EU Crowdfunding Regulation: The Authority Appointment in Italy still Missing

In a post on LinkedIn, lawyer Alessandro Lerro, president of AIEC (the association of equity crowdfunding platforms) and of the scientific committee of Assofintech, made an impassioned plea to urge Italian institutions to finally appoint the authority responsible for granting authorizations to operate according to the rules of the new European crowdfunding regulation. As a reminder, the compliance requirement will be triggered for all equity and lending crowdfunding platforms next November.

Lerro, in his post, said, “The SME sector that has found a significant outlet for sourcing finance in recent years (more than 3.5MLD in 2022 for various forms of crowdfunding) is in danger of finding itself without oxygen due to the forced blocking of activities. The burgeoning market of Italian #fintech operators is about to be colonized by foreign operators already with European authorization. Does it take that long to appoint the Competent Authority? Nothing more is needed, the rules are already there. We just need to decide who will issue the authorizations.”

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The risk to platforms

According to what Wired reports in an article by Luca Francescangeli, France and Spain are ahead of Italy in the transposition of the regulation, and this could lead to a scenario in which local operators will not only be able to get national authorizations on the right time but will also have the opportunity to apply for the one related to other European markets.

It could therefore happen that while Italian platforms, in the absence of European authorization, would not be able to operate either in Italy or abroad, those from other EU countries, duly authorized, would be able to collect in Italy as well, colonizing a national market that has remained untapped.

In the same article, Lerro added, “It is no coincidence that Esma, the European Authority that regulates finance and markets, recently suggested that the European Commission consider a change to the regulation, extending the transition period to all those platforms that will apply for authorization by October 1st, 2022.”

Appeal to policy

In the aforementioned post, Lerro again makes a heartfelt appeal to politics, arguing that the Regulatory Authorities themselves are also victims of this situation: “the market has been asking for a confrontation for months without getting concrete answers. In a climate of loyal cooperation for the overall growth of the market, with the Financial Authorities, we are always talking about empowering fintech operators, increasing the level of #competence, paying attention to compliance, investor education, defining thresholds of accountability, and the need for investments consistent with the role of financial intermediaries, despite the push for disintermediation of digital finance. The political responsibility is now there for all to see. It is time for politics to do its part. It is not difficult.”

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(Featured image by Michele Bitetto via Unsplash)

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