Crowd-Funding Sites Face Possible Regulation, EU’s Barnier Says
Originally posted in: Bloomberg
Michel Barnier, the European Union’s financial services chief, said he’s considering possible regulation of crowd funding, in a bid to protect users and stimulate the industry.
Barnier said the European Commission, the EU’s executive arm, is examining the need for a “single European framework” for crowd-financing services and will consult on possible measures until Dec. 31, according to a statement on its website today.
Crowd-financing services, such as Kickstarter Inc., manage Internet sites that allow entrepreneurs to appeal for funding for specific projects, and so to raise financing from a large number of individual contributors.
“The ultimate objective of this consultation is to gather data about the needs of market participants and to identify the areas in which there is a potential added value in EU action to encourage the growth of this new industry, either through facilitative, soft-law measures or legislative action,” the commission said.
Global regulators have cited the fledgling industry as “an important emerging innovation” that could present threats to market stability if left unregulated.
The International Organization of Securities Commissions, a group bringing together authorities from over 100 nations said last month it would “develop guidance” on the regulation of the industry.
To contact the reporter on this story: Jim Brunsden in Brussels at email@example.com
To contact the editor responsible for this story: Anthony Aarons at firstname.lastname@example.org