The European Crowdfunding Service Providers Regulation and the Future of Marketplace Lending and Investing in Europe: the ‘Crowdfunding Nature’ Dilemma (UPDATED JULY 2020)
Forthcoming in European Business Law Review 2021, 3
47 Pages Posted: 12 Aug 2020 Last revised: 14 Jan 2021
Date Written: July 30, 2020
The European Commission’s Proposal for a Regulation on European Crowdfunding Service Providers (ECSPs) for businesses, since its presentation, has faced difficult trilateral negotiations among the European Commission, the European Parliament and the Council of the European Union. The length of the legislative process can be explained not only by the insurgence of nationalisms, the uncertainty related to Brexit negotiations and the COVID-19 pandemic outbreak, but also because of the different views of the three European Institutions about crowdfunding and on how to regulate it. Nonetheless, they eventually reached an agreement in December 2019 and the Regulation is finally close to its formal adoption. The present paper, after briefly describing crowdfunding main features, will critically and analytically analyze the main aspects of the ECSPs Regulation, with respect to the approved text and to the pre-existing versions, evaluating the available alternatives, their pros and cons and proposing adjustments to reach a functional, tiered and proportional regulation and shed light on the nature and future of financial-return crowdfunding in Europe.
The present paper is an updated version of my previous one here: https://ssrn.com/abstract=3594353.
Keywords: Banking Regulation, Investment Services, Payment Services, Peer-To-Peer Lending, Crowdfunding, FinTech, MiFID II, Prospectus, Regulatory Arbitrage, European Crowdfunding Services Regulation, ICOs, Brexit, Bulletin Board, Secondary Markets, Prudential Requirements, Disclosure, Know-Your-Customer
JEL Classification: D18, E51, G21, G23, G24, G28, G29, G38, K12, K20, K22, K24, L14, L22, O16, O17
Suggested Citation: Suggested Citation