In Finance, What Is an Originator?

The fund sponsor refers to the institution that initiated the establishment of the fund, and it plays an important role in the establishment of the fund. In China, according to the provisions of the Interim Measures for the Administration of Securities Investment Funds.

Fund sponsor

Fund sponsor refers to

Fund sponsors have applications to set up a fund, attend or appoint a representative to attend

1. Comply with fund contracts;

2. announcement

It is necessary for the law to provide for the legal status of the fund sponsor, which is reflected in market entry qualifications and rights and obligations in terms of the sponsor's legal status. As far as eligibility is concerned, China has provided for it. For example, the 1997 Interim Measures for the Administration of Securities Investment Funds stipulated that the main promoters of Chinese funds are securities companies, trust companies, and fund management companies established in accordance with relevant state regulations. The promoter must have

(1) The paid-in capital of each fund promoter is not less than 300 million yuan. The main sponsor has more than 3 years of experience in securities investment and has a record of continuous profit, except for fund management companies.

(2) Each fund promoter has a sound organization and management system, good financial status, and standard operating behavior

(3) There are operating places, safety precautions and other facilities related to the business that meet the requirements

(4) Have a clear and feasible fund issue plan

(5) Other conditions of China Securities Regulatory Commission. In addition, the Pilot Measures for Open-ended Securities Investment Funds stipulate that open-ended funds are established by managers, that is, the promoters of open-ended funds are fund management companies.

In addition to meeting the conditions stipulated in (3), (4) and (5) of the Interim Measures,

(1) Have clear, legal and reasonable investment directions

(2) There is a clear form and operating mode of the fund organization.

(3) The fund manager and custodian have no major illegal or illegal acts. From the perspective of the legislative practice of various countries, the promoters of company funds directly apply the relevant provisions of the company law, and the qualifications of sponsors of contract funds are regulated by the trust law or investment fund law.

For example, the 40-year "Investment Company Law" in the United States, which is dominated by corporate funds, does not provide qualifications for sponsors, but the 2001 version of the "Taiwan Trust and Investment Enterprise Management Rules" provides:

(1) The sponsor of a securities investment fund invests in a trust enterprise, that is, the fund manager.

(2) The sponsor's own capital must not be less than NT $ 300 million. Another example is the "Securities Investment Trust Act of 1993" stipulated that the entrusted company (fund manager) is an applicant for a securities investment fund. In terms of forecasting, it shall meet the qualifications for setting up a fund and acting as an entrusted company.

Unfortunately, the current fund law does not provide for the qualifications of fund sponsors, and there are three factors to be considered in order to do so:

(1) The successful establishment of the fund,

(2) Fund funds security after fund establishment.

Fund Initiation Meeting

(3) Protection of the interests of fund investors. The author believes that protecting the interests of investors is of paramount importance. Because in the case of China's securities market is extremely irregular, lack of integrity, and investor protection mechanisms are extremely weakened, strengthening the protection of investor interests is the inevitable orientation of fund legislation. Based on these considerations, in addition to the five conditions stipulated in the Interim Measures, the fund sponsor's qualifications should also include the following:

(1) The fund sponsor shall hold a certain percentage of fund shares and shall not be redeemed or transferred during the life of the fund. This is to prevent the promoters from tying the interests of the investors to the interests of the investors for their own benefit. "In the legislation of various countries, in order to prevent the propensity of the promoters from" opportunism ", special provisions are made on their investment proportions and the duration of fund bonds. Redemption of fund bonds held by him.

(2) The fund manager may be the fund sponsor, but may not be the sole promoter. According to Article 36 of the current Fund Law, "the fund manager sells fund shares in accordance with this law and raises funds", he believes that the fund sponsor can only be a fund manager. In fact, this is a misunderstanding. This is only a description of the fund manager's duties and rights. According to this, the fund manager cannot be regarded as the fund sponsor. In fact, compared with the 1997 Interim Measures for the Administration of Securities Investment Funds, the Fund Law does not clearly define the legal status of the sponsor. In view of the fact that the fund manager is selected by the fund sponsor, the fund sponsor acts as the fund's co-trustor to entrust the fund to the fund manager according to the fund contract. If the fund manager overlaps with the fund sponsor, the trustee will entrust himself Therefore, there is a problem of how to sign a commission contract to effectively protect the interests of fund investors. Based on this, the author believes that the law should prohibit the administrator from becoming the sole initiator.