After a delay due to the 2016 election, the Corporations Amendment (Crowd-sourced Funding) Bill 2016 has been passed by Parliament.
UPDATE: Royal Assent given on 28 March 2017.
The Bill amends the Corporations Act 2001 (Cth) to:
- establish a framework to facilitate crowd-sourced equity funding offers by small unlisted public companies; and
- provide new public companies that are eligible to crowd fund with temporary relief from reporting and
corporate governance requirements that would usually apply.
The amendments to the Corporations Act allow unlisted public companies with less than $5 million in assets and turnover to raise $5 million in funds from the ‘crowd’ over a year. The Bill does not apply to proprietary limited companies
A fundraiser intermediary has an obligation to prominently display on the platform the CSF risk warning, information on cooling-off rights, and fees charged to and interests in an issuer company.
Retail investors will have a 48 hour cooling-off right.
The Bill will commence on a day to be fixed by Proclamation or six months after Royal Assent, whichever occurs first.
