The Securities Commission Malaysia (SC) today published a consultation paper seeking public feedback on the proposed regulatory framework for equity crowdfunding (ECF).
ECF is a new form of fundraising that allows start-up or other smaller enterprises to obtain capital through small equity investments from relatively large numbers of investors, using online portals to publicise and facilitate such offers to crowd investors.
The SC considers alternative funding channels, such as ECF, a crucial and innovative market-based structure to facilitate growth of new small-scale enterprises, which contribute significantly to the national economy.
While ECF offers the potential to bridge capital gap for start-ups and small enterprises, it also carries certain financial risk for investors, just like any other investment products. It is hence important to provide a properly regulated framework to balance the growth of the ECF industry with achieving appropriate level of protection for investors.
The consultation paper in relation to the proposed ECF regulatory framework is available here at the SC website. Please submit your written comments to the address/email below by 5 September 2014.
Law Reform Department
Securities Commission Malaysia
3 Persiaran Bukit Kiara
50490 Kuala Lumpur
Fax: 603 – 6201 5101