The European Crowdfunding Service Providers Regulation and the Future of Marketplace Lending and Investing in Europe: the ‘Crowdfunding Nature’ Dilemma

The European Commission’s Proposal for a Regulation on European Crowdfunding Service Providers (ECSPs) for businesses, since its presentation, has faced difficult trilateral negotiations among the European Commission, the European Parliament and the Council of the European Union. The length of the legislative process can be explained not only by the insurgence of nationalisms and the uncertainty related to Brexit negotiations, but also because of the different views of the three European Institutions about crowdfunding and on how to regulate it. Nonetheless, they eventually reached an agreement in December 2019 but the Regulation is still waiting for its formal adoption. The present paper, after briefly describing crowdfunding main features, will critically and analytically analyze the main aspects of the proposed ECSPs Regulation, with respect to all existing versions, underlying their pros and cons and proposing adjustments to reach a functional, tiered and proportional regulation and shed light on the nature and future of financial-return crowdfunding in Europe