European Parliament approves crowdfunding rules

Brussels – The European Parliament adopted the latest text on cross-border crowdfunding rules agreed by the European Capital Markets Union (ECMU) in July. The new rules state that all crowdfunding platforms in the EU must be authorised by their member state and can then passport into other jurisdictions within the bloc.

There will be a €5mln limit on how much can be raised through platforms on each project over 12 months and firms will need to comply with anti-money laundering regulations and be transparent about returns and interested parties.

The rules say a limit should be set on how much non-sophisticated investors can invest and they will have to complete an appropriateness test to check they understand the risks. The development was backed by the European Crowdfunding Network.