Immigrating to Portugal focus on Portuguese economy: Keeping pace with the development of the crowdfunding industry, Portugal has recently introduced relevant new regulations. This Portuguese legislation is equivalent to the United States' JOBS Act. The newly introduced regulations define all crowdfunding activities (reward-based, loan-based, donation-based, and equity-based crowdfunding) and provide specific provisions for each type of activity.
The key points are as follows:
– There are no restrictions on ownership on the platform. Any individual or company can hold ownership, regardless of the business sector.
– Platforms may offer more than one type of crowdfunding activity. Participants must comply with the regulations for each specific type of crowdfunding activity separately.
– Platforms are strictly prohibited from disclosing user personal information.
– Platforms cannot provide investment recommendations and may not pay any form of sales commission to employees.
– Platforms cannot provide investment funds or hold securities. All securities must be provided directly by the company seeking funding.
– Loan-based and equity-based crowdfunding activities cannot be conducted simultaneously on multiple platforms.
– The total amount raised for reward-based and donation-based crowdfunding cannot exceed ten times the initial target.
– Before starting reward-based and donation-based crowdfunding, it is necessary to contact the Portuguese Consumer Protection Agency.
– Before starting loan-based and equity-based crowdfunding, it is necessary to contact CMVM (Comissão do Mercado de Valores Mobiliários). CMVM is equivalent to the Securities and Exchange Commission in Portugal.
– Regardless of the target, loan-based and equity-based crowdfunding must set a maximum fundraising limit.
– CMVM may set an annual maximum for equity crowdfunding fundraising or a maximum investment limit for investors.
The new regulations state more than once that situations giving rise to conflicts of interest require special attention. Platforms must make their best efforts to avoid conflicts of interest, which may arise if platform personnel participate in crowdfunding activities and consequently have a conflict with investors or fundraisers.