage space to the greatest extent, and effectively protect the legitimate rights and interests of financial consumers.
The Opinions unify regulatory standards according to product types, classify asset management products from the two dimensions of fundraising method and investment nature, and unify requirements such as investment scope, leverage constraint and information disclosure. Adhere to the principle of product and investor matching, strengthen investor suitability management, and strengthen the diligence and information disclosure obligations of financial institutions. It is clarified that asset management business shall not promise to guarantee principal and income, breaking the rigid payment. Strict investment requirements for non-standardized debt assets, prohibition of capital pooling, and prevention of shadow banking risks and liquidity risks. Classification unifies liability and hierarchical leverage requirements, eliminates multi-layer nesting, and inhibits channel business. Strengthen regulatory coordination, strengthen macro-prudential management and functional supervision.
The Opinions adhere to the combination of risk prevention and orderly regulation, reasonably set a transition period, give financial institutions time for orderly rectification and transformation of asset management business, and ensure the stable operation of the financial market.
In the next step, all relevant departments will conscientiously implement the requirements of the Opinions in accordance with their responsibilities and division of labor. Financial institutions shall, in accordance with the relevant provisions of the Opinions, carry out asset management business in accordance with laws and regulations.
In recent years, China's asset management business has developed rapidly, and has played an active role in meeting the investment and financing needs of residents and enterprises and improving the social financing structure, but there are also problems such as irregular business development, multi-layer nesting, rigid payment, circumvention of financial supervision and macro-control. In accordance with the decision-making and deployment of the Party Central Committee and the State Council, in order to standardize the asset management business of financial institutions, unify the regulatory standards for similar asset management products, effectively prevent and control financial risks, guide the flow of social funds to the real economy, and better support economic restructuring, transformation and upgrading, with the consent of the State Council, the following opinions are hereby put forward:
1. Regulating the asset management business of financial institutions mainly follows the following principles:
(1) Adhere to the bottom-line thinking of strictly controlling risks. Put the prevention and resolution of asset management business risks in a more important position, reduce stock risks, and strictly prevent incremental risks.
(2) Adhere to the fundamental goal of serving the real economy. It not only gives full play to the function of asset management business, effectively serves the investment and financing needs of the real economy, but also strictly regulates and guides to avoid self-circulation of funds within the financial system, prevent products from being too complex, and aggravate the transmission of risks across industries, markets and regions.
(3) Adhere to the regulatory concept of combining macro-prudential management with micro-prudential supervision, and combining institutional supervision with functional supervision. Achieve comprehensive and unified coverage of asset management business for all types of institutions, adopt effective regulatory measures, and strengthen the protection of financial consumers' rights and interests.
(4) Persist in being targeted and problem-oriented. Focus on the problems of multi-layer nesting, unclear leverage, serious arbitrage, and frequent speculation in asset management business, set unified standards and regulations, and at the same time adhere to the pursuit of benefits and avoid disadvantages of financial innovation, and divide into two, leaving room for development.
(5) Persist in active, prudent and prudent advancement. Correctly handle the relationship between reform, development and stability, adhere to the combination of risk prevention and orderly standardization, fully consider the market bearing capacity while making up our minds to deal with risks, reasonably set the transition period, grasp the order, rhythm and intensity of work, strengthen market communication, and effectively guide market expectations.
2. Asset management business refers to financial services in which banks, trusts, securities, funds, futures, insurance asset management institutions, financial asset investment companies and other financial institutions are entrusted by investors to invest and manage the entrusted investors' assets. The financial institution performs the obligations of good faith, diligence and due diligence for the interests of the principal and collects corresponding management fees, and the principal bears the investment risk and obtains returns. Financial institutions may agree in advance with the principal to collect reasonable performance remuneration in the contract, and the performance remuneration shall be included in the management fee, which shall correspond to the products one by one and settle one by one, and different products shall not be used in tandem with each other.
Asset management business is the off-balance sheet business of financial institutions, and financial institutions shall not undertake to guarantee principal and income when carrying out asset management business. In the event of payment difficulties, financial institutions shall not advance funds in any form to make payments. Financial institutions are not allowed to carry out asset management business within the balance sheet.
These Opinions shall apply to special laws and administrative regulations on private investment funds, and the relevant provisions of venture capital funds and government investment funds shall be formulated separately if not expressly provided for in the special laws and administrative regulations on private equity investment funds.
3. Asset management products include but are not limited to bank non-principal protected wealth management products in the form of RMB or foreign currency, fund trusts, asset management products issued by securities companies, subsidiaries of securities companies, fund management companies, fund management subsidiaries, futures companies, subsidiaries of futures companies, insurance asset management institutions, financial asset investment companies, etc. These Opinions do not apply to asset securitization business carried out in accordance with the rules promulgated by the financial management department and pension products issued in accordance with the rules promulgated by the human resources and social security department.
4. Asset management products are divided into public offering products and private placement products according to different fundraising methods. Public offering products are offered to the public to unspecified public. The criteria for determining public offerings shall be implemented in accordance with the Securities Law of the People's Republic of China. Private placement products are offered privately to accredited investors.
Asset management products are divided into fixed income products, equity products, commodity and financial derivatives products and hybrid products according to the nature of investment. The proportion of fixed income products invested in debt assets such as deposits and bonds is not less than 80%, the proportion of equity products invested in equity assets such as stocks and equity of unlisted enterprises is not less than 80%, the proportion of commodity and financial derivatives products invested in commodities and financial derivatives is not less than 80%, and the investment ratio of hybrid products in debt assets, equity assets, commodities and financial derivatives assets does not meet the standards of the first three types of products. If the aforementioned ratio limit is not caused by the subjective factors of the financial institution, the financial institution shall adjust to meet the requirements within 15 trading days when the assets with limited liquidity can be sold, transferred, or resumed trading.
When issuing asset management products, financial institutions shall clearly indicate the type of asset management products to investors in accordance with the above classification standards, and invest in accordance with the determined nature of the products. After the establishment of the product to the expiration date, the product type shall not be changed without authorization. The proportion range of investment in debt assets, equity assets and commodities and financial derivatives assets of hybrid products shall be determined and clearly indicated to investors at the time of issuance of the product, and shall not be changed without authorization after the establishment of the product and before the maturity date. The actual investment direction of the product shall not violate the contractual agreement, and if there is any change, except for high-risk types of products that invest in lower-risk assets beyond the proportional range, the written consent of the investor shall be obtained first, and laws and regulations such as registration and filing, as well as the procedures stipulated by the financial supervision and administration department.
5. Investors in asset management products are divided into two categories: unspecified public and qualified investors. Qualified investors refer to natural persons and legal persons or other organizations that have the corresponding risk identification ability and risk bearing ability, invest in a single asset management product with not less than a certain amount and meet the following conditions.
(1) Have more than 2 years of investment experience and meet one of the following conditions: household financial net assets are not less than 3 million yuan, family financial assets are not less than 5 million yuan, or their average annual income in the past three years is not less than 400,000 yuan.
(2) A legal entity with net assets of not less than 10 million yuan at the end of the last one year.
(3) Other circumstances in which the financial management department considers it a qualified investor.
Qualified investors invest in a single fixed income product with an amount of not less than RMB300,000, a single hybrid product with an amount of not less than RMB400,000, and a single equity product, a single commodity and financial derivatives product with an amount of not less than RMB1 million.
Investors are not allowed to use non-own funds raised by loans, bond issuance, etc. to invest in asset management products.
6. Financial institutions issuing and selling asset management products shall adhere to the business philosophy of "know the product" and "know the customer", strengthen investor suitability management, and sell asset management products to investors that are compatible with their risk identification ability and risk bearing ability. It is forbidden to defraud or mislead investors into purchasing asset management products that do not match their risk-taking capacity. Financial institutions shall not sell asset management products to investors whose risk identification ability and risk bearing capacity are lower than the risk level of the product by splitting the asset management products.
Financial institutions should strengthen investor education, continuously improve investors' financial knowledge and risk awareness, convey to investors the concept of "sellers are responsible, buyers are responsible", and break rigid payment.
7. Financial institutions carrying out asset management business shall have a management system and management system compatible with the development of asset management business, good corporate governance, and sound risk management, internal control and accountability mechanisms.
Financial institutions shall establish and complete qualification identification, training, assessment and evaluation and accountability systems for asset management business personnel, ensure that personnel engaged in asset management business have the necessary professional knowledge, industry experience and management capabilities, fully understand relevant laws, regulations, regulatory provisions, and legal relationships, transaction structures, main risks and risk management and control methods of asset management products, and comply with codes of conduct and professional ethical standards.
Practitioners of asset management business of financial institutions who violate relevant laws and regulations and the provisions of these Opinions shall be punished in accordance with the law up to and including the cancellation of their qualifications, and they shall be prohibited from engaging in asset management business in other types of financial institutions.
8. Financial institutions using entrusted funds for investment shall abide by prudent operation rules, formulate scientific and reasonable investment strategies and risk management systems, and effectively prevent and control risks.
Financial institutions shall perform the following administrator duties:
(1) Raising funds in accordance with law, and handling matters concerning the sale and registration of product shares.
(2) Handle product registration filing or registration formalities.
(3) Separately manage, keep separate accounts and invest in the entrusted assets of different products under management.
(4) Determine the income distribution plan in accordance with the provisions of the product contract, and distribute the income to investors in a timely manner.
(5) Conduct product accounting and prepare product financial accounting reports.
(6) Calculate and disclose the net value or investment income of the product in accordance with law, and determine the application and redemption price.
(7) Handling information disclosure matters related to entrusted property management business activities.
(8) Keeping records, account books, statements and other relevant materials of entrusted property management business activities.
(9) Exercising litigation rights or carrying out other legal acts on behalf of investors in the name of the manager.
(10) When redeeming the entrusted funds and proceeds, the financial institution shall ensure that the entrusted funds and proceeds are returned to the original account of the trustor, the account in the same name, or the beneficiary account stipulated in the contract.
(11) Other duties prescribed by the financial supervision and management departments.
Where a financial institution fails to earnestly perform its fiduciary management duties in accordance with the principles of good faith, diligence and due diligence, causing losses to investors, it shall bear compensation liability to investors in accordance with law.
9. Financial institutions selling asset management products issued by other financial institutions on behalf of them shall meet the qualification requirements stipulated by the financial regulatory authorities. Without the permission of the financial regulatory authorities, no non-financial institution or individual may act as an agent to sell asset management products.
Financial institutions shall establish a sales authorization management system for asset management products, clarify the entry standards and procedures of agent sales institutions, clearly define the rights and obligations of both parties, and clarify the methods of assuming responsibility and transferring relevant risks.
Financial institutions acting as agents for the sale of asset management products shall establish corresponding internal approval and risk control procedures, conduct due diligence on the credit status, operation and management capabilities, market investment capabilities, risk disposal capabilities, etc. of the issuing or management institution, require the issuing or management institution to provide detailed product introductions, relevant market analysis and risk-return measurement reports, conduct sufficient information verification and risk review, and ensure that the products sold by the agency comply with the provisions of these Opinions and bear corresponding responsibilities.
10. Publicly offered products mainly invest in standardized debt assets and stocks that are listed for trading, and shall not invest in the equity of unlisted enterprises unless otherwise provided by laws, regulations and financial management departments. Public offerings may invest in commodities and financial derivatives, but shall comply with laws and regulations and the relevant provisions of financial management authorities.
The investment scope of private placement products is stipulated in the contract, and it can invest in debt assets, listed or traded stocks, equity (including debt-to-equity swap) and usufructuary rights of unlisted enterprises and other assets that comply with laws and regulations, and strictly abide by the investor suitability management requirements. Encourage the full use of private equity products to support market-oriented and law-based debt-to-equity swaps.
11. Investment in asset management products shall comply with the following provisions:
(1) Standardized creditor's rights assets shall meet the following conditions at the same time:
1. Equally differentiated, tradable.
2. Adequate information disclosure.
3. Centralized registration and independent hosting.
4. Fair pricing and perfect liquidity mechanism.
5. Trading in the interbank market, stock exchange market and other trading markets established with the approval of the State Council.
The specific rules for the identification of standardized creditor's rights assets shall be formulated separately by the People's Bank of China in conjunction with the financial regulatory authorities.
Debt assets other than standardized debt assets are non-standardized debt assets. Where financial institutions issue asset management products to invest in non-standardized debt assets, they shall comply with the relevant regulatory standards such as limit management and liquidity management formulated by the financial regulatory departments. Where the financial regulatory departments have not formulated relevant regulatory standards, the People's Bank of China shall urge the formulation and implementation of regulatory standards in accordance with the requirements of these Opinions.
Financial institutions shall not directly invest funds from asset management products in the credit assets of commercial banks. The restrictions on the investment of credit assets of commercial banks subject to the right to (receive) usufruct shall be formulated separately by the financial management departments.
(2) Asset management products shall not directly or indirectly invest in industries and fields prohibited by laws, regulations and national policies from making debt or equity investments.
(3) Encourage financial institutions to raise funds through the issuance of asset management products to invest in fields that meet the requirements of national strategies and industrial policies and the requirements of national supply-side structural reform policies on the premise of legal compliance and commercial sustainability. Encourage financial institutions to raise funds through the issuance of asset management products to support economic structural transformation, support market-oriented and law-based debt-to-equity swaps, and reduce the leverage ratio of enterprises.
(4) Cross-border asset management products and businesses shall be implemented with reference to these Opinions, and shall comply with the relevant provisions on cross-border RMB and foreign exchange management.
12. Financial institutions shall actively, truthfully, accurately, completely and promptly disclose to investors the information raised by asset management products, the direction of capital investment, the level of leverage, the distribution of returns, custody arrangements, investment account information and major investment risks. Where national laws and regulations provide otherwise, those provisions shall prevail.
For publicly offered products, financial institutions shall establish a strict information disclosure management system, clarifying the requirements for periodic reports, interim reports, announcements of major matters, investment risk disclosure, as well as specific content and format. Disclose the net value or investment income of the product on the official website of the institution or through a means convenient for investors, and disclose other important information on a regular basis: open-end products are disclosed according to the frequency of openness, and closed-end products are disclosed at least once a week.
For private placement products, the method, content and frequency of information disclosure shall be stipulated in the product contract, but financial institutions shall disclose the net value of the product and other important information to investors at least quarterly.
For fixed income products, financial institutions shall fully disclose and remind investors of the investment risks of the products in a conspicuous manner, including but not limited to market risks such as interest rate and exchange rate changes faced by the products invested in bonds, as well as fluctuations in bond prices, financing customers, project names, remaining financing periods, maturity income distribution, transaction structure, risk status, etc. of each non-standardized debt asset invested in the product.
For equity products, financial institutions shall fully disclose and remind investors of the investment risks of the products in a conspicuous manner, including the risks faced by the products in investing in stocks and the fluctuation of stock prices.
For commodities and financial derivatives products, financial institutions should fully disclose to investors the underlying assets, position risks, control measures and changes in the fair value of derivatives in a conspicuous manner.
For hybrid products, financial institutions should clearly disclose the investment asset portfolio of the product to investors in a conspicuous manner, and fully disclose and remind the corresponding investment risks according to the investment ratio of fixed income, equity, commodity and financial derivatives assets.
13. Financial institutions whose main business does not include asset management business shall establish asset management subsidiaries with independent legal person status to carry out asset management business, strengthen the risk isolation of legal persons, and may establish special asset management business operation departments to carry out business if they do not meet the conditions for the time being.
Financial institutions shall not provide any direct or indirect, explicit or implicit guarantees, repurchases, or other commitments to bear risks on behalf of non-standardized debt assets or equity assets invested in asset management products.
Financial institutions carrying out asset management business shall ensure that asset management business is separated from other businesses, asset management products are separated from the financial products they sell, asset management products are separated from each other, and asset management business operations are separated from other business operations.
14. After the issuance of these Opinions, the assets of asset management products issued by financial institutions shall be independently held in custody by a third-party institution with custodian qualifications, except as otherwise provided by laws and administrative regulations.
During the transition period, commercial banks with securities investment fund custodian business qualifications may custodify their wealth management products, but shall open separate custodian accounts for each product to ensure asset isolation. After the transition period, a commercial bank with securities investment fund custodian business qualifications shall establish a subsidiary with independent legal person status to carry out asset management business, and the commercial bank may custodian the asset management products issued by the subsidiary, but shall achieve substantial independent custody. Where the independent custody is in name only, the financial supervision and administration department shall correct and punish it.
15. Financial institutions shall ensure that the funds of each asset management product are separately managed, separately accounted for, and separately accounted for, and must not carry out or participate in capital pool business with the characteristics of rolling issuance, collective operation and separate pricing.
Financial institutions shall reasonably determine the term of the assets invested in asset management products, strengthen liquidity risk management for maturity mismatch, and financial regulatory departments shall formulate liquidity risk management regulations.
In order to reduce the risk of maturity mismatch, financial institutions should strengthen the duration management of asset management products, and the term of closed-end asset management products should not be less than 90 days. Where asset management products directly or indirectly invest in non-standardized debt assets, the termination date of the non-standardized debt assets shall not be later than the maturity date of the closed-end asset management product or the latest open day of the open-ended asset management product.
Where asset management products directly or indirectly invest in the equity of unlisted enterprises and their usufruct rights, they shall be closed-end asset management products, and the exit arrangements for equity and their usufruct rights shall be clarified. The exit date of the equity of an unlisted enterprise and its beneficial rights shall not be later than the maturity date of the closed-end asset management product.
Financial institutions shall not violate the regulations of the financial regulatory authorities by setting up multiple asset management products for a single financing project, disguised as breaking through the limit on the number of investors or other regulatory requirements. Where the same financial institution issues multiple asset management products to invest in the same asset, in order to prevent the risk of the same asset from spreading to multiple asset management products, the total scale of funds invested by multiple asset management products in the asset shall not exceed 30 billion yuan. If this limit is exceeded, approval by the relevant financial supervisory authority is required.
16. Financial institutions shall ensure that the risk level of the assets invested in each asset management product matches the investor's risk-bearing capacity, so that the composition of the assets invested in each product is clear and the risks are identifiable.
Financial institutions should control the concentration of assets invested in asset management products:
(1) The market value of a single public asset management product investing in a single securities or a single securities investment fund shall not exceed 10% of the net assets of the asset management product.
(2) The market value of all publicly offered asset management products issued by the same financial institution to invest in a single securities or a single securities investment fund shall not exceed 30% of the market value of the securities or securities investment fund. Among them, all open-ended public asset management products of the same financial institution shall not invest in the shares issued by a single listed company shall not exceed 15% of the tradable shares of the listed company.
(3) The investment of all asset management products of the same financial institution in the shares issued by a single listed company shall not exceed 30% of the tradable shares of the listed company.
Except as otherwise provided by the financial supervision and administration authorities.
If the aforementioned ratio limit is not caused by the subjective factors of the financial institution, the financial institution shall adjust to meet the relevant requirements within 10 trading days of the sale, transferability or resumption of trading of assets with restricted liquidity.
17. Financial institutions shall make a risk reserve at 10% of the income from the management fee of asset management products, or measure operational risk capital or corresponding risk capital reserves in accordance with regulations. When the risk reserve balance reaches 1% of the product balance, it can no longer be withdrawn. Risk reserves are mainly used to compensate for losses caused to asset management products, assets or investors due to violations of laws and regulations, violations of asset management product agreements, operational errors or technical failures of financial institutions. Financial institutions shall regularly report the use of risk reserves to the financial management department.
18. Financial institutions shall implement net value management of asset management products, the generation of net value shall comply with the provisions of enterprise accounting standards, timely reflect the benefits and risks of underlying financial assets, be accounted for by custodian institutions and provide reports on a regular basis, and external audit institutions shall conduct audit confirmation, and the audited financial institutions shall disclose the audit results and submit them to the financial management department at the same time.
Financial assets adhere to the principle of fair value measurement and encourage the use of market value measurement. Amortized cost can be measured in accordance with accounting standards for business enterprises if one of the following conditions is met:
(1) The asset management product is a closed-end product, and the invested financial assets are held for the purpose of receiving contract cash flows and are held for maturity.
(2) The asset management product is a closed-end product, and the invested financial assets do not have an active trading market for the time being, or there is no quotation in the active market, and the fair value cannot be reliably measured using valuation techniques.
Financial institutions measuring the net value of financial assets at amortized cost shall adopt appropriate risk control measures to assess the fairness of the net value of financial assets. When the net value of financial assets can no longer be truly and fairly reflected by amortized cost measurement, the custodian institution should urge the financial institution to adjust the accounting and valuation methods. The deviation between the weighted average price of financial assets measured at amortized cost in the previous period of financial assets and the value of financial assets at the time of actual redemption of asset management products shall not reach 5% or more, and if the number of products that deviate by 5% or more exceeds 5% of the total number of products issued, financial institutions shall not issue asset management products that measure financial assets at amortized cost.
19. If determined by the financial management department, the following acts are deemed to be rigid payment:
(1) The issuer or manager of an asset management product violates the principle of true and fair determination of net value by guaranteeing principal and income on the product.
(2) Adopt rolling issuance and other methods to transfer the principal, income and risk of asset management products between different investors, so as to realize the guaranteed principal and guaranteed returns of the products.
(3) When the asset management product cannot be paid on time or it is difficult to redeem it, the financial institution that issued or manages the product raises funds to reimburse on its own or entrusts other institutions to repay on its behalf.
(4) Other circumstances determined by the financial management departments.
Where rigid payment behavior is found, the following two types of institutions are to be punished:
(1) Where a deposit-taking financial institution has a rigid payment, it is determined that it is using asset management products with the essential characteristics of deposits to carry out regulatory arbitrage, and the banking and insurance regulatory authority under the State Council and the People's Bank of China shall regulate the deposit business in accordance with the deposit business, pay the deposit reserve and deposit insurance premiums in full, and impose administrative penalties.
(2) Where rigid payment occurs in a non-depository licensed financial institution, it is determined to be operating in violation of regulations, and the financial regulatory department and People's Bank of China shall correct and punish it in accordance with law.
Where any unit or individual discovers that a financial institution has rigid payment behavior, it may report it to the financial management department, and if it is verified to be true and the content of the report is not mastered by the relevant departments, an appropriate reward shall be given.
When an external audit institution conducts an audit of a financial institution, if it discovers that the financial institution has rigid payment behavior, it shall promptly report it to the financial management department. Where external audit institutions fail to exercise due diligence during audits, pursue corresponding responsibilities in accordance with law or give administrative punishments in accordance with laws and regulations, and include relevant information in the national credit information sharing platform, establishing joint disciplinary mechanisms.
20. Asset management products shall set an upper limit on the liability ratio (total assets/net assets), and a uniform upper limit on the liability ratio shall be applied to similar products. The total assets of each open-ended public offering product shall not exceed 140% of the net assets of the product, and the total assets of each closed-end public offering product and each private offering product shall not exceed 200% of the net assets of the product. When calculating the total assets of a single product, the total assets of the invested asset management products should be calculated together in accordance with the penetration principle.
Financial institutions shall not use the share of asset management products entrusted to them for pledge financing and increase leverage.
21. Public offerings and open-ended private offerings shall not be graded for shares.
The total assets of a tiered private placement product shall not exceed 140% of the net assets of the product. Graded private placement products should set a grading ratio according to the risk degree of the invested assets (priority share/inferior share, intermediate share included in priority share). The grading ratio of fixed income products shall not exceed 3:1, the grading ratio of equity products shall not exceed 1:1, and the grading ratio of commodity and financial derivatives products and hybrid products shall not exceed 2:1. Financial institutions that issue graded asset management products shall independently manage the asset management products and shall not delegate them to inferior investors.
Tiered asset management products shall not directly or indirectly provide principal and income protection arrangements to priority share subscribers.
"Graded asset management products" as used in this article refers to products in which there are shares of more than one level to provide certain risk compensation for other levels of shares, and the distribution of benefits is not calculated according to the proportion of shares, and is otherwise agreed in the asset management contract.
22. Financial institutions shall not provide channel services for the asset management products of other financial institutions to circumvent regulatory requirements such as investment scope and leverage constraints.
Asset management products can be reinvested in a layer of asset management products, but the asset management products invested in cannot be reinvested in asset management products other than publicly offered securities investment funds.
Where a financial institution invests its asset management products in asset management products issued by other institutions, thereby entrusting the funds of its asset management products to other institutions for investment, the entrusted institution shall be an institution subject to the supervision of the financial regulatory authorities with professional investment capabilities and qualifications. The trustee of public asset management products shall be a financial institution, and the trustee of private asset management products may be a private fund manager. The entrusted institution shall earnestly perform its active management duties, and shall not transfer entrustment or reinvest in asset management products other than publicly offered securities investment funds. The entrusted institution shall carry out due diligence on the entrusted institution, implement management under the list system, and clearly stipulate the access standards and procedures, responsibilities and obligations, duration management, conflict of interest prevention mechanism, information disclosure obligation, and withdrawal mechanism of the entrusted institution. The entrusting institution shall not be exempted from its own responsibilities by entrusting other institutions to invest.
Financial institutions may engage professionally qualified institutions subject to the supervision of the financial supervision and administration authorities as investment advisers. Investment advisors provide investment advice and guide the operation of the entrusted institution.
The financial regulatory departments and relevant state departments shall implement equal access and fair treatment for all types of financial institutions carrying out asset management business. Asset management products shall enjoy equal status in account opening, property rights registration, legal proceedings, etc. Where the financial regulatory departments really need to take restrictive measures on asset management products issued by financial institutions in other industries based on risk prevention and control considerations, they shall fully solicit the opinions of the relevant departments and reach a consensus.
23. The use of artificial intelligence technology to carry out investment advisory business shall obtain investment advisory qualifications, and non-financial institutions shall not use intelligent investment advisers to operate beyond the scope or carry out asset management business in disguise.
Financial institutions using AI technology to carry out asset management business shall strictly abide by the general provisions of these Opinions on investor suitability, investment scope, information disclosure, risk isolation, etc., and must not use AI business to exaggerate and publicize asset management products or mislead investors. Financial institutions shall report the main parameters of the AI model and the main logic of asset allocation to the financial regulatory authority, set up a separate intelligent management account for investors, fully remind the inherent defects and use risks of the AI algorithm, clarify the transaction process, strengthen the management of traces, and strictly monitor the trading position, risk limit, transaction type, price authority, etc. of the intelligent management account. Where a financial institution causes losses to investors due to violations of laws and regulations or improper management, it shall bear liability for damages in accordance with law.
Financial institutions should develop corresponding artificial intelligence algorithms or programmatic trading according to the investment strategies of different products, avoid the pro-cyclicality of investment behavior aggravated by algorithm homogenization, and formulate response plans for the market volatility risks that may arise therefrom. Where AI algorithm model defects or system abnormalities such as algorithm homogenization, programming design errors, and insufficient data utilization depth lead to herd effect and affect the stable operation of the financial market, financial institutions shall promptly take manual intervention to force adjustments or terminate AI businesses.
24. Financial institutions shall not use the funds of asset management products to engage in improper transactions, benefit transmission, insider trading and market manipulation with related parties, including but not limited to investing in false projects of related parties, jointly acquiring listed companies with related parties, injecting capital into the institution, etc.
Where a financial institution's asset management products invest in securities issued or underwritten by the institution, custodian institution, its controlling shareholders, actual controllers, or companies with other major interests, or engage in other major related party transactions, it shall establish and complete internal approval mechanisms and assessment mechanisms, and fully disclose information to investors.
25. Establish a unified reporting system for asset management products. People's Bank of China is responsible for coordinating the data coding and comprehensive statistics of asset management products, formulating a statistical system for asset management products in conjunction with the financial supervision and management department, establishing an asset management product information system, standardizing and unifying product standards, information classification, codes, and data formats, and statistically basic information, fundraising information, asset liability information and termination information on a product-by-product basis. People's Bank of China and financial supervision and administration departments strengthen the sharing of statistical information on asset management products. Financial institutions shall submit information on asset management products containing debt investment to the basic financial credit information database.
Within 5 working days after the establishment of each asset management product, the financial institution shall submit the basic information of the product and the initial fundraising information to the People's Bank of China and financial regulatory authorities at the same time; Submit the fundraising information and asset and liability information before the 10th of each month, and submit the termination information within 5 working days after the termination of the product.
Central Treasury Bond Depository and Clearing Co., Ltd., China Securities Depository and Clearing Co., Ltd., Interbank Market Clearing House Co., Ltd., Shanghai Bills Exchange Co., Ltd., Shanghai Gold Exchange, Shanghai Insurance Exchange Co., Ltd., and China Insurance Asset Registration and Trading System Co., Ltd. shall simultaneously submit to the People's Bank of China and financial regulatory authorities the information on the financial instruments registered and managed by asset management products before the 10th of each month.
Before the official operation of the asset management product information system, the People's Bank of China work with the financial supervision and administration department to formulate a unified transition period data submission template according to the statistical system; Each financial regulatory department shall provide data to People's Bank of China in accordance with the data submission template for asset management products issued by financial institutions in the industry before the 10th of each month, and promptly communicate major risk information and matters across industries and markets.
People's Bank of China supervise and inspect the statistical work of asset management products of financial institutions. The specific system for asset management product statistics shall be formulated separately by the People's Bank of China in conjunction with relevant departments.
26. The People's Bank of China shall be responsible for the implementation of macro-prudential management of asset management business, and formulate standard regulations for asset management business in conjunction with the financial supervision and management department. The financial regulatory authorities shall implement market access and routine supervision of asset management business, strengthen investor protection, and formulate and issue implementation rules in their respective regulatory fields in conjunction with People's Bank of China in accordance with these Opinions.
After the formal implementation of these Opinions, People's Bank of China establish a working mechanism in conjunction with the financial regulatory authorities to continuously monitor the development and risk status of asset management business, regularly evaluate the effectiveness of standard regulations and market impact, revise and improve them in a timely manner, and promote the sustainable and healthy development of the asset management industry.
27. The supervision of asset management business shall follow the following principles:
(1) Combining institutional supervision with functional supervision, implementing functional supervision according to product type rather than institutional type, and applying the same regulatory standards to the same type of asset management products, reducing regulatory vacuum and arbitrage.
(2) Implement penetrating supervision, for multi-layer nested asset management products, identify the final investors of the product upwards and the underlying assets of the products downward (except for publicly offered securities investment funds).
(3) Strengthen macro-prudential management, establish a macro-prudential policy framework for asset management business, improve policy tools, and strengthen monitoring, evaluation and regulation from macro, counter-cyclical and cross-market perspectives.
(4) Realize real-time supervision, carry out comprehensive and dynamic supervision of asset management products, such as issuance, sales, investment, and payment, and establish a comprehensive statistical system.
28. The financial regulatory departments shall, in accordance with the provisions of these Opinions, formulate and improve punishment rules for violations, impose penalties in accordance with law, and ensure that the punishment standards are consistent. Where asset management business violates the requirements of macro-prudential management, the People's Bank of China shall impose penalties in accordance with laws and regulations.
29. After the implementation of these Opinions, the financial regulatory authorities shall study and formulate supporting rules within the framework of these Opinions, and the supporting detailed rules shall be connected with each other to avoid new regulatory arbitrage and unfair competition. Set up a transition period in accordance with the principle of "dividing the old from the new" to ensure a smooth transition. The transition period is from the date of issuance of this opinion to the end of 2020, and appropriate regulatory incentives will be given to institutions that complete rectification ahead of schedule. During the transition period, financial institutions issuing new products shall comply with the provisions of these Opinions; In order to continue the unmatured assets invested in the existing products and maintain the necessary liquidity and market stability, financial institutions may issue old products for docking, but they should strictly control them within the overall scale of the existing products, and reduce them in an orderly manner to prevent the cliff effect at the end of the transition period. Financial institutions shall formulate a rectification plan for asset management business during the transition period, clarify the time schedule, and submit it to the relevant financial regulatory department for approval and supervision of implementation, and report the People's Bank of China at the same time. After the end of the transition period, the asset management products of financial institutions shall be fully regulated in accordance with these Opinions (except for cases where the factor company has not yet been established and cannot meet the requirements of third-party independent custody), and financial institutions shall not issue or maintain asset management products that violate the provisions of this Opinion.
30. As a financial business, asset management business belongs to the franchise industry and must be included in financial supervision. Non-financial institutions shall not issue or sell asset management products, except as otherwise provided by the State.
Where non-financial institutions violate the above provisions, in order to expand the scope of investors and lower the investment threshold, use Internet platforms and other acts such as public publicity, split and sell investment targets with investment thresholds, overemphasize credit enhancement measures to conceal product risks, and establish secondary trading markets for products, and carry out standardized clean-up in accordance with national regulations, which constitute illegal fundraising, illegal absorption of public deposits, illegal issuance of securities, etc., legal responsibility shall be pursued in accordance with law. Where non-financial institutions carry out asset management business in violation of laws and regulations, they shall be punished in accordance with law; At the same time, those who promise or carry out rigid payment shall be given a heavier punishment according to law.
31. These Opinions shall take effect on the date of promulgation.
"Financial regulatory authorities" as used in these Opinions refers to People's Bank of China, the banking and insurance regulatory authority under the State Council, the securities regulatory authority under the State Council and the State Administration of Foreign Exchange. "Offering" refers to the issuance of an invitation to subscribe to investors in asset management products through public or non-public means to raise funds. "Sales" refers to the activities of promoting asset management products to investors, handling product application and redemption. "Agency sales" refers to the activities of accepting the entrustment of the cooperative institution to publicize, promote and sell the asset management products issued by the cooperative institution to investors in the channel of the cooperative institution in accordance with the law.