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Spain becomes the fourth country to regulate crowdfunding law.


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BY : Diego GutiérrezOctober Fri, 2014
crowdfunding2The government approves the draft law on the Promotion of Business Financing, which includes a high level of regulation on crowdfunding. Among the new features of the law is the distinction between qualified and non-qualified investors.

crowdfunding for alternative financing of SMEs

Spain is not a country where the tradition of crowdfunding is widespread, however since the government announced that it was going to legislate crowdfunding activity, it has been a very important issue for the Spanish economy. crowdfunding Numerous international platforms have shown interest in the country.

The aim of many of these platforms is to succeed in presenting themselves as a way of achieving funding for SMEs, which fall off the credit radar of family and friends but which, because of their small size, are also unattractive for the risk capital.

"In Spain still the 78% of the funding The financial institutions do not lend, so the search for alternatives is much more complicated", says Diego Gutierrez of Abra Invest.

Qualified investors will have a free hand in terms of the amount of investment.

Following complaints from platforms dedicated to the crowdfundingThe government, which saw the investment limitation as an obstacle to the development of their activity, has rectified and removed the limits for "accredited investors".

Accredited investor" shall mean an investor who investors and companies exceeding certain levels of assets (one million euros), turnover (two million euros) or equity (300,000 euros) and all natural or legal persons whose income exceeds 50,000 euros per year or whose assets exceed 100,000 euros and who expressly request this treatment.

For non-professional investors, as stated in the preliminary draft, a limit of 3,000 euros per project and 6,000 euros per platform for a period of 12 months is established.

The limit on the amount of money that companies will be able to raise through crowdfundingThe new limit is reduced to €1M, as the government fears that extending this limit could lead to massive fraud among small investors, so for the time being they are inflexible.

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Spain crowdfunding: draft bill boosts crowdfunding activity

 We are currently preparing a report on the current state of crowdfunding as an alternative means of financing. If you are interested in receiving this report, leave us your email address and we will send it to you once it has been prepared.

 

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