Crowdfunding platforms: obtaining and maintaining ECSP authorisation
Since 10 November 2023, every crowdfunding platform operating in the European Union must hold a European Crowdfunding Service Provider (ECSP) authorisation. The former French statutes – investment adviser (CIP) and participatory finance intermediary (IFP) – have been absorbed into this single regime under EU Regulation 2020/1503. Legal guidance through the new regulatory framework is essential.
The practical consequences are significant. In France, authorisation is granted by the AMF (the French financial markets authority) after binding opinion from the ACPR (the prudential supervisory authority). The application requires governance safeguards, minimum own-funds, conflict-of-interest management, and AML/CFT compliance. In practice, assembling the file takes two to four months; AMF review adds three to six months. Once authorised, the ECSP licence provides a passport to operate across all EU member states.
<!– wp:solent/article-code {"title": "EU Regulation 2020/1503 of 7 October 2020", "content": "The ECSP Regulation harmonises the legal framework for crowdfunding across the European Union. It requires the single ECSP status for any platform facilitating loans or the subscription of transferable securities, up to a limit of EUR 5 million per project over 12 months. Above that threshold, a prospectus is required. »} –>EU Regulation 2020/1503 of 7 October 2020
The ECSP Regulation harmonises the legal framework for crowdfunding across the European Union. It requires the single ECSP status for any platform facilitating loans or the subscription of transferable securities, up to a limit of EUR 5 million per project over 12 months. Above that threshold, a prospectus is required.
What we handle
- Compliance audit against the ECSP Regulation and the French Monetary and Financial Code
- Preparing and filing the ECSP authorisation application with the AMF
- Drafting regulatory documents: terms of service, conflict-of-interest policy, AML/CFT framework
- Drafting Key Investment Information Sheets (KIIS) in compliance with Article 23 of the Regulation
- Ongoing regulatory watch and adaptation to evolving EU and French requirements
- Defence before the AMF Sanctions Committee in disciplinary proceedings
ECSP authorisation timeline
Audit and status selection
File preparation
AMF filing
Review (3-6 months)
Authorisation and EU passport
Project promoters: structuring your crowdfunding campaign
You are launching a fundraise through a crowdfunding platform. Before publishing your campaign, several legal questions must be resolved: which form of funding to adopt, what information to provide to investors, how to structure the operation in compliance with French law and EU regulation. A lawyer intervenes upstream to secure each step.
The issues vary by crowdfunding type. In property crowdfunding, the promoter must plan the project vehicle structure, the guarantees offered to investors, and the treatment of directors’ personal guarantees. In crowdlending, the loan terms (rate, duration, security) must comply with regulatory caps. In equity crowdfunding, the shareholders’ agreement and exit clauses will govern the relationship with investors for years to come.
| Type | Mechanism | Required status | Regulator |
|---|---|---|---|
| Donation (with or without reward) | Contribution with no financial return | IFP | ACPR |
| Loan (crowdlending) | Interest-bearing or interest-free loan | ECSP or IFP | AMF / ACPR |
| Investment (equity / bonds) | Subscription of financial instruments | ECSP | AMF |
What we handle
- Advising on the appropriate form of crowdfunding for your project
- Structuring the operation (project vehicle, shareholders’ agreement, issuance terms)
- Reviewing the financial and legal information provided to contributors
- Drafting and negotiating agreements with the platform
- Post-campaign assistance: repayment management, investor reporting, handling difficulties
Investors: defending your rights when things go wrong
You invested through a crowdfunding platform and the project has failed. The property developer is not repaying at maturity. The company in which you subscribed shares has entered judicial liquidation. The platform has disappeared or gone silent. These situations are increasingly common in the French property crowdfunding market, where several major defaults have occurred since 2023.
Your remedies depend on the nature of the breach. If the platform failed in its information duties – incomplete Key Investment Information Sheet, understated risks, inadequate due diligence on the project promoter – its civil liability may be engaged. If the project promoter provided misleading information, the legal basis for the claim differs. In every case, speed is critical: some limitation periods are short, and the defaulting debtor’s assets diminish rapidly.
<!– wp:solent/article-code {"title": "Protection of the non-sophisticated investor", "content": "The ECSP Regulation requires platforms to administer a knowledge test before any investment and to grant a 4-day reflection period during which the non-sophisticated investor may withdraw without charge (Articles 21 and 22 of EU Regulation 2020/1503). Non-compliance gives rise to a right to compensation. »} –>Protection of the non-sophisticated investor
The ECSP Regulation requires platforms to administer a knowledge test before any investment and to grant a 4-day reflection period during which the non-sophisticated investor may withdraw without charge (Articles 21 and 22 of EU Regulation 2020/1503). Non-compliance gives rise to a right to compensation.
What we handle
- Analysing your situation and identifying liable parties (platform, project promoter, director-guarantors)
- Formal demand and pre-action negotiation
- Civil liability claim against the platform for breach of information and due diligence obligations
- Filing a proof of debt in the project promoter’s insolvency proceedings
- Reporting to the AMF and ACPR in cases of serious regulatory breach
Crowdfunding litigation: a rapidly developing field
Crowdfunding litigation is taking shape rapidly in France. Three main axes are emerging.
The first concerns platform liability. The central question is the platform’s role: neutral technical intermediary, or an actor exercising control over the offers presented? The Cour de cassation has recently clarified, in the context of digital platforms, that an operator who exercises influence over the content of offers cannot claim hosting-provider status and incurs standard liability. This reasoning is transposable to crowdfunding platforms that select projects and promote them.
The second axis involves criminal sanctions. Operating as a crowdfunding intermediary without authorisation is punishable under the same penalties as fraud (Article L. 573-15 of the Monetary and Financial Code). Prosecutions have multiplied since the end of the transitional period.
The third axis covers disputes between investors and project promoters, particularly in property crowdfunding: late repayments, interest defaults, enforcement against directors’ personal guarantees.
Our litigation services
- Platform liability claims before civil and commercial courts
- Defence before the AMF and ACPR Sanctions Committees
- Criminal proceedings as civil party in fraud or breach of trust cases
- Representing creditors in insolvency proceedings of defaulting project promoters
- Negotiating settlement agreements between investors and platforms
Frequently asked questions
What is the current regulatory framework for crowdfunding in France?
Since 10 November 2023, crowdfunding is governed by the EU ECSP Regulation (2020/1503). Every platform must obtain ECSP authorisation from the AMF. The former CIP and IFP statuses are being progressively replaced by this unified regime, applicable across the entire European Union.
What recourse is available if a property crowdfunding project defaults?
Several avenues exist. If the platform breached its information or due diligence obligations, a civil liability claim may be brought. If the promoter is in difficulty, you must file a proof of debt in the insolvency proceedings. The directors’ personal guarantees may also be enforced.
How long does it take to obtain ECSP authorisation?
File preparation typically takes two to four months. AMF review then takes three to six months, depending on the completeness of the initial submission. Total elapsed time is between five and ten months. Our firm guides you through each stage.
Do you handle urgent crowdfunding disputes?
Yes. Certain situations require immediate action, particularly where the defaulting project promoter’s assets risk being dissipated. Our lawyers can initiate protective measures and formal demands within very short timeframes.