[ESMA35-42-1088 ] Q&A on the European crowdfunding service providers for business Regulation

ESMA has published an updated version of its Q&A on the ECSPR (Regulation (EU) 2020/1503). In this latest version, several new Q&As were added relating to General provisions as set out in Section 3, provisions of crowdfunding services and organisational and operational requirements as set out in Section 4 and authorization issues as set out in Section 6 of the document.
We would like to present the new entries in full, quote:
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#### General provisions
Question 3.15: What should the starting day of the 12-month period referred to in point (c) of Article 1(2) of the ECSPR be?
Answer 3.15: The total consideration of offers by the same project owner referred to in point (i) and (ii) of point (c) of Article 1(2) of the ECSPR shall be calculated taking into account the total consideration of offers that have been made in the 12 months preceding the date of launch of the crowdfunding offer.
Question 3.16: Should the threshold referred to in point (c) of Article 1(2) of the ECSPR apply when a crowdfunding offer is made on several crowdfunding platforms?
Answer 3.16: Yes. The provision of point (c) of Article 1(2) applies irrespective of the fact that the crowdfunding offer is made on a single or several crowdfunding platforms.
#### Provisions of crowdfunding services and organisational and operational requirements
Question 4.2: Can a CSP provide services other than crowdfunding services (as defined in point (a) of Article 2(1) of the ECSPR)?
Answer 4.2: Yes. Pursuant to Article 12(13) of the ECSPR, a CSP “may also engage in activities other than those covered by the authorisation referred to in [Article 12] in accordance with the relevant applicable Union or national law”.
Consequently, the ECSPR does not restrict the possibility for a CSP to engage in other regulated activities requiring an authorisation under Union or national law, or unregulated activities complementary to the crowdfunding services. National or Union law may however restrict this possibility.
If these activities are covered by Union or national law, the CSP would need to comply, at all times, with those rules and, if applicable, seek the relevant authorisation(s) under Union or national law.
Engaging in those activities, covered by Union or national law, shall not impair CSP’s ability to operate as a neutral intermediary and to comply with the requirements set out in the ECSPR and notably Articles 3(2) and 8.
The distinction between crowdfunding services and other services/activities shall always be very clear to the client, including with regard to the regulatory framework applicable to such services or activities (or the lack of any such framework). Notably, in cases where those other activities are carried out by means of the same internet-based information system used to provide crowdfunding services, separate areas shall be clearly established on the website.
#### Authorisation and supervision of CSPs
Question 6.4: What type of changes to the information provided in the application for authorisation needs to be notified without undue delay to the authorising competent authority?
Answer 6.4: Article 15(3) of the ECSPR provides that any material changes to the information provided in the application for authorisation must be notified to the competent authority without undue delay.
Article 12(11) of the ECSPR provides that a CSP must meet at all times the conditions for its authorisation.
On this basis, CSPs are expected to notify, without undue delay, to their competent authority material changes to the information provided in the context of the authorisation process. This includes, but is not limited to, the information listed in points (a) to (r) of Article 12(2) of the ECSPR as well as any change in the shareholding of the CSP (i.e. in order to enable the competent authority to reconsider, if applicable, the assessment referred to in point (a) of Article 12(3) and 12(7) of the ECSPR).
CSPs are invited, as part of good supervisory practice, to discuss with their competent authority any material changes of key importance, such as, but not limited to, changes of the shareholding or changes of the persons in charge of management, prior to implementing such changes.
Question 6.5: Can a legal person be appointed to be responsible of the management of a CSP within the meaning of Article 12(2) of the ECSPR?
Answer 6.5: No. The ECSPR refers to persons in charge of the management of CSPs in various recitals and articles where this function is limited to natural persons.
Notably, for the purpose of the authorisation as CSP, Article 12(2) establishes that applicants shall provide the authorising NCA with:
• the identity of the natural persons responsible for the management of the prospective crowdfunding service provider (point (k) of Article 12(2)), and
• proof that the natural persons referred to in point (k) are of good repute and possess sufficient knowledge, skills and experience to manage the prospective crowdfunding service provider (point (l) of Article 12(2)).
The requirements are further detailed in Article 12(3) of the ECSPR and in Field 13 of the Annex to the Commission Delegated Regulation 2022/2112 on the requirements for authorisation as CSPs where the relevant provisions refer to the “natural persons” responsible for the management of the (prospective) CSP.