On 26 February 2021, the European Securities and Markets Authority (ESMA) issued a consultation document on draft technical standards on crowdfunding under the European crowdfunding service providers regulation (ECSPR). The ECSPR was published in the Official Journal of the European Union on 20 October 2020. The ECSPR requires ESMA to submit draft regulatory technical standards (RTS) and implementing technical standards (ITS) on a variety of topics.
The ECSPR requires ESMA to develop 8 draft RTSs, including 2 in close cooperation with the European Banking Authority (EBA), and 4 draft ITSs. The majority of these technical standards shall be submitted by ESMA to the European Commission (Commission) by 10 November 2021. The remaining 4 technical standards mandates (2 RTSs and 2 ITSs) must be delivered to the Commission by 10 May 2022. In addition to these 12 mandates to ESMA, the new regulation gives a mandate to EBA to develop 2 additional RTS (both in cooperation with ESMA).
ESMA is now consulting stakeholders on the proposals on 7 draft RTSs and 2 ITSs covering the following issues:
- Complaint handling.
- Conflicts of interest.
- Business continuity plan.
- Application for authorisation.
- Information to client on default rate of projects.
- Entry knowledge test and simulation of the ability to bear loss.
- Key investment information sheet.
- Reporting by crowdfunding service providers to Member State competent authorities (NCAs) (and NCAs to ESMA).
- Publication of national provisions concerning marketing requirements.
The deadline for responding to the consultation document is 28 May 2021.