Tianjin Development Zone Leads Development of Private Equity Investment in China

Jan 11, 2010, 08:00 ET from Tianjin Economic Technological Development Area

TIANJIN, Jan. 11 /PRNewswire-Asia/ -- The office of the National Development and Reform Commission (NDRC) of China approved applications for the record from 13 venture (equity) investment management enterprises in December, 2009, including Qianxin Culture & Investment Management. This is the third batch of enterprises receiving approval for the record from the NDRC following CDH Investments (Tianjin) and Hony Capital (Tianjin) getting approval in June 2008 and such seven venture (equity) investment management enterprises, including CCB Healthcare Investment Management (Tianjin), getting approval in April, 2009. There were a total of 22 enterprises getting approval for the record, including 16 equity investment fund management enterprises the NDRC implemented and tried beforehand in Tianjin Binhai New Area, with 13 based in the Tianjin Development Zone and 3 based in other areas within Binhai New Area; as well as the remaining 6 venture investment management enterprises, with which, the State Council of China supported Beijing Zhongguancun Science and Technology Zone to establish national independent innovation zones.

Since the newly revised law of partnership established the parameters of the limited partnership form in 2007, the development of private equity funds has been protected by law. Tianjin Development Zone firstly completed the commercial registration of the city's first equity investment fund enterprise invested by people in 2007. Then, the Tianjin Administration for Industry and Commerce issued measures for the commercial registration management of private equity fund enterprises and private equity investment fund management limited companies (enterprises); Tianjin Local Taxation Bureau made timely and clear replies on the tax registration and taxation service policies for partners of private equity investment fund enterprises and private equity investment fund management limited companies (enterprises). The successful implementation and high-quality services provided by Tianjin Development Zone's commerce and tax registrant authorities allowed the rapid development of regional private equity funds (fund management enterprises). As of the end of December, 2009, Tianjin Development Zone owned 174 private equity funds/fund management enterprises, as well as realized subscribed capital contributions of RMB47 billion (approx US$6.89 billion) and real capital contributions of RMB7.5 billion (approx US$1.10 billion). In addition, 20 percent of fund enterprises began their investment into projects. Among the funds managed by the 13 fund management enterprises, which received approval from the NDRC, 10 funds began to invest capital raised in such industries as healthcare, energy, property, M&A and reorganization of state-owned enterprises, equipment leasing and culture and media; 2 funds received an amount of investment of RMB2 billion (approx US$293 million) from the National Social Security Fund of China, respectively; 3 funds invested in projects in Tianjin; 7 funds' investors came from large and medium-sized institutions; 3 funds began their tax payments.

Looking through the development of the private equity investment across China, Tianjin occupied the leading position, Binhai New Area took the leading position in Tianjin, and Tianjin Development Zone took the leading position in Binhai New Area. Tianjin Development Zone occupied first place across the country in terms of the number of equity investment enterprises receiving approval for the record from the NDRC and the number of equity investment enterprises. The Development Zone now occupies the leading position in China in providing services for and managing private equity investment development enterprises, whether in terms of laws, the policy enforcement environment or other related services, including commercial and tax registration and banking services, and will continue to lead the country's private equity investment development in future.

SOURCE Tianjin Economic Technological Development Area