Will the Proposed European Crowdfunding Regulation Lead to a ‘True’ European Market for Crowdfunding?

Abstract

On 8 March 2018, the European Commission published a proposal for a crowdfunding regulation (hereafter: ‘CFR’) as well as a proposal to amend MiFID II . The CFR proposal seeks to facilitate the scaling up of crowdfunding services across the internal market to increase access to finance for entrepreneurs, start-ups, scale-ups and SMEs in general. Till now, crowdfunding services have not been subject to EU action. Crowdfunding service providers (hereafter: ‘CSP’) were therefore subject to the different national frameworks implementing existing EU law that hindered the emergence of an European market for crowdfunding. The EU regime seeks to introduce a level playing field for these service providers provided that these providers comply with harmonized EU legislation. This contribution seeks to assess whether and to what extent the CFR proposal will lead to a ‘true’ European market for (investment- and lending-based) crowdfunding. To that end, this contribution evaluates several relevant aspects of the CFR, including its scope, ‘platform’, sales and marketing regulation that target CSPs.