Recently, the General Office of the State Council issued the "Several Policies and Measures to Promote the High-quality Development of Venture Capital", proposing 17 specific measures around five aspects.
At the regular policy briefing of the State Council held on June 26, the relevant persons in charge of the National Development and Reform Commission, the State-owned Assets Supervision and Administration Commission of the State Council, the State Administration of Financial Supervision and Administration, and the China Securities Regulatory Commission introduced the relevant situation of "Several Policies and Measures to Promote the High-quality Development of Venture Capital" and answered questions from reporters. Let's take a look -
Quick Facts at the Launch
● Optimization of the whole chain of "fundraising, investment, management and withdrawal".
● Guide long-term funds such as insurance funds to invest in venture capital, and study increasing the upper limit of the concentration ratio of insurance funds investing in venture capital funds
● Focus on the key links of fund assessment, fault tolerance and exemption mechanism, performance evaluation system and other institutional mechanisms, and take the lead in cultivating state-owned assets and government investment funds into patient capital and play a leading and exemplary role
● Encourage central enterprises to use venture capital funds to invest early, small, long-term, and hard technology
● Carry out a pilot project for the in-kind distribution of shares by private equity venture capital funds
● For venture capital institutions that invest in new tracks such as originality, it is necessary to increase policy support
Key initiatives
Optimization of the whole chain of "fundraising, investment, management and withdrawal".
National Development and Reform Commission:
The "Policies and Measures" put forward the following policy measures around the whole chain and life cycle of venture capital "fundraising, investment, management and withdrawal".
●On the fund-raising side, we will guide long-term funds such as insurance funds to invest in venture capital, expand the pilot scope of direct equity investment by financial asset investment companies, mobilize qualified social capital to do "patient capital", and solve the problems of "lack of long money" and "no rice in the pot" in the industry.
●On the investment side, many venture capital institutions report that "it is difficult to invest even if there is money", and they cannot find good investment objects and investment projects. In order to solve this problem, the National Development and Reform Commission will take the lead, in conjunction with relevant ministries and commissions, to establish a docking mechanism for venture capital and innovation and entrepreneurship projects, so as to provide a number of high-quality and good projects that are in line with the national development direction and strategic orientation for the majority of venture capital institutions, and solve the problem of where to invest money.
●On the management side, it is proposed to continue to strengthen the management of venture capital funds funded by the government and state-owned enterprises, and establish and improve the management system and due diligence compliance liability exemption mechanism in line with the characteristics and development laws of the industry. In view of the tax and regulatory issues that are of general concern to all parties, it is proposed to continue to implement the preferential tax policies for venture capital enterprises. At the same time, in accordance with the relevant requirements of the Regulations on the Supervision and Administration of Private Investment Funds, differentiated regulatory policies are implemented for venture capital funds that are treated differently from other private funds.
●On the exit side, the focus is on broadening exit channels and optimizing the exit policy of venture capital funds.
In terms of broadening funding sources
We are studying and exploring ways to expand the scope of pilot projects for financial asset investment companies
General Administration of Financial Regulation:
Many start-up technology companies reported that they hoped to receive financial support in terms of capital. The State Administration of Financial Supervision is studying and demonstrating the work plan in accordance with the relevant arrangements.
●Thoroughly sort out and summarize the experience of direct equity investment carried out in Shanghai in the early stage, study and expand the scope of the pilot area, give full play to the professional advantages of financial asset investment companies in venture capital, equity investment and enterprise restructuring, and increase support for scientific and technological innovation.
●Equity financing is different from debt financing, and this work also requires prudent demonstration of the work plan and reasonable and effective risk control. Under the premise of compliance with laws and regulations and controllable risks, the State Administration of Financial Supervision actively supports relevant banks and financial asset investment companies to carry out business cooperation, promotes project information sharing and exchange, gives full play to the two mechanisms and advantages of equity financing and debt financing, and actively explores diversified financial service models for scientific and technological innovation.
●Encourage banks to strengthen the docking with venture capital funds, standardize the development of "loan + external direct investment" business, effectively solve the financing difficulties and pain points of start-ups, and promote the virtuous cycle of "capital-capital-assets" of enterprises.
Study raising the upper limit of the proportion of insurance funds investing in venture capital funds
General Administration of Financial Regulation:
Continue to optimize the regulatory policies for insurance funds
The State Administration of Financial Supervision has successively issued five regulatory policy documents, including the investment of insurance funds in venture capital funds and financial equity investment, comprehensively breaking down the institutional obstacles that hinder insurance funds from carrying out equity investment, venture capital and supporting scientific and technological innovation, allowing insurance funds to invest in equity investment funds actually controlled by non-insurance financial institutions, abolishing the restriction on the scale of investment in a single venture capital fund, supporting insurance institutions to strengthen cooperation with professional equity investment institutions, and broadening the sources of long-term funds for start-up enterprises. At present, the investment of insurance funds in venture capital funds is smooth at the level of regulatory policies.
Meet the multi-level investment needs of the financial market
●The State Administration of Financial Supervision actively supports trust companies, wealth management companies and other asset management institutions to increase their support for venture capital, and develops long-term investment asset management products that are compatible with venture capital in accordance with the principle of "sellers are responsible, buyers are responsible".
●In order to effectively control financial risks, the "New Regulations" restrict the downward investment of asset management products, that is, the reinvestment of asset management products into asset management products, which is actually called nesting, and limits the number of layers. In line with the principle of vigorously supporting the development of venture capital, we have actively cooperated with the National Development and Reform Commission to issue a special policy to allow qualified venture capital funds to be regarded as a first-tier asset management product when they accept investment in asset management products, which is equivalent to relaxing regulatory requirements to a certain extent on the basis of controllable risks, which is also conducive to better playing the role of asset management products and actively supporting the development of venture capital "parent funds".
In the next step, the State Administration of Financial Supervision will continue to optimize the rules for the use of insurance funds, study and increase the upper limit of the proportion of insurance funds investing in venture capital funds, and better guide insurance funds and related asset management institutions to increase the allocation of venture capital funds under the premise of legal compliance and controllable risks, and actively promote the high-quality development of venture capital.
Focusing on the key links of institutional mechanisms such as fund assessment, fault tolerance and exemption mechanism, and performance evaluation system, we take the lead in cultivating state-owned assets and government investment funds into patient capital
National Development and Reform Commission:
In addition to fully respecting the laws of the market, the "visible hand" of the government can also play an important role in guiding all kinds of capital to abandon the impetuous mentality of "quick success, fast entry and quick exit, and quick money", and insist on long-term investment, strategic investment, value investment, and responsible investment.
● Insurance funds
Insurance funds are "long money" in the traditional sense, with a long term of funds and an investment strategy of stable income.
● Bank funds
The mainland is a bank-led financial system, and the banking assets account for more than 90% of the total assets of financial institutions.
● State-owned assets and government investment funds
Properly handle the relationship between government funds and market-oriented funds. To this end, the "Policy Measures" proposes to focus on the key links of institutional mechanisms such as fund assessment, fault tolerance and exemption mechanism, and performance evaluation system, and take the lead in cultivating state-owned assets and government investment funds as patient capital and play a leading and exemplary role.
Encourage central enterprises to use venture capital funds to invest early, small, long-term, and hard technology
State-owned Assets Supervision and Administration Commission of the State
Up to now, the central enterprises have managed a total of 126 venture capital funds, with a subscription scale of 52.9 billion yuan and an investment amount of 31.3 billion yuan, mainly invested in advanced manufacturing, energy, electronic information and other fields, and have achieved positive results in promoting scientific and technological research and increasing investment in scientific research.
In the next step, the SASAC will be based on its own responsibilities and positioning, strengthen communication and coordination with relevant departments, and give greater support to the central enterprise venture capital fund in terms of relaxing scale restrictions, increasing the proportion of capital contribution, focusing on overall performance and long-term return assessment, and clarifying the conditions for due diligence and fault tolerance. At the same time, we will also guide the central enterprises to make full use of the current relevant policies, focus on the main responsibilities and main businesses, combine their own advantages and conditions, use venture capital funds to increase investment in industry science and technology leaders, the transformation of scientific and technological achievements and the upstream and downstream small and medium-sized enterprises in the industrial chain, encourage early, small, long-term, and hard technology, give full play to the role of long-term patient capital, support strategic emerging industries and future industries, help cultivate and develop new quality productivity, and further promote the high-quality development of the real economy.
In terms of cultivating venture capital entities
For venture capital institutions that invest in new tracks such as originality and leading scientific and technological innovation, it is necessary to increase policy support
National Development and Reform Commission:
The first one is "Professional".
●Encourage venture capital institutions to start from their own unique advantages, strengthen professional investment concepts and investment strategies, strengthen post-investment "empowerment" of investment projects, and improve comprehensive service capabilities such as equity investment, industry guidance, and strategic consulting.
●In particular, for venture capital institutions that invest in new tracks such as originality and leading scientific and technological innovation, it is necessary to increase policy support and support the development of professional venture capital institutions.
●In the process of screening venture capital projects, the National Development and Reform Commission will take the lead and establish a project docking mechanism for venture capital institutions and investment target start-ups in conjunction with relevant departments, so as to avoid limited information and information asymmetry leading to good projects not being explored.
The second is "diversity".
Encourage industry backbone enterprises, scientific research institutions, entrepreneurship and innovation platform institutions and other entities with rich entrepreneurial and innovation resources, angel investment individuals with capital strength and management experience, insurance funds, government investment funds and other professional institutional investors to actively participate in venture capital, and form a diversified venture capital entity.
The third is "norms".
On the basis of complying with the relevant laws and regulations, the majority of investment institutions must fulfill their fiduciary obligations, be entrusted by others, manage money on behalf of others, be loyal to others, effectively protect the legitimate rights and interests of investors, guide venture capital institutions to strengthen internal control mechanisms, compliance management and risk management mechanisms, and continuously improve the standardized operation and management level of venture capital institutions.
In terms of improving the exit mechanism
How to alleviate the "difficulty of exiting" venture capital?
Sfc:
First of all, it is necessary to optimize the functions and mechanisms of the multi-level capital market.
Since the beginning of this year, the China Securities Regulatory Commission has successively issued the "Sixteen Measures for Capital Market Service Technology Enterprises" and the "Eight Measures for Deepening the Reform of the Science and Technology Innovation Board" to establish and improve the "green channel" for equity financing, mergers and acquisitions and restructuring for "hard technology" enterprises that carry out key core technology research.
Actively improve the support policies for mergers and acquisitions, improve the inclusiveness of the valuation of mergers and acquisitions, enrich the payment tools for mergers and acquisitions, and encourage mergers and acquisitions funds to play a better role.
Pay attention to the role of the "reverse linkage" mechanism of private equity venture capital fund share reduction and investment period. By the end of the first quarter of this year, more than 2,000 applications for "reverse linkage" had been processed.
The second aspect is to take multiple measures at the same time to broaden diversified exit channels.
A pilot project is being carried out for the in-kind distribution of shares by private equity venture capital funds, allowing the shares of listed companies held by them to be distributed to investors through non-transaction transfers, which not only enriches the exit channels, but also helps to alleviate the impact on the market.
It has successively carried out pilot work on the share transfer of private equity funds in seven places, including Beijing, Shanghai, Guangdong, Zhejiang, Ningbo, Jiangsu and Anhui, and has completed the transfer of private equity shares of 23.2 billion yuan. The pledge financing of private shares is 31.6 billion yuan, and this pilot work will also be conducive to supporting the further development of the second-hand share transfer fund, which is what we call the S fund.
Third, we will continue to maintain the smooth channels for overseas listings.
As of last Friday, a total of 158 enterprises had completed their filings for overseas listings, of which 85 were listed in Hong Kong and 73 in the United States.
Source | Chinese government website
Edit | Wang Shu