The European Securities and Markets Authority (ESMA) has issued another Q&A about the pan-European securities crowdfunding rules.
Updated rules addressing cross-border securities offerings or the European Crowdfunding Service Providers Regulation (ECSPR) went into effect across the entire European Union (EU) last November. But interested platforms must be approved by an individual country’s regulator or national competent authority (NCA) first and, as of yet, no offerings have been listed under the EU rules. The new rules are designed to enable an issuer to raise up to €5 million across all member states. This applies to both debt and equity securities offerings.
ESMA explains that the purpose of this Q&A is to “promote common supervisory approaches and practices in the application of the ECSPR.”
The document is being updated periodically and this most recent iteration includes items that fall under the investor protection category. These include:
- Language of the KIIS and KIIS at platform level (multiple)
- Languages accepted by NCAs
- Marketing of crowdfunding projects
- Cross-border Marketing
KIIS stands for Key investment information sheet – required documentation that is provided on the platform for a securities offering. According to the document, the KIIS must be presented in at least one language that is accepted by the NCA where the platform is authorized. Some EU members have multiple national languages. Thus, a platform or issuer may need to provide several translations.
One area that could create a minor hurdle is that CSPs [crowdfunding service providers] must adhere to national rules in regards to marketing meaning not the rules established in the member state where the platform is authorized nor a harmonized approach.
The Q&A is available below.