ERDEM-NEWSLETTER-2018-metin

224 NEWSLETTER 2018 There are several approaches in the Member States how to define lending-based crowdfunding, and which legislative framework to be applicable. In some Member States, lending-based crowdfunding is seen as falling under the banking law or subject to payment services regulation or securities regulation. Another approach is to create be- spoke regimes for lending-based crowdfunding. France, the United Kingdom (UK), Spain and Portugal have adopted special regimes for lending-based crowdfunding. The bespoke regimes foresee a new type of intermediary to define the platforms, subject to lighter regulation than the banks and invest- ment firms. The platforms should have authorization from, and/or registration to, financial regulators or intermediary associations. For example, in the UK, authorization by the Financial Conduct Author- ity (“FCA”) is necessary. Platforms may also need other permissions, depending upon the activities they undertake. In France, registration with ORIAS (the association in charge of a single register of finance intermediaries) is necessary. ORIAS has to check if the platform is fit for the legal requirements (knowledge and competence, duty and pro- fessional indemnity insurance). Checks are carried out on a declarative basis. Platforms are regulated by the Bank of France - Autorité de contrôle prudentiel et de résolution - ACPR and supervised by the Direction générale de la concurrence, de la consommation et de la répression des fraudes - DGCCRF for consumer protection purposes. No ex-ante authorization is required 7 . In the UK, when handling money platforms, borrowers are re- sponsible for client money and are subject to the rules in the FCA Client Assets Sourcebook (CASS), as well as the client money rules (CASS 7), which ensure adequate protection of client money 8 . In France, platforms may provide payment services, and must follow the specific rules applying to such a service (credit institution, payment institution, or electronic money institution). The bespoke regimes often limit the scope of newly regulated businesses with respect to either the size of the loan obtainable by each borrower, or to the volume of the offer, to the sums investible by each 7 Working Document, p. 46. 8 https://www.fca.org.uk/firms/client-money-assets (Access date: March 2018).