On May 13, 2016, the SEC issued new Compliance and Disclosure Interpretations (“C&DIs”) on Rules 100 (Crowdfunding Exemption and Requirements), 201 (Disclosure Requirements), 204 (Advertising) and 205 (Promoter Compensation) of Regulation Crowdfunding.
The SEC’s crowdfunding rules (under Regulation Crowdfunding) became effective earlier this week.
Ever since the Federal securities laws were enacted in 1933, all offers and sales of securities in the United had to either be registered with the SEC or satisfy an exemption from registration.
The SEC’s equity crowdfunding rules finally go into effect this month almost four years after Congress passed the JOBS Act, requiring the relaxing of certain rules on raising funds.
Beginning on May 16, issuers for the first time will be able to offer and sell securities online to anyone, not just accredited investors, without registering with the SEC.
Raising capital in the real estate context, whether through large-scale investment or by smaller, more focused means, can be an intricate, time-consuming and expensive process.
Nonprofits engaged in fundraising from the general public have been “crowdfunding” for centuries!
On 22 February 2016, the Netherlands Authority for the Financial Markets (Autoriteit Financiële Markten, the AFM) announced that it will maintain the €500 threshold for the initial ‘crowdfunding investment test’ (crowdfunding investeerderstoets), which will apply to investors investing through crowdfunding platforms.
With the May 2016 effective date of the new crowdfunding rules approaching, the SEC is attempting to help prepare the market.
Crowdfunding has officially been launched in Ontario as of January 28, 2016, enabling Canadian businesses to raise capital at a low cost by reaching out to a large number of investors over the Internet.