Crowdfunding: Eligibility for Exemption from Registration of Securities

Crowdfunding is an exemption to the requirement that securities cannot be sold or offered for sale within the Philippines without a registration statement filed with and approved by the Securities and Exchange Commission (SEC). Under the Crowdfunding Rules, an issuer may offer or sell securities, provided that: 

Related discussions:
* Introduction of crowdfunding in the Philippines
* Disqualification of intermediaries
* Permitted activities of intermediaries
* Ongoing obligations of intermediaries
* Prudential requirements of intermediaries
* Measures to reduce risk of fraud

* Registration of crowdfunding intermediary
* Account opening requirements
* Requirements for crowdfunding transactions
* Completion of offerings, cancellations, reconfirmations
* Registration of funding portals
* Registration of crowdfunding Issuers

1. The issuer is an entity organized under the laws of the Philippines or a Filipino natural person, and accredited and/or accepted by a crowdfunding intermediary to utilize its platform. [See Issuer requirements in crowdfunding]

2. The aggregate amount of securities that can be offered and sold by issuer within a 12-month period shall comply with the following limits:

  • i. Offering of securities with an aggregate value of up to P10M within a 12-month period can be offered and sold to any investor;
  • ii. Offering of securities with an aggregate value of above P10M but not exceeding P50M, within a 12-month period can only be offered and sold to Qualified Investors

3. The aggregate amount of securities sold to any investor across all issuers in securities crowdfunding during the 12-month period shall not exceed the following limits set forth: 

4. The issuance of securities is conducted through an intermediary that complies with the requirements for intermediaries and the related requirements under the Crowdfunding Rules, and the issuance of securities is conducted exclusively through the intermediary’s platform. Similar crowdfunding done through medium other that online electronic platform may not avail of this exemption from registration of securities.

For purposes of calculating aggregate amount of securities offered and sold by an issuer and determining whether an issuer has previously sold securities within a 12-month period, “issuer” shall include all entities controlled by or under common control with the issuer and any predecessors of the issuer. 

P&L Law

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