Development of Regulation (EU) 2020/1503, its effect on the multi-business model crowdfunding service providers and new niches of business

Abstract

Crowdfunding as part of modern day’s finance and category of fintech has developed rapidly in the last decade leaving regulation behind. Problems arising from insufficient regulatory framework and fragmented national approach have led to encumbered cross - border activity and a variety of risks for retail investors due to lack of information or misleadingly presented information, which is sought to be solved by newly imposed pan-European Regulation for crowdfunding. This thesis aims to clearly understand, what kind of authorisation will be necessary for multi-business model crowdfunding platforms and new industry niches introduced by regulation, which will be tried to be achieved through following objectives: Firstly, determination of the origins of the crowdfunding and correctly classify the crowdfunding services based on its business models. Secondly, Research the development of crowdfunding regulation, starting from the national level regulatory framework, following with reasoning and roadmap of European level regulation development. Thridly, analyseing the legislative text of the regulation, in order to determine its scope and therefore effect, as well as possible shortcomings and opportunities arising from it and finally by finding the requirements for authorisation and operation for multi-business model crowdfunding platforms and newly established niches of industry.