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European Crowdfunding Network

ECN

The European Crowdfunding Network AISBL (ECN) is a professional network promoting adequate transparency, (self) regulation and governance while offering a combined voice in policy discussion and public opinion building.

Lobbying Activity

Response to Legislative proposal for an EU framework on crowd and peer to peer finance

22 Mar 2018

The European Crowdfunding Network (ECN) welcomes and strongly supports the initiative to implement a unified European wide regulatory framework for Crowdfunding Services Providers for Businesses. The proposed text would surely be welcome by many start-ups and SMEs, investors and platforms as a way to boost capital formation and investment opportunity across Europe. We find the proposal a relevant and detailed reflection of the problems the crowdfunding market is facing in Europe, as has been highlighted over the past five years by relevant research from independent organisations and ECN. We find the proposal balanced and specific in its current form and have identified many aspects that we believe are well designed to ensure transparency, customer protection and platform operations. Some aspects of the current proposal could, however, adversely impact the development of alternative financing and therefore be contrary to the stated objectives. We therefore would like to offer a set of recommendations for modification or clarification that we believe would align the proposal with its stated goals even more. Given that the ECN’s members comprise of both loan and investment (the latter representing both equity and debt) based platforms, we sought input from representatives of each type of platform. We also reached out to relevant platforms that are not members of our network and involved also those in developing our opinion. As the proposal addresses quite different business models and financial structures used, we have structured the propositions in three sections for clarity: 1. Common Propositions, 2. Loan-specific Propositions and 3. Investment-specific Propositions. We comment below on the key aspects, which we believe would benefit from modification and/or clarification.
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