A.S.F. authorizes the first crowdfunding platform in Romania

Bucharest, 7 November 2022 – The Financial Supervisory Authority (ASF) announces the authorization of the first crowdfunding platform in Romania, SeedBlink. Thus, Seedblink Crowd S.A., which manages this platform, is the first company authorised by ASF as a provider of crowdfunding services, shortly after the entry into force in August 2022 of Law no. 244/2022 regulating this field.

The company is authorised to provide the following equity crowdfunding services:

  • the placement without a firm commitment of securities and instruments admitted for equity crowdfunding purposes and the receipt and transmission of orders in relation to those securities and instruments admitted;
  • the use of special purpose vehicles for the provision of equity crowdfunding services;
  • operation of a bulletin board.

“This event represents the completion of a first collaboration between ASF, as the legally competent institution at national level in the field of equity crowdfunding, and the entities applying for authorization as a provider of such services, while reflecting the Authority’s continued involvement in this pioneering field for the local capital market. This involvement was manifested early on, being materialised both in the technical participation in the creation of the national legal framework represented by Law no. 244/2022, and throughout the entire process of legislative endorsement and promotion, which preceded the adoption and entry into force of this law”, underlines Mr. Ovidiu Petru, General Director - Financial Instruments and Investments Sector of ASF.

With the emergence of these new authorized entities, the capital market diversifies its financing offer to small and medium-sized companies and stimulates innovative entrepreneurship in Romania by accelerating the efficient allocation of financial resources. This creates the conditions for attracting new categories of investors and implementing a new business model for companies, as well as a new financing alternative for eligible companies.

Equity crowdfunding is a financial technology solution that provides small and medium-sized enterprises (SMEs), especially start-ups and expanding companies, with an alternative financing tool to banking, i.e. by connecting potential investors or lenders with the business environment seeking finance through equity crowdfunding providers. Such financing is achieved through loans and the purchase of securities or other instruments eligible for equity crowdfunding.

The operation of the crowdfunding activity involves three main participants: the project developer which proposes the project for funding, the investors which finance the proposed project and a crowdfunding service provider which is the “interface” facilitating the connection between project developers and potential investors by managing an online platform.

ASF points out that, although the crowdfunding activity benefits from a complex and specific regulatory framework (having both a European dimension, through the direct applicability of Regulation (EU) no. 2020/1.503, and a national dimension through the provisions of Law no. 244/2022), it still entails a number of specific risks for investors, given that they do not benefit from the protection offered by clearing funds.    

In this context, we reiterate that the Financial Supervisory Authority, as the competent authority in Romania to carry out the functions and tasks laid down in Regulation (EU) no. 2020/1.503, remains permanently open to a pragmatic and constructive technical dialogue, both with the entities that wish to obtain the status of providers of equity crowdfunding services or have obtained this status, and with the investors which are beneficiaries of these services, in order to fulfil its legal role and duties in the field of authorisation and supervision of the conduct of activities and operations specific to equity crowdfunding and to ensure a stable and transparent institutional framework for debating the issues, particularities and challenges of a practical nature specific to this field.