Application Process for Crowdfunding Service Providers

The purpose of this section is to provide information to firms considering applying for authorisation as a crowdfunding service provider.

Regulation (EU) 2020/1503 of the European Parliament and of the Council of 7 October 2020 on European crowdfunding service providers for business, and amending Regulation (EU) 2017/1129 and Directive (EU) 2019/1937 (“Regulation (EU) 2020/1503”) establishes an EU regulatory regime for crowdfunding service providers.

The Central Bank of Ireland is the competent authority in Ireland responsible for the authorisation and supervision of crowdfunding service providers pursuant to the European Union (crowdfunding) Regulations 2021 (S.I. No. 702 of 2021) (“the Regulations”).

The Central Bank seeks to process each application as expeditiously as possible while meeting its obligation to operate a rigorous and effective gatekeeper function. It aims to ensure that the application process is facilitative and accessible from the perspective of applicants and, importantly, that applicants have clarity with regard to the process, its requirements and timelines.

Before Applying for Authorisation

Each proposed crowdfunding service provider (or “applicant”) considering applying for authorisation must first consider whether its proposed business model:

Requires authorisation pursuant to Regulation (EU) 2020/1503
Can comply with the authorisation requirements pursuant to Regulation (EU) 2020/1503
Can comply with the Central Bank’s requirements and any other relevant financial services law and
Is capable of complying with, and adhering to, the supervisory requirements that must be satisfied on an ongoing basis.

Applicants are advised to seek legal advice if they are unsure as to whether their proposed activities require authorisation pursuant to Regulation (EU) 2020/1503, or if they are unsure as to how they should comply with the relevant authorisation requirements.

Having satisfactorily completed each consideration above, the applicant should review the Guidance Note on Completing an Application for Authorisation as a crowdfunding service provider in its entirety. This is to ensure that the applicant is familiar with the authorisation process and the requirements of the Central Bank. Only then should the applicant contact the Central Bank by emailing [email protected] with a view to arranging a preliminary meeting. It is normal practice for the Central Bank to meet with applicants and discuss their proposed business model prior to beginning the authorisation process.

The Central Bank adopts a robust, structured and risk-based approach in order to fulfil its gatekeeper function. In this regard, the Central Bank welcomes applications where the applicant can meet the legislative requirements relating to authorisation as a crowdfunding service provider (including ESMA Technical Standards and related Guidance) and all other applicable legislative and regulatory requirements published by the Central Bank.

Summary of the Key Stages in the Application Process

A preliminary meeting will be held with the applicant in advance of an application being made.
Following on from this, the applicant must submit the following (as defined in the Guidance Note on Completing an Application for Authorisation as a crowdfunding service provider, an Application refers to the submission of a fully completed Application Form and fully completed IQs):
- An electronic copy of the completed Application Form for Authorisation as a crowdfunding service provider (including all the specific information and supporting documentation requested therein) via our secure file transfer system (access can be requested from [email protected])
- Following this submission, the individual nominated by the applicant to be the Fitness and Probity Administrator should register for access to the Central Bank of Ireland Portal as outlined on our website. The Fitness and Probity Administrator will then be able to provide each individual proposed for a Pre-Approval Controlled Function(“PCF”) with the relevant permissions in order to submit the Individual Questionnaire (“IQ”) Completed IQs (including all the specific information and documentation requested therein) must be provided in respect of all relevant individuals proposed to hold a Pre-Approval Controlled Function (“PCF”) role in the applicant. Further information on the PCF assessment is available on the Central Bank’s website.
The Central Bank acknowledges receipt of the application form within ten working days of its receipt.
Within 25 working days of the receipt of the application form, the Central Bank assesses whether the Application is complete i.e. whether the application contains all the required information and documentation (which includes the information and documentation required in the application form and the appropriate IQs).
Incomplete applications: where all the required information and documentation has not been provided, the Central Bank will identify the missing information and set a deadline for the applicant to provide the missing information. Should an Application remain incomplete after this deadline, the Central Bank may refuse to review the application and, in the event of such refusal, shall return the submitted documents to the Applicant.
Completed applications: where an application is deemed complete, the Central Bank will notify the applicant. The Central Bank will then complete an assessment of the application and may issue detailed comments and/or seek additional information.
The applicant is provided with the opportunity to address the comments and requests issued by the Central Bank in a revised Application submission(s).
A decision will be made regarding application within three months from the date it is determined to be complete.
The Central Bank will notify the Applicant of its decision in respect of the application.

In the sections set out below, the applicant will be able to learn about the different stages of the application process in more detail.

Documentation Required to Make an Application for Authorisation

Applicants should submit the following documentation which should be fully completed:

The Application Form for Authorisation as a crowdfunding service provider (including all the specific information and documentation requested therein), including the applicant’s business plan and programme of operations) and
IQs (including the specific information and documentation requested therein) in respect of each person proposed to hold a PCF role in the applicant.

Where an applicant proposes to operate on a cross border (freedom of services) basis within the European Economic Area (EEA) it should also submit the following information:

A list of the member states in which the applicant intends to provide crowdfunding services
The identity of the natural and legal persons responsible for the provision of the crowdfunding services in those member states
The starting date of the intended provision of the crowdfunding services by the applicant and
A list of any other activities provided by the applicant not covered by Regulation (EU) 2020/1503.

Important:

The completed application form, along with all relevant accompanying material, should be submitted in electronic format to the Central Bank via our secure file transfer system. Please request access via email to: [email protected]. Please note that the submission of a hardcopy documentation is not required.

The completed IQs, along with all relevant accompanying material, should be submitted electronically via the Central Bank’s Online Reporting System (“ONR”) by all proposed PCF role holders. The applicant will be provided with login details for the ONR and the applicant will need to ensure that all relevant individuals proposed to hold a PCF role (typically board members, senior management, key function holders) complete Fitness and Probity IQs (view more information and guidance material on completing the IQ).

Key Stages in the Application Process

Stage 1 – Preliminary Meeting

The applicant should request a preliminary meeting with the Central Bank to discuss its proposed application.

A meeting request should be sent by the applicant via e-mail to [email protected] and set out, at a high level, the proposed authorisation being sought.

The Central Bank will revert to the applicant to schedule the preliminary meeting.

The applicant is required submit a short presentation and a list of attendees five business days in advance of the preliminary meeting with the Central Bank. The presentation should be reasonably high level and include, where relevant, the following:

High level background information on the applicant (and group where applicable) e.g. business line and history
Rationale for selecting Ireland as their European place of business
Proposed business lines (new) and current track record (if existing firm)
Description of the services/activities (including other services / activities as outlined in Section 4.1.1 (c) of the Application Form) to be provided by the Applicant at authorisation date and those services / activities the Applicant will look to provide in the future (if known)
Staffing and governance proposals
Details of any proposed outsourcing arrangements
Revenue and Regulatory Capital projections
Any other information that the Applicant Firm considers pertinent.

At the preliminary meeting, the applicant will be informed of the Central Bank’s authorisation process and timeframes.

Stage 2 – Submission and Completeness Check of Application Form and Individual Questionnaires

Should the applicant wish to proceed to make an application for authorisation after the preliminary meeting with the Central Bank, the applicant will need to submit a fully completed Application Form for Authorisation as a crowdfunding service provider (including all the specific information and documentation requested therein).

Following this submission, the individual nominated by the applicant to be the Fitness and Probity Administrator should register for access to the Central Bank of Ireland Portal as outlined on our website. The Fitness and Probity Administrator will then be able to provide each individual proposed for a PCF with the relevant permissions in order to submit the IQ. Fully completed IQs (including all the specific information and documentation requested therein) must be submitted in respect to each person proposed to hold a PCF role in the Applicant.

The Central Bank will acknowledge receipt of the application form within ten working days of its receipt.

Within 25 working days of the receipt of the application form, the Central Bank assess whether the application is complete i.e. whether the application contains all the required information and documentation (which includes the information and documentation required in the application form and the IQs).

Incomplete applications: where all the required information and documentation has not been provided, the Central Bank will identify the missing information and set a deadline for the applicant to provide the missing information. Should an application remain incomplete after this deadline, the Central Bank may refuse to review the application and, in the event of such refusal, shall return the submitted documents to the applicant.
Complete applications: an application is deemed complete when the applicant has provided all of the information required under Article 12 (2) of Regulation (EU) 2020/1503 (which includes the information required in the Application Form and the IQ). Where an application is deemed complete, the Central Bank will notify the applicant. The Central Bank will then complete an assessment of the application and may issue detailed comments and/or seek additional information.

Individual Questionnaires

IQs must be completed and submitted online and can be accessed via the Central Bank of Ireland Portal.
The applicant shall ensure that all the information and documentation requested in the IQ is submitted by all proposed PCF role holders in order that fully completed IQs are deemed to have been received.

Stage 3 – Assessment of the Application

Where an application has been received and deemed complete, as outlined in stage two above, the Central Bank will then proceed to the assessment phase of the application process.

In order to be in a position to meet the assessment timeframes for authorisation as set out in Regulation (EU) 2020/1503, the Central Bank cannot engage in an exhaustive verification exercise of the information provided by the applicant in its application. The onus is on the applicant to ensure all information in the application form and IQs and all supporting information submitted meets the relevant requirements.

The board of directors of the applicant must provide an attestation on the headed paper of the applicant and signed by two directors of the applicant confirming certain matters on behalf of the applicant. More information on the Attestation is outlined in the Guidance Note on Completing an Application for Authorisation for Authorisation as a crowdfunding service provider and in Appendix 1 of the Application Form.

Stage 4 – Decision on Authorisation

The Central Bank will make a determination on the Application within three months of receipt of a complete application, as referred to above.

Successful applicants are issued with a letter of authorisation from the Central Bank setting out their authorisation requirements and any conditions of authorisation applicable.