A long-awaited step in the world of the P2P Lending community is finally happening. The Crowdfunding regulation!
Very good news indeed. After several years of an unregulated P2P market, Europe finally decided to take a step forward and to adopt a regulation to all crowdfunding platforms.
The official news was published on the official website. There you also have access to the text of the crowdfunding directive and the text of the crowdfunding regulations. You can read both of them if you want to have a more detailed idea of how things are going to proceed from now on.
Not all crowdfunding platforms are covered
Please note that reward and donation-based crowdfunding are not part of this regulation’s scope since they cannot be assigned as financial services.
New rules and regulation
There will be different regulators depending on the size of the crowdfunding campaign. For larger operations, MiFID and the prospectus regulation will take the lead.
The new rules will give a higher level of investor protection to the non-sophisticated investor by demanding more transparency and giving clearer requirements.
The main goal is to increase the legal certainty through common investor protection rules.
The framework defines common authorisation and supervision rules for national competent authorities. The European Securities and Markets Authority (ESMA) will have an enhanced role to facilitate coordination and cooperation, through a binding dispute mediation mechanism and the development of technical standards.
What will be the impact in the near future?
I still don’t know how much impact it will have in the current operating platforms or future ones. Nor when these changes will occur.
There will surely be given time to all of the companies to adapt to these new standards.
Let’s hope for safer and more reliable investment days now that crowdfunding regulation has been implemented.
Stay tuned to School of Freedom for further updates!