ESMA Securities and Markets Stakeholders Group issues position paper
On 5th May ESMA (European Securities and Markets Authority) published a position paper on Crowdfunding.
Below are some of the clauses from the summary of the Securities and Markets Stakeholders groups’ position. There is some lobbying from the stakeholders, but ESMA can now be expected to put crowd funding on their agenda. To read the whole paper continue reading here
“In order to guarantee the technology neutral approach of regulation, however, the basic principles on crowfunding should be the same whether the call is made on-line or off-line (like through phone or direct marketing channels).
64.Among the many different types of CF currently out there, we consider that only those which offer something in return should be allowed as general norm for actual fundraising. In fact, ESMA should be concerned with pure securities-based crowdfunding, which represents a much smaller size than loan- based
65.However, given that both –loan based and securities based- raise similar concerns in terms of investors protection, we consider that ESMA approach towards crowdfunding should be coordinated with EBA in order to get a common position in terms of an appropriate equilibrium between impulse to crowdfunding and consumer protection.
69.It would be impossible and ineffective to make amendments to the current regulatory frameworks limiting crowdfunding (Prospectus, Transparency, MAD, etc.). But some kind of unified regulation should be targeted, without necessity to change member countries ́ regulation on IPO.
75.Regarding quantitative limits to maximum individual investments in crowdfunding, the working group considers that it is not to ESMA to make these choices. Nevertheless, in the MIFID context investment products should be appropriate to the investor ́s profile. To the extent that more leniency would be offered in crowdfunding investments, this should be balanced by some type of limits on maximum investor amount, either in absolute or relative terms.”