Facilitating Equity Crowdfunding in the ASEAN Region

Abstract

Equity crowdfunding (ECF) is quickly emerging as an important mechanism to help bridge a major funding gap for small businesses. ECF provides an opportunity for these businesses to leverage technological advances that provide access to funds from a wider range of potential investors, including those retail investors who may previously not have participated in investing. This report on ECF was prepared for the Association of Southeast Asian Nations (ASEAN). The objectives of the report are to provide information and recommendations for member states in ASEAN which have not yet introduced ECF on the key issues they should consider in designing a regulatory framework for ECF; and for those ASEAN member states which have introduced a regulatory framework for ECF, provide information on developments in the regulation of ECF in other jurisdictions.

This report:

(1) defines ECF;

(2) compares ECF to other forms of crowdfunding;

(3) outlines the roles of the main participants in the ECF process (issuers, investors, and platform operators);

(4) discusses the economic background to ECF including the main justifications for the introduction of ECF into ASEAN;

(5) identifies the benefits and risks associated with ECF; and

(6) provides detailed analysis of ECF in four jurisdictions – two ASEAN member states (Malaysia and Thailand) and two jurisdictions which are not members of ASEAN (the United Kingdom and Australia) together with briefer discussion of developments in ECF regulation in the United States, New Zealand, Canada, China, Hong Kong, and Singapore.

This analysis of how ECF is regulated in a number of jurisdictions leads to a series of recommendations regarding the key issues that should be considered in designing a regulatory framework for ECF.

Note: Association of Southeast Asian Nations (ASEAN) to acknowledge that the soft publication is taken from ASEAN Secretariat Website.

Keywords: equity crowdfunding; crowdfunding; capital raising; Association of Southeast Asian Nations