Year: at the first session of the 9th CPPCC National Committee held in 1998

Proposal No: 0001

Proposer: The Central Committee of the China National Democratic Construction Association

Abstract: 

1. Policies should define venture capital as a way to promote technological and economic development, especially in high-tech industries. 

2. All efforts should be taken to train talents in finance, insurance, corporate management, technology and economics, as well as those capable of predicting, solving and taking risks. 

3. Founding of venture capital firms should be encouraged and supported. 

4. Macroscopic adjustment should be enhanced, as well as incentives, such as those involving capital injection, tax exemption, credit and loans, and risk compensation. Regulations on establishment, administration authority, investment, operation and transfer of risk of venture capital companies should also be formulated. 

5. Publicity about venture capital should be enhanced, to help the public know about it and its economic and social benefit. Venture capital features high risk and high return. The high rate of return will attract capital to high-tech industries. 

6. Insurance companies are major participants in venture capital. More methods should be taken to encourage insurers to develop related business, either by providing guarantees for venture capital, or doing it themselves. 

7. A small part of pensions, insurance and other long-term capital should be allowed to invest in venture capital companies. Venture capital companies should be allowed to issue bonds and introduce foreign capital. 

8. Regulations on venture capital should be formulated as soon as possible, to provide legal guidance for venture capital companies, and ensure their rights in fund-raising, projects' selection, intellectual property protection and transfer of owner's equity. A venture capital law should also be implemented after trials and experience.