1. Can private equity funds serve as general partners?
General partners refer to natural persons, legal persons and other organizations that bear unlimited joint and several liabilities for the debts of the partnership according to law. The Partnership Enterprise Law stipulates that wholly state-owned companies, state-owned enterprises, listed companies, public welfare institutions and social organizations shall not become general partners. Partnership private equity fund is a private equity fund composed of general partners and limited partners. The general partner is a private equity fund manager and is jointly established with limited partners with no more than 49 people. Different from the past, partnership private equity funds can only invest in PE investment, and partnership private equity funds can also open stock investment accounts in the secondary market.
2. What are the characteristics of partnership private equity funds?
Private equity funds in the form of limited partnership can effectively avoid double taxation, ensure the interests of operators and owners are consistent under the condition of separation of ownership and management rights through reasonable incentive and restraint measures, promote the division of labor and cooperation between general partners and limited partners, and give full play to their respective strengths and advantages; In addition, the limited partnership private equity fund has the characteristics of low threshold, simple establishment procedure, simple and flexible internal governance structure, efficient decision-making procedure and flexible benefit distribution mechanism.
From the legal point of view of limited partnership, limited partnership private equity funds also have the following characteristics:
1. The property of a limited partnership private equity fund is independent of the property of each partner.
As an independent unincorporated enterprise entity, limited partnership private equity fund has independent property; For the debts of the partnership, firstly, the partnership's own property is used to pay off the debts, and the insufficient part is borne according to the different status of each partner; During the existence of a limited partnership, each partner may not require the division of the partnership property. Thereby ensuring the property independence and stability of the limited partnership private equity fund.
2. General partners and limited partners enjoy different rights and bear different responsibilities.
In a limited partnership, the general partner carries out the partnership affairs, and the limited partner does not participate in the operation of the partnership; Limited partners shall be liable for the debts of the partnership to the extent of their subscribed capital contributions, and general partners shall be jointly and severally liable for the debts of the partnership. This institutional arrangement can urge the general partner to carry out the partnership affairs carefully; For limited partners, it has the advantage of controllable risks.
To sum up, the general partner shall bear unlimited joint and several liability for the debts of the company. According to the law, state-owned enterprises and institutions cannot become general partners, while private equity funds are mostly private enterprises or private enterprises, which can participate in enterprise management as general partners.