In August 2025, the "Second Private Securities Compliance and Risk Control Workshop · Shanghai Session," co-hosted by Jimu, isimu, and Llinks Law Offices, concluded successfully. More than 30 compliance and risk control experts from various institutions participated in the workshop.
One year has passed since the official implementation of the Guidelines on the Operation of Private Securities Investment Funds. In 2025, local branches of the China Securities Regulatory Commission (CSRC) have continuously raised the requirements for self-inspections by private funds and are also strengthening compliance management for small private fund institutions. This promotes market-driven survival of the fittest and encourages leading institutions to adopt a public fund management model. In this context, personnel in operational, compliance, and risk control roles at private fund institutions urgently need professional and systematic training to master the concepts and solutions for building a daily compliance and risk control system and to clarify the boundaries of relevant professional issues.
Before the workshop began, Ms. Ying Yang from isimu hosted the event and introduced the guests and the significance of this in-person workshop.
Following this, Mr. Zhiyuan Huang, a pre-sales solutions engineer from isimu, shared "Compliance Practices for Building a Private Fund Institution's Trading Risk Control System."
Mr. Huang provided a detailed and comprehensive presentation based on current regulatory requirements, key points for building daily trading risk control, and his experience from on-site research. He discussed practical configurations for IT and trading risk control systems for managers of different sizes. Mr. Huang stated that the authority of compliance and risk control personnel largely determines whether a private fund can control its risks, and is a key factor in effectively implementing risk management. In some industry-leading companies, compliance and risk control heads have significant authority, with some even having a one-vote veto, which demonstrates the institution's emphasis on risk control and represents an advanced governance structure.
Mr. Xin Jia, a private fund business product manager from Jimu, shared "Practical Procedures and Requirements for Major Changes to Private Fund Managers."
Mr. Jia has rich experience in executing solutions for the establishment and changes of private fund managers. He shared insights with the attendees on the status of major manager changes in recent years, key points to note for different types of changes, and practical case studies. Mr. Jia stated that changes involving controlling shareholders and actual controllers require great caution. A thorough review is needed to ensure the manager fully complies with the requirements of the Measures for the Registration and Filing of Private Investment Funds, with a key focus on the professional experience of personnel, capital contribution capabilities, company financial status, and the stability of equity and the senior management team. Mr. Jia then provided a detailed presentation with specific case examples.
The afternoon session began with Llinks partner and head of the Intellectual Property department, Ms. Cherri Che, who presented on 'Building the Moat for Financial Data. A Private Fund Institution's Battle for Trade Secrets." Ms. Che's presentation covered the risk landscape of private fund core assets, the civil, criminal, and administrative penalties that can arise from crossing legal red lines, and how to build a defense system. Ms. Che used a wealth of practical cases and real-world experience to help attendees draw parallels and understand the importance of trade secrets, as well as the key points to note in daily work. Ms. Che mentioned that special attention should be paid to ongoing employee training, raising security awareness, and managing access permissions. She stated that a moat is not a wall, but a continuously evolving immune system.
Next, Llinks partner Mr. Patrick Gu gave a presentation titled "Discussion on Hot Issues in Labor and Personnel Compliance for Private Fund Managers." Mr. Gu focused on the common disputes over deferred bonuses and the widely debated issue of non-compete clauses in quantitative fund institutions. Mr. Gu specifically noted that bonus deferral is not only for compliance, but can also restrain individuals from being held accountable in cases of disputes arising from net asset value fluctuations. He mentioned that the clawback system for deferred bonuses has been in place at financial institutions for many years and is a valuable model for private fund managers to reference. Regarding non-compete clauses, Mr. Gu suggested that companies should ensure the non-compete obligations are consistent with the scope of the employee's confidentiality responsibilities, to avoid a one-size-fits-all approach. For employees who have signed non-compete agreements during their employment, both active fund managers and new hires should carefully comply with the terms. Any breach will result in liability for breach of contract.
The final speaker was Llinks contractual partner Ms. Yan Tao, who has over ten years of deep practical experience in the private securities fund field. Drawing from her experience in assisting managers with internal control and self-inspection, Ms. Tao focused on the system construction for investment, research, and trading behavior of private securities fund managers and the establishment of an authorization framework. She also shared recommendations for quantitative managers to implement the new regulations. Ms. Tao stated that the daily process management of investment, research, and trading needs to be implemented meticulously, with each step having verifiable records and data to ensure genuine fair trading. The fiduciary duty of diligence is not just for show; it is about demonstrating fairness at every stage when conflicts of interest arise, and ensuring that investors' interests are prioritized. This is something everyone should consider to solve problems at the source, so that implementation does not easily deviate from the original intent.
The workshop provided a platform for attendees to exchange and learn, promoting the sharing of management experience and information exchange in the field of securities private fund compliance and risk control. Looking ahead, Llinks will continue to work with industry institutions to focus on trends in securities private fund compliance and provide professional support to corporate partners across various industries in the field of securities private fund compliance management.
