Crowdfunding
What Is the Status of Permissions for Crowdfunding Platforms in Europe?
ECSPR will also encourage international (or non-European) platforms to join the EU. Wefunder, one of the largest Reg CF funding portals in the U.S., recently chose the Netherlands to obtain permission to provide securities crowdfunding services in the EU. While Seedrs, a major UK platform active in Europe, was acquired by Republic in 2021.
As of November 2021, pan-European crowdfunding rules became enforceable after approval by the European Union in 2020. Under the new rules, or European Crowdfunding Service Providers Regulation (ECSPR), a platform can raise up to €5 million from investors in all member states, thus opening the crowdfunding to investment for more than 300 million EU citizens.
Under the new rules, a securities crowdfunding provider must be approved by the competent authority in the country where it is based. Some countries have moved more quickly to process the ECSPR approval process while others have moved more slowly, leading to some discrepancies between regulators. A disparity between countries has led the EU to delay full compliance until November 2023 (originally scheduled for last November).
Born2Invest mobile application is bringing all the crowdfunding and business news from trusted sources to a single screen so you can stay on top of the market. The application is aggregating the most important and breaking news from relevant websites, the list is always revised and updated with new resources.
The current state of licensing in Europe
Crowdcube, a leading British equity crowdfunding platform, had established an office in Spain years ago, and was the first issuer to be authorized and raise capital under the new European rules. In the following months, however, other platforms received approval from regulators in their respective states.
In ESMA’s intentions, harmonization should generate more competition and consolidation in the industry. In this regard, Invesdor, a Finnish platform, has moved quickly to merge with other platforms.
ECSPR will also encourage international (or non-European) platforms to join the EU. Wefunder, one of the largest Reg CF funding portals in the U.S., recently chose the Netherlands to obtain permission to provide securities crowdfunding services in the EU. While Seedrs, a major UK platform active in Europe, was acquired by Republic in 2021.
In Italy, the authorization process has not yet begun as the formal appointment of Consob and Banca d’Italia as the competent authority for Italy is still lacking. However, it seems assoadto that the situation will unblock in the second half of February.
A list of current platforms approved to date under the EU regulation is available. Some of them are focused on debt, while others are vertical and geared toward real estate or renewable energy. Some of them plan to offer secondary transactions through a bulletin board-type service, the only secondary market mode allowed under the regulation.
__
(Featured image by succo via Pixabay)
DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.
This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.
First published in Crowdfunding buzz, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Born2Invest assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Born2Invest is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.
-
Impact Investing2 weeks ago
ESG Ratings Are Crucial for Private Investors’ Decision-making, Study Shows
-
Business1 day ago
Breaking Records with a Big Fat Zero: How the Dow Jones’ Highs Register as 0.0% in the BEV Plot
-
Markets2 weeks ago
U.S. Leads G7 Economic Growth, But Can It Stay Ahead Amid Global Uncertainty?
-
Africa7 days ago
Why It Is So Difficult to Build Mining Refineries in Africa