On July 8, 2016, the FCA launched a call for input into its review of the implementation of its crowdfunding rules. The FCA implemented rules regulating FCA-authorized firms operating crowdfunding services on April 1, 2014 and committed to reviewing these rules in 2016. The FCA is seeking views on changes in the market since the rules were implemented, emerging risks for consumers, and areas where the FCA might consider adapting its rules.

In particular, for loan-based crowdfunding, the FCA is considering whether the standards for financial promotions, due diligence and prudential regulation are appropriate, whether firms should be required to disclose more detail to consumers, and whether firms should be required to assess investor knowledge and experience of the relevant risks. For investment-based crowdfunding, the FCA would like views on how conflicts are managed by operators of the platforms, whether due diligence requirements need to be strengthened, and whether to mandate the disclosure of risk warnings for non-readily realizable securities held within Innovative Finance ISAs. Responses were due by September 8, 2016. The FCA will consider the information it receives in response to the call for input as well as during other areas of the review and decide whether it is appropriate to consult on proposed rule amendments.

The call for input is available at: https://www.fca.org.uk/publication/call-for-input/call-input-crowdfunding-rules.pdf