ASIC updates guidance as crowd-sourced funding regime extends to proprietary companies

ASIC has released updated regulatory guides to coincide with the extension of the crowd-sourced funding (CSF) framework to eligible proprietary companies. This starts on 19 October 2018.

ASIC has amended its guidance to include proprietary companies and updated requirements for public companies after consulting with those parties that made submissions to Consultation Paper 288 Crowd-sourced funding: Guide for public companies and Consultation Paper 289 Crowd-sourced funding: Guide for intermediaries.

Regulatory Guide 261 Crowd-sourced funding: Guide for companies (RG 261) helps public and eligible proprietary companies to understand and comply with the additional reporting requirements and accountability standards that apply to companies raising funds through the CSF regime. ASIC recognises that this is a new regime for proprietary companies and these companies will not have experience in making public offers of their shares.

Regulatory Guide 262 Crowd-sourced funding: Guide for intermediaries (RG 262) helps intermediaries seeking to provide a crowd-funding service to public and eligible proprietary companies. It explains intermediaries’ unique gatekeeper obligations as operators of platforms for CSF offers and investments.

ASIC’s website has further information on crowd-sourced funding for both intermediaries wanting to be authorised to provide a crowd-funding service and for companies seeking to crowd-fund.

ASIC’s MoneySmart website has further information for investors on how to invest through crowd-sourced funding.



The CSF framework was established in Australia on 29 September 2017 when the Corporations Amendment (Crowd-sourced Funding) Act 2017 took effect. The regime allowed eligible public companies to make offers of their shares, via a licensed CSF intermediary, using an offer document. To date, there are 13 licensed CSF intermediaries and 10 completed offers have been made under the CSF regime.

In September 2018, the federal Parliament passed the Corporations Amendment (Crowd-sourced Funding for Proprietary Companies) Act 2018 (CSF Pty Act), which extends the CSF regime to proprietary limited companies. The CSF Pty Act received the Royal Assent on 21 September 2018 and takes effect on 19 October 2018. In summary, the CSF Pty Act:

  • extends the CSF framework to include eligible proprietary companies as well as public companies;
  • introduces new corporate governance and reporting requirements for proprietary companies with CSF shareholders and increases the threshold for requiring an audit from $1 million to $3 million;
  • introduces an exception from the takeovers rules in Chapter 6 of the Corporations Act for proprietary companies with CSF shareholders; and
  • removes the temporary corporate governance concessions for proprietary companies that convert to or register as public companies to access the CSF regime.

© Australian Securities & Investments Commission. Reproduced with permission.