Multiple private equity firms have received notices to temporarily suspend the addition of cross-border TRS.

Several private equity professionals revealed to reporters last night that they had received notifications from their partner brokerage firms, indicating that regulatory requirements had been issued to temporarily halt the increase in cross-border Total Return Swap (TRS) size. According to public information, TRS involves signing income swap agreements with counterpart brokerage firms under the premise of Total Return Swap to obtain the returns of the assets. Since the beginning of this year, due to the outstanding performance of the global technology sector, many private equity firms have been using cross-border TRS to allocate overseas assets. Since May, the China Securities Regulatory Commission and eight other departments jointly issued the "Implementation Plan for Comprehensive Rectification of Illegal Cross-Border Securities and Futures Fund Management Activities", taking a tough stance on top cross-border internet brokerage firms such as Tiger Brokers, Futu Holdings, and Changqiao Securities. After the space for mainland residents to illegally trade stocks across borders narrowed, private equity products using cross-border TRS to allocate overseas technology targets have attracted more attention from investors. Several private equity professionals disclosed, "The relevant notification was quite sudden, and some product strategies may undergo certain changes in the short term. We are currently waiting for further clarification on the regulation of cross-border TRS quotas."