CFA: Fund managers should conduct long-term assessments of investment managers who hold dual roles for more than 5 years.

On June 12th, the China Securities Investment Fund Industry Association issued a revised "Guidelines for Fund Managers Concurrently Serving as Investment Managers of Private Fund Management Plans". It mentioned that fund managers should strengthen the long-term assessment mechanism for concurrently serving investment managers, conducting assessments for a period of 5 years or more. Assessment and incentive indicators should cover all aspects of portfolio long-term performance, compliance and integrity, fair trading execution, etc., and should not be directly linked to the management fees or performance fees of the private fund management plans they manage. Concurrently serving investment managers and their immediate family members are not allowed to invest in the private fund management plans they manage. The original text continues: Announcement on the Publication of the Revised "Guidelines for Fund Managers Concurrently Serving as Investment Managers of Private Fund Management Plans" China Securities Investment Fund Industry Association No. 2026-12 In order to implement the "Action Plan to Promote High-Quality Development of Public Funds," further regulate the concurrent management of public and private investment managers, enhance the risk isolation requirements of public and private businesses, and continuously improve industry compliance levels, the China Securities Investment Fund Industry Association has revised the "Guidelines for Fund Managers Concurrently Serving as Investment Managers of Private Fund Management Plans" (hereinafter referred to as the "Concurrent Guidelines"), which are now publicly released. The "Concurrent Guidelines" have been filed with the China Securities Regulatory Commission and will be implemented from June 12, 2026. This announcement is hereby made. China Securities Investment Fund Industry Association June 8, 2026 Guidelines for Fund Managers Concurrently Serving as Investment Managers of Private Fund Management Plans Article 1 In order to further regulate the appointment of investment managers concurrently serving as fund managers and private fund management plan investment managers (hereinafter referred to as managers), safeguard the legitimate rights and interests of investors, and in accordance with the People's Republic of China Securities Investment Fund Law, the Management Measures for Private Asset Management Business of Securities and Futures Operating Institutions, the Management Guidelines for Investment Management Personnel of Fund Management Companies, the Registration and Registration Rules for Investment Management Personnel of Securities and Futures Operating Institutions, as well as laws, administrative regulations, regulations and self-discipline rules of the China Securities Regulatory Commission (hereinafter referred to as the CSRC), these guidelines are formulated. Article 2 Fund managers should always adhere to honesty and creditworthiness, fulfill their duties, be cautious and diligent, fully protect the legitimate rights and interests of investors, and ensure fair treatment of different investment portfolios. Investment managers should strictly abide by laws and regulations, adhere to professional ethics, establish a good compliance awareness and risk control consciousness. Article 3 Fund managers should strengthen risk isolation, strictly implement internal control management, fair trading, information isolation, information disclosure regulations, carefully assess potential conflicts of interest, improve internal management systems, work processes, and system settings, clarify the responsibilities of relevant departments and personnel, enhance the fairness of trading analysis and abnormal trading monitoring mechanisms between multiple portfolios managed by the same investment manager, improve information disclosure and abnormal situation reporting systems, strengthen incentive constraints and accountability mechanisms. Fund managers should take effective measures to ensure the separation of public fund management business and private asset management business in terms of premises, personnel, accounts, funds, information, etc., strictly control the improper flow and use of sensitive information, effectively prevent insider trading, use of undisclosed information trading, conflicts of interest, and improper benefits transfer. Article 4 Fund managers should have good and continuous compliance and risk control capabilities, have not been subject to criminal penalties or administrative penalties in the past year, have not been subject to administrative regulatory measures, disciplinary actions such as temporarily suspending product registration or filing due to internal control deficiencies, investment management violations, unfair treatment of investors, etc. Article 5 In addition to meeting the conditions stipulated in the Registration and Registration Rules for Investment Management Personnel of Securities and Futures Operating Institutions, investment managers concurrently serving investment managers should also meet the following conditions: (1) Have good professional ethics and integrity record, have not been subject to criminal penalties, administrative penalties, administrative regulatory measures, or disciplinary actions in the past 5 years; (2) Have good investment management ability and a clear and stable investment style; (3) Have at least 5 years of equity public fund, equity private asset management plan, or at least 5 years of investment management experience with pension and social security portfolios. Article 6 Fund managers should carefully assess the needs of investors, product investment strategies, compliance and risk control capabilities, as well as the professional performance and work experience of investment managers, and determine whether to allow concurrent appointments through the investment committee or higher-level internal decision-making, as well as the number, scale, and investment strategy of products to be concurrently managed, and identify, assess, and manage potential conflicts of interest that may arise after the concurrent appointment. The compliance department should supervise the relevant decisions and processes. Fund managers should ensure that concurrently serving investment managers have sufficient professional capabilities, and reasonably allocate the number and scale of all products managed by the same investment manager. In principle, the number of public funds and private asset management plans managed by the same investment manager should not exceed 10, except for products that are invested according to the composition proportion of relevant indexes. Article 7 Fund managers shall not employ the following personnel as concurrently serving investment managers: (1) Fund managers of significant money market funds, managers of products managed by the fund management party, and managers of public fund infrastructure securities investment funds; (2) Investment managers of products managed by the managers of the fund management party; (3) Investment managers of private asset management plans managed by non-commercial banks and their wealth management subsidiaries, insurance institutions, and other long-term fund management entrusted by medium and long-term assets management plans; (4) Personnel providing securities investment advisory services for asset management products; (5) Other personnel who are prohibited from concurrently serving according to laws, regulations, and self-discipline rules. Article 8 Fund managers should strengthen the management of investment trading activities between multiple portfolios managed by the same investment manager, conducting monitoring, analysis, evaluation, and verification to prevent unfair trading, including: (1) Strengthening investment order management. In the process of issuing investment orders, it should ideally be "simultaneous and at the same price." When multiple portfolios managed by concurrent investment managers purchase or sell the same securities on the same day, investment orders should be sent simultaneously, and price spread monitoring management should be conducted through fair trading systems. If, due to product strategies or position changes, it is not possible to trade simultaneously and at the same price, the fund manager should authorize and manage accordingly, and strengthen post-analysis; (2) Strengthening management of non-exchange bidding matching businesses. In activities such as participating in securities issuance subscriptions, inquiry transfers, block trades, etc., investment managers concurrently serving should treat various managed portfolios fairly and should not seek undue benefits for specific products in quotations, internal allocation, etc.; (3) Strengthening management of trading behaviors. In principle, reverse trading between concurrent portfolios on the same day should be avoided. Fund managers should strengthen control and monitoring of the price spread of same-day and near-day transactions and reverse transactions between multiple portfolios, except for specific situations such as products that are fully invested according to the composition proportion of relevant indexes; (4) Strengthen trading monitoring and analysis. Monitoring abnormal trading situations such as price spreads, reverse trading, related party transactions, price anomalies, quantity anomalies, time anomalies, etc., under different time windows, with the longest time window extending to more than 10 trading days, and combining factors such as transaction sequence, price deviation, product size, trading volume, etc., to analyze whether there are trading convergence and unfair treatment between multiple portfolios. Concurrent investment managers should provide explanations for abnormal trading situations, and the compliance risk control department should conduct strict review and independent assessment of the explanations provided by concurrent investment managers, with relevant materials kept for reference; (5) Strengthening post-reporting mechanisms. If the compliance risk control department finds actual abnormal trading situations after reviewing the explanations provided by concurrently serving investment managers, the fund manager should immediately report to the local securities regulatory bureau. Fund managers should analyze the yield differences of multiple portfolios managed by the same investment manager in supervision and audit reports and explain the potential problems and improvements of the fair trading mechanism. Fund managers should include investment advisory services in the fair trading mechanism of the company as stipulated in the preceding paragraph. Article 9 Fund managers should strengthen information isolation management and confidentiality management of concurrent investment managers, regularly check and verify whether the user permissions of information system match their job responsibilities, and prevent improper flow and use of sensitive business information between public fund management businesses and private asset management businesses. Concurrently serving investment managers should not disclose or improperly use sensitive information obtained in their work, should not obtain sensitive information unrelated to their job responsibilities, and should not use sensitive information to seek or transfer improper benefits. Concurrently serving investment managers should not concurrently serve as department heads in public fund management businesses and private asset management businesses. Article 10 Fund managers should strengthen the long-term assessment mechanism for concurrently serving investment managers, conducting assessments for a period of 5 years or more. Assessment and incentive indicators should cover all aspects of the long-term performance of the concurrently managed portfolios, compliance and integrity, fair trading execution, etc., and should not be directly linked to the floating management fees or excess performance fees of the private asset management plans managed by them. Concurrently serving investment managers and their immediate family members should not invest in the private asset management plans they manage. Article 11 Fund managers should fully disclose the concurrent situation of fund managers in regular reports to protect the interests of fund shareholders, including: (1) Concurrent situation of fund managers. Disclose in regular reports: the number, types, scales, and tenure of products concurrently managed by fund managers; (2) Fund management compensation mechanism and holding of products. Disclose in annual reports: the situation of fund managers themselves and immediate family members investing in products managed by themselves; (3) Execution of fair trading mechanisms. Disclose in annual reports: enhancements made by fund managers to fair trading mechanisms to prevent potential conflicts of interest from concurrent actions, as well as fair trading management situations between multiple portfolios managed by fund managers in the annual reports. Article 12 Fund managers who intend to appoint investment managers to concurrently serve as fund managers and investment managers should register with the China Securities Investment Fund Industry Association (hereinafter referred to as the Association), in addition to the registration materials required by the Registration and Registration Rules for Investment Management Personnel of Securities and Futures Operating Institutions, the following materials should also be submitted to the Association: (1) Feasibility analysis report, including arrangements in internal control systems, work processes, system settings, etc., and assessments of the professional competency of the proposed investment managers; (2) Compliance review report, including compliance and integrity situations of the fund managers in the past year and compliance and integrity situations of the proposed investment managers in the past 5 years; (3) Explanation of the system arrangements to prevent benefits transfer, including measures taken by the fund manager to prevent unfair trading and benefits transfer violations. The Association shall process the registration formalities within 10 working days upon receiving the registration materials and notify the fund manager. If investment managers no longer serve concurrently, the fund manager should promptly apply to the Association for the cancellation of concurrent registration or registration. Article 13 If the fund manager no longer meets the requirements of these guidelines, concurrently serving investment managers should not be allowed to manage additional private asset management plans. If concurrently serving investment managers no longer meet the requirements of these guidelines, they should immediately stop serving concurrently. The fund manager should first dismiss the investment manager of the private asset management plan and promptly communicate with investors to properly handle related matters. Article 14 The Association will conduct self-discipline management for investment managers concurrently serving as fund managers and investment managers based on these guidelines and related self-discipline rules. When filing for a private fund management plan, if an investment manager is concurrently serving as a fund manager and investment manager for the first time, registration procedures for investment managers should be completed with the Association in accordance with these guidelines. The Association regularly submits information on investment managers concurrently serving as fund managers and investment managers to the CSRC. Article 15 If a fund manager violates the provisions of these guidelines, the Association may record relevant information in their integrity files and take self-discipline management or disciplinary measures such as verbal reminders, written warnings, requests for corrections within a time limit, warnings, industry condemnations, public condemnations, restrictions on related business activities, etc.; for directly responsible senior managers and other directly responsible personnel, relevant information may be recorded in their integrity files and self-discipline management or disciplinary measures such as verbal reminders, written warnings, warnings, industry condemnations, public condemnations, etc., may be taken depending on the severity. If investment managers violate the provisions of these guidelines, the Association may record relevant information in their integrity files and take self-discipline management or disciplinary measures such as verbal reminders, written warnings, participation in compliance education, warnings, industry condemnations, public condemnations, prohibition from engaging in relevant business, inclusion in a blacklist, cancellation of fund industry qualifications, etc. If the Association discovers that a fund manager and related personnel are suspected of violating laws, regulations, administrative regulations, or CSRC provisions, the case will be referred to the CSRC for further action. Article 16 Securities firms that appoint investment managers to concurrently serve as the investment manager of large collective products that meet the regulation's requirements and the investment manager of private fund management plans should follow the guidelines. Securities and futures operating institutions that appoint fund managers or private asset management plan investment managers to concurrently serve as managers of pension, social security, and retirement fund products should follow articles 8 to 10 of these guidelines, unless the relevant regulatory authorities have other regulations for the management of pension, social security, and retirement fund products. Fund managers appointing non-equity investment managers to concurrently serve as fund managers and investment managers for collective asset management plans or single or collective asset management plans for commercial banks and their wealth management subsidiaries, insurance funds, are not subject to the third item of Article 5 of these guidelines. Article 17 Equities public funds referred to in these guidelines refer to equity funds, equity balanced funds, and equity qualified domestic institutional investor funds, as well as overseas equity public fund products. Fund managers who manage mixed public funds other than equity balanced funds, and meet one of the following conditions, are considered to have equity public fund management experience: (1) Co-managing with other fund managers and responsible for equity asset investments of public funds; (2) Managing independently, and the equity asset position ratio of public funds at the end of each quarter during the management period exceeds 60%. Equity private asset management plan investment management experience is assessed based on equity public fund management experience. Article 18 These guidelines take effect from June 12, 2026, and the "Guidelines for Fund Managers Concurrently Serving as Investment Managers of Private Fund Management Plans (Trial)" (CBIA No. 2020-55) is simultaneously repealed. For fund managers who do not meet the requirements of these guidelines but have already appointed investment managers to concurrently serve as fund managers and investment managers, they should make corrections or adjustments within 12 months from the date of implementation of these guidelines. For existing asset management plans that do not comply with the provisions of the second paragraph of Article 10 of these guidelines, no new net participation of concurrently serving investment managers and their immediate family members shall be allowed before the contract expires, and no renewal of the contract shall be allowed after the contract expires. This article is compiled from the official website of the China Securities Investment Fund Industry Association, edited by Xu Wenqiang.