The Federal Minister for Small Business, the Hon. Bruce Billson, has released a consultation paper on extending crowd-sourced equity funding (CSEF) to small proprietary companies and seeks to identify unnecessary compliance costs and fundraising constraints under the Corporations Act for these companies.
Minister Billson said: “The Government is making it easier for small businesses to access the capital they need to grow and thrive by removing obstacles to crowd-sourced equity funding. This change compliments the expanded tax concessions for Employee Share Schemes introduced in our 2015 Budget which passed in the last sitting of Parliament.”
Following a recent consultation on a potential SCEF regulatory framework, to which AusBiotech made a submission (view here), the latest paper provides a proposal to extend CSEF to proprietary companies and sets out the Government’s intended approach to a CSEF framework for public companies.
“We have listened to feedback provided during earlier consultation on a possible CSEF framework and are now seeking views on whether the forthcoming CSEF framework for public companies should be extended to proprietary companies," said Minister Billson.
The Government says it is developing legislation to implement this framework and intends to introduce it to Parliament in the Spring sittings. Draft legislation will be released for public consultation prior to its introduction.
The paper also considers areas of the Corporations Act which may be unnecessarily restricting the ability of small proprietary companies to raise capital to invest and grow.
It specifically discusses whether it may be possible to simplify: the requirement to make an annual solvency resolution; the requirement to maintain a share register; the execution of documents; and completing and lodging forms with the regulator, and it also seeks views on other areas of the law that may be burdensome.
The consultation paper is now available for comment at www.treasury.gov.au. Submissions close on 31 August 2015.