The Australian Treasury has today, 4 August 2015, released a consultation paper providing the first details of the impending legislative framework for crowd-sourced equity funding (CSEF) for public companies. The introduction of a legislative framework for CSEF’s is part of the 2015-16 federal budget package.
The consultation paper outlines some of the key provisions that will apply to companies participating in CSEF’s, these include:
- the availability of CSEF is restricted to Australian public companies that qualify as small enterprises who are yet to raise funds through a previous public offer;
- a number of exemptions from certain public company compliance costs for newly registered or converted public companies;
- a maximum of five (5) million dollars in a twelve (12) month period can be raised through CSEF;
- a limit of one class of fully paid ordinary shares per round of CSEF with equal price, terms and conditions; and
- a tailored disclosure package that applies specifically to CSEF.
Further details will be forthcoming in the draft legislation to be released later in the year. Presently the Australian Treasury is inviting comments from interested stakeholders until 31 August 2015. It is anticipated that the legislation will be introduced to Parliament in the Spring sittings.
Further information
If you need advice on your rights and obligations in light of the proposed crowd funding laws, contact us for a confidential and obligation-free discussion:
Malcolm Burrows B.Bus.,MBA.,LL.B.,LL.M.,MQLS.
Legal Practice Director
T: +61 7 3221 0013 (preferred)
M: +61 419 726 535
E: mburrows@dundaslawyers.com.au
Disclaimer
This article contains general commentary only. You should not rely on the commentary as legal advice. Specific legal advice should be obtained to ascertain how the law applies to your particular circumstances.
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