ESMA puts investor checks before crowdfunding membership fees

European crowdfunding platforms should complete categorisation, knowledge testing, loss-bearing assessment and related warnings before requiring a non-sophisticated investor to pay an access fee, ESMA said in a Q&A published on 16 October. The answer interprets the existing European Crowdfunding Service Providers Regulation; it does not introduce a separate licensing regime.[1]

Membership charges can coexist with public accessibility. ESMA expects objective, transparent access conditions and sufficient free information about available offers before payment. Platforms should explain the fee’s purpose, amount and frequency, including whether it buys access or represents an advance towards an investment.[1]

The warning that a paying member may find no suitable project is commercially consequential. So is disclosure of incentives where finfluencers promote access. Charging for admission brings the payment decision inside the investor-protection discussion, before a customer selects a particular project.[1]

For brokerage groups operating both investment services and crowdfunding, ESMA’s earlier Q&A of 23 September 2022 provides a related distinction. Information collected for MiFID assessments can be reused if it remains current. The crowdfunding knowledge test and loss simulation, and the applicable MiFID suitability or appropriateness assessment, must nevertheless each be completed. Additional questions can collect information missing from the earlier process.[2]

That distinction supports a practical approach to a shared customer journey. A platform can avoid repeatedly asking for the same current facts while retaining the separate assessment each service requires. An existing investment account is therefore useful input to onboarding, rather than evidence that the crowdfunding assessment has already been performed.[2]

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