The Corporations Amendment (Crowd-sourced Funding) Bill 2016 was passed today, with 35 senators voting in favour of the legislation and 30 against.
The bill makes an amendment to the Corporations Act to “establish a framework to facilitate crowdsourced funding offers by small unlisted public companies; provide new public companies that are eligible to crowdfund with temporary relief from certain reporting and corporate governance requirements”.
The amendment will also “enable the minister to provide that certain financial market and clearing and settlement facility operators are exempt from specified parts of the Australian market licence and clearing and settlement facility licencing regimes”.
Lobby group FinTech Australia said it welcomed the newly-passed legislation, which it said would “provide a major new avenue to allow companies to grow and create jobs”.
“This new legislation represents an important step to open up early-stage capital markets, which will ultimately help businesses to grow and therefore create new employment opportunities,” said FinTech Australia chief executive Danielle Szetho.
“It also represents a substantial step forward in making the Australian regulatory environment internationally competitive, given concerns that Australia is falling behind the rest of the world when it comes to equity crowdfunding.”
Crowdfunding fintech Equitise said there will be “huge demand” for equity crowdfunding in the market now the bill has passed, with the company’s co-founder Jonny Wilkinson noting this funding method had already garnered support within the New Zealand market.
“We've been approached by hundreds of companies over the past two years that we were unable to help, and we're looking forward to working with all the suitable companies to use equity crowdfunding to harness the crowd,” he said.
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