The new rules allow Japan crowdfunding intermediaries that conduct public offerings or private placements through the internet only within certain limits, to register as a Type I Intermediary if equity interests are offered directly or as a Type II Intermediary if fund interests are offered. Subscription amount limits will be determined by FSA regulations, but the total subscription amount is less than JPY 100 million and subscription amount per investor is JPY 500 thousand or less.
The new rules exempt Japan crowdfunding intermediaries from restrictions that target other financial operators, including:
exempt Type I Crowdfunding Intermediaries from restrictions on conducting other types of business and regulation of capital to risk ratios applicable to regular Type I Intermediaries;
lower the required capital for Type I Crowdfunding Intermediaries to JPY 10 million from the current JPY 50 million which applies to regular Type I Intermediaries); and
lower financial requirements for Type II Japan Crowdfunding Intermediaries to JPY 5 million from JPY 10 million which applies to regular Type II Intermediaries.
Also, the JSDA has be lifted prohibitions on handling public offerings or private placements of unlisted securities to the extent such transactions meet the requirements for crowdfunding as described above.
To prevent fraud activities, certain restrictions will apply to registered Japan crowdfunding intermediaries, including:
requirement to provide disclosures about the crowdfunding intermediaries and the investment companies, and a requirement to provide internet access to most information required to be delivered prior to the execution of the contract to subscribe for stock or fund interest; and
compliance with duties of good faith, advertising rules, and other restrictions generally applicable to regular Type I/Type II Intermediaries.
Review the current Japan Crowdfunding discussion:
Here are just a few features for Japan crowdfunding included in the CrowdForce platform software:
• Currency options include $, £, € with more custom options available
• Localization and language packs available
• Complete and simple document signing and management
• Easy offline payments, custom payment solutions available
• Plug in your local escrow account
• Plug in your broker services for accredited investments
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