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ASIC has released guidance for public companies and crowd-funding platform operators a week before the new crowd-sourced funding (CSF) regime kicks off.
The new CSF regime, which will commence on 29 September 2017, will allow small unlisted public companies with less than $25 million in annual turnover and assets to source and raise funds on crowdfunding sites to the tune of $5 million a year.
The industry regulator has released Regulatory Guide 261 Crowd-sourced funding: Guide for public companies (RG 261) to help companies seeking to raise funds through CSF to understand and comply with their obligations, including determining if their company is eligible and how to prepare the CSF offer document.
Regulatory Guide 262 Crowd-sourced funding: Guide for intermediaries (RG 262) has also been released to assist crowd funding platform operators or intermediaries to understand their ongoing obligations as AFS licensees and the specific obligations that apply under the CSF regime in the Corporations Act.
In a statement, ASIC said it had also published a template CSF offer document to help companies prepare their CSF offers, “particularly as many of these companies will not have experience in making public offers of their shares”.
“Crowd-sourced funding provides an opportunity for small to medium-sized businesses to access an alternate source of capital without the regulatory burden of traditional fundraising,” ASIC commissioner John Price said.
“ASIC's new guidance will help public companies and crowd-funding platform operators comply with their obligations under the CSF regime, while supporting investor confidence.”
The Institute of Public Accountants has previously thrown its support for the new CFS regime, with chief executive Andrew Conway saying that the proposed amendments would help bridge the “capital gap” faced by many young and emerging start-ups.
“Australia has a relatively poor global record of commercialising innovation and lags behind most advanced economies on this matter, so addressing the lack of funding for start-ups is critical,” Mr Conway said.
“It is these innovative firms that drive economic transformation, and which are much needed to respond to a dynamic, global environment.”