Crowdfunding

Recent Articles

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  06/05/2021

  A look of disapproval: the FCA’s new discussion paper on financial promotions rules for high-risk investments and firms approving financial promotions

  On 29 April 2021, the Financial Conduct Authority (“FCA”) published a Discussion Paper DP21/1 concerning the proposed strengthening of the financial promotion rules for high-risk investments and firms approving financial promotions (the “Discussion Paper”). The Discussion Paper relates to: the FCA’s classification of high-risk investments; further segmentation of the high-risk investments market; and the role of an authorised firm that approves a financial promotion. 1. Classification of high-risk investments Background At present, the FCA rules relating to financial...

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  11/12/2020

  FCA confirms final rules for ban on marketing of speculative illiquid securities, such as “mini-bonds” to retail investors

  The FCA yesterday published its final rules on the marketing of speculative mini-bonds to retail investors, which will apply from 1 January 2021. This follows the FCA’s introduction of temporary rules banning the marketing of these instruments to retail investors on 1 January 2020, and a subsequent consultation relating to the proposed final rules. In summary, the final rules: allow the marketing of speculative illiquid securities to retail investors only when they are classified as: certified sophisticated investors, or certified high-net worth investors and self-certified sophisticated...

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  03/11/2020

  Busy Times in FinTech: Outline of Recent Regulatory Developments - Part 2

  In this article, the second in the series, we continue to look at recent regulatory developments impacting the FinTech industry. Our first article looked at the UK Financial Conduct Authority’s (FCA) ban on the marketing and distribution of crypto-derivatives to retail investors and its latest sandbox schemes. Here, we discuss developments in the EU and the Financial Stability Board’s (FSB) proposal for the regulation of global stablecoin arrangements. New EU-wide rules for crowdfunding platforms On 5 October 2020, the European Parliament adopted a new crowdfunding Regulation which...

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  18/06/2020

  FCA proposes permanent ban on marketing mini bonds

  On 18 June 2020, the FCA has released a new consultation paper CP20/8 on High-risk investments: Marketing speculative illiquid securities (including speculative mini-bonds) to retail investors (the “Consultation Paper”). In summary, the Consultation Paper proposes to: Extend the current ban on the marketing of speculative illiquid securities (“SISs”) (including speculative mini-bonds); and Amend and clarify the temporary product intervention rules relating to SISs, including by expanding its scope to include certain types of listed bonds. Permanent ban on marketing SISs...

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  26/11/2019

  FCA bans marketing of speculative mini-bonds to retail investors

  Today the FCA introduced temporary rules banning the marketing of speculative mini-bonds to retail investors. The rules will apply from 1 January 2020 for a period of 12 months, expiring on 31 December 2020. In line with the FCA’s ongoing efforts to prevent consumer harm, in summary it has implemented the following temporary rules designed to strengthen its requirements on financial promotions: Restricting the marketing of speculative illiquid securities to sophisticated or high-net worth retail investors only and where the product has been pre-assessed as likely to be suitable for them;...

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  19/08/2019

  Online Platforms: "Walking" the line between legal and financial services compliance ( Part 5 of 5)

  The AML requirements set out under the MLRs create a number of obligations which would apply to regulated online platforms including:creating internal policies and procedures;carrying out internal risk assessments;creating a system for suspicious activity reporting;training staff;carrying out customer due diligence (“CDD”), enhanced due diligence (“EDD”), or simplified due diligence where necessary; andrecord keeping.Online platforms commonly implement some of the following measures to meet AML obligations:filtering customers to avoid “high risk” customers or...

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