On 27 October 2016, the Belgian Financial Services and Markets Authority (FSMA) released its amended communication on public offers that are exempted from the obligation to publish a prospectus. Providers who wish to publicly offer a crowdfunding type of investment can also benefit from the statutory prospectus exemption.
Statutory prospectus exemption for crowdfunding
The applicable legal framework is the Act of 16 June 2006 on public offers of investment instruments and admissions of investment instruments to trading on regulated markets (the Prospectus Act). The Prospectus Act was modified by the Act of 25 April 2014, which introduced a new statutory prospectus exemption to ease the legal obligations covering crowdfunding.
To benefit from the prospectus exemption, the applicant has to comply with a strict procedure with respect to the FSMA. To facilitate the process, the FSMA has now updated its communication to include the crowdfunding exemption and to provide a comprehensive explanation of the various steps of the procedure.
In addition to the mandatory completion of the administrative procedure, the substantive requirements that need to be met for the prospectus exemption to apply are:
- a maximum of EUR 1,000 can be pledged by the investor on the offering;
- the total counter value of the offer must be less than EUR 300,000;
- every document has to mention the total counter value and the maximum investment possible per investor.
However, with regard to the above substantive requirements, we refer to the draft law of 5 October 2016 on various provisions (the Bill), which intends to not only create a specific regime for crowdfunding, called the ‘alternative-financing platform’ (alternatieve-financieringsplatform/plateforme de financement alternatif) (article 2 of the Bill), but also to increase the maximum amount that can be invested from EUR 1,000 to EUR 5,000 (article 41 of the Bill).
Please find a link to the updated communication and the Bill below.