In an attempt to push the National Innovation and Science Agenda of the Turnbull Government, Small Business Minister and Assistant Treasure Kelly O’Dwyer outlined the added benefits that the legislation will provide small businesses in their early stages.
“CSEF or crowdfunding is an emerging way for start-ups and early-stage businesses to access the funding and investors they need, while maintaining adequate protections for retail investors who share in the risk and successes of these businesses,” Ms O’Dwyer said.
Ms O’Dwyer outlined that as part of the legislation, unlisted public companies with less than $5 million in assets and less than $5 million in annual turnover will be permitted to raise up to $5 million in funds in any 12-month period.
As a further incentive, Ms O’Dwyer added that companies who choose to become an unlisted company in order to access funding will receive “a holiday” of up to five years from some reporting and governance requirements.
In an attempt to further increase the attractive nature of Australian business, Ms O’Dwyer noted that the Australian model is competitive on a global scale, with the issuer cap of $5 million each year higher than New Zealand and the US, alongside a higher than average investor cap.
ASIC will be tasked with the ongoing responsibility of issuing licences to intermediaries, who will play a ‘gatekeeper role’ in conducting checks on companies before their offer is listed.
Ms O’Dwyer also announced that the government will consult on options to facilitate crowdsourced debt funding in 2016.