The European Commission has published amendments and supplemental legislation to the Regulation on European crowdfunding service providers for business ((EU) 2020/1503) (Crowdfunding Regulation) in the Official Journal of the EU. The Commission adopted the delegated and implementing regulations, which supplement and add to the Crowdfunding Regulation, on 13 July 2022.
The regulations provide guidance for crowdfunding service providers (CSPs) on the following issues:
- how CSPs can operate effective internal rules to prevent conflicts of interest;
- how CSPs should apply for authorisation and the process and timescale thereafter;
- information on the exchange of information between authorities in relation to investigation, supervision and enforcement activities in relation to CSPs for business;
- standard forms, templates and procedures for national marketing requirements of ESMA;
- how CSPs should implement technical standards regarding data standards and reporting information on projects funded through crowdfunding platforms;
- information on portfolio management of loans by CSPs, including the method to assess credit risk and policies required;
- complaint handling procedures;
- how CSPs can implement business continuity plans;
- methodology for calculating default rates of loans offered on crowdfunding platforms; and
- information on the regulatory technical standards specifying the entry knowledge the and the simulation of the ability to bear loss for potential non-sophisticated investors in the crowdfunding projects.