On 10 November 2021, the Crowdfunding Service Provider Regulation ((EU) 2020/1503 - European Crowdfunding Service Provider Regulation - "ECSPR") will enter into force.
In a first article, we reported on the scope of application of the ECSPR and the permission requirement for crowdfunding service providers; in a second article, on the ongoing requirements for crowdfunding service providers and their conduct obligations; in a third article, on the treatment of crypto-tokens under the ECSPR; in a fourth article, on the current German crowdfunding models under the ECSPR. In this fifth contribution, we will address the question of which obligations under money laundering law apply to a crowdfunding service provider.
1. Obliged entity?
In the context of the obligations under money laundering law, the first question is whether crowdfunding service providers are obliged entities within the meaning of the German Money Laundering Act (Geldwäschegesetz - GwG) (the implementation of the European Money Laundering Directives). Obliged entities are subject to certain duties of care and organisation, such as customer due diligence (KYC) when entering into business relationships, such as the identification of the contractual partner, or certain risk management requirements.
The German Money Laundering Act and also the European directives on money laundering do not include crowdfunding service providers in the list of obliged entities so far. Instead, after consulting the European Securities and Markets Authority (ESMA) and the European Banking Authority (EBA), the European Commission is to submit a report to the European Parliament and the Council by 10 November 2023 in which it will assess, among other things, the necessity and proportionality of subjecting crowdfunding service providers to obligations for compliance with national implementations of the Money Laundering Directive.
Should the Commission's report come to the conclusion that the money laundering risk of swarm financing service providers is higher than currently assumed, it is likely that crowdfunding service providers will be included in the scope of the Money Laundering Directive. However, until such time as the adapted Money Laundering Directive is implemented (or gold-plating is made in Member States), crowdfunding service providers are not obliged entities under money laundering law.
2. Other obligations in relation to money laundering law
Even if crowdfunding service providers are not themselves subject to anti-money laundering obligations, there are nevertheless regulations that serve to combat money laundering:
3. Do you have questions about becoming a crowdfunding service provider?
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