The lack of legal system and the imperfection of supporting system make there is no soil for the growth of corporate funds in China. At present, more than 60 domestic funds are contractual funds. A few years ago, the short-lived corporate fund "Zibo Fund" was quietly changed into a contractual fund. However, the further development of contractual funds is now very difficult. Not only are two-thirds of the fund operations in a loss state, but there is even a phenomenon of hard apportionment in the process of fund issuance. Some fund managers have abused their rights and violated regulations, such as "Tsingtao Beer Incident" and "Shenzhen Expressway Incident". Finally, the investment varieties and operating concepts of contract funds are almost "one thousand people", which is seriously homogenized, and the lack of personalized services by institutional investors has led to a general decline in the market's desire to invest in such funds. At the same time, corporate funds are actually completely inoperable and unable to change this situation.
At present, the problems existing in enterprise funds are mainly manifested in the following aspects:
1. Legal vacancy of company funds: "It shall be stipulated separately in the State Council" has not been issued. The actual operation of company funds is restricted by company law, fund law and trust law, but it is not clearly defined. In this way, the rights and obligations of many parties are unclear, with many disadvantages and low operability. It is difficult to form a smooth market-oriented operation in many aspects such as reasonable cost, periodic report, internal control mechanism and performance evaluation of capital operation.
Second, the tax policy of investment funds is still vacant: according to the company law, enterprise funds are treated equally with ordinary enterprises in taxation and must pay high taxes such as business tax and enterprise income tax. Nearly 50% of enterprise income tax and business tax make enterprise funds overwhelmed and lose the operability of market operation, which is not at the starting line with contractual Public Offering of Fund. In practice, this leads to the institutional investment market can only be confined to the narrow contractual Public Offering of Fund and numerous underground accounts of "investment consultants", which hinders the healthy development of the professional, efficient and large-scale institutional investment market.
Third, the subscription and redemption of the company's funds are not operational at all: the procedures for capital increase and capital decrease in the process of industrial and commercial registration are too cumbersome and lengthy. As a special type of "investment company", corporate funds have the same procedures for increasing and decreasing capital as ordinary enterprises. The industrial and commercial procedures for capital increase need 5 working days, the industrial and commercial procedures for capital reduction need to be announced in newspapers at or above the provincial level for 45 days, and the industrial and commercial procedures need 5 working days. Such a long industrial and commercial process makes it difficult for corporate funds to capture market opportunities. Although we confirmed in the investigation with the industrial and commercial registration department that this special "investment company" can complete the formalities of capital increase or capital decrease within 3 days, and realize the integration with international T+3 processing.
Fourth, the sub-warehouse settlement of Shanghai Stock Exchange is not in place: institutional investors usually buy and sell a large amount, and placing orders through sub-warehouse is an essential function in developed markets. There are many advantages to placing orders in different warehouses, including reducing the impact on the market, avoiding possible market manipulation and improving the service level and competitiveness of brokers. The Shenzhen Stock Exchange has been able to settle accounts in different places. However, due to design problems, in the current practice, most investment institutions adopt the method of buying more seats or opening more accounts, which on the one hand increases the operating cost, on the other hand makes it impossible to evaluate the net fund value of custodian banks, and at the same time, the supervision department cannot understand the overall situation of fund positions, which will seriously hinder the development of the professional level of custodian banks in China. From the perspective of exchanges and clearing companies, this undoubtedly increases the costs and risks in the process of trading and settlement.
Fifth, the announcement system is too localized, inefficient and costly: the "newspaper" announcement in the relevant operation process needs newspapers at or above the provincial level. These newspapers are relatively too localized, and due to the limitation of layout, the queuing efficiency of announcements is often low. For professional departments providing legal services for institutional investment, it is very difficult to collect relevant information from newspapers and periodicals at or above the provincial level for professional operation and confirmation. These are not conducive to the establishment of commercial credit system and effective commercial operation. The current announcement system can not meet the professional requirements of China's commercial activities, and it can not meet the frequent capital increase and capital decrease operations in enterprise capital operation.
The long-term absence of institutional investor market is an important reason for the low investment skills and efficiency of China's capital market, and it is also one of the main reasons why the performance of China's capital market deviates from the sustained and rapid growth of the national economy. The mismatch of laws and regulations has also led to the adoption of "curve saving the country" in China's institutional investment market and the adoption of indigenous methods in succession. As a result, the professional level is low, the cost of entering the market is high, the operating cost is high, the evaluation is difficult, and the relevant market environment cannot cultivate growth. Therefore, it is time for China to introduce reasonable fund laws and institutional arrangements.