Crowdfunding legislation for proprietary companies passes
The long anticipated extension of the crowd-sourced funding (CSF) regime is finally set to become a reality with the Corporations Amendment (Crowd-sourced Funding for Proprietary Companies) Bill 2017 having passed the Senate on 12 September 2018. Our previous thinking on this topic can be found here. We will be releasing part two of this article soon.
Under this legislation, proprietary companies with less than $25 million in assets and turnover will be able to raise up to $5 million in any 12-month period through crowd-funding platforms. Private companies who chose to raise funds through the CSF regime will be subject to a number of obligations which ordinarily only apply to public companies including a requirement to appoint an auditor once a fundraising threshold has been met and an obligation to comply with the related party transaction rules.
The Bill, as passed, will take effect 28 days after it receives Royal Assent, allowing proprietary companies access to the crowd-funding regime much sooner than had originally been anticipated.
Please contact us if you would like to discuss your fundraising options and strategy.
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