Skip to main content
×
Home
    • Aa
    • Aa

Equity-Based Crowdfunding in China: Beginning with the First Crowdfunding Financing Case

  • Duoqi XU (a1) and Mingyu GE (a1)
Abstract
Abstract

Although the legality of equity-based crowdfunding was determined from a judicial point of view in the “first crowdfunding financing case” in 2015, there is no formal law, regulation, or rule released to regulate the crowdfunding financing. From a micro-perspective, determining the nature and workings of equity-based crowdfunding are two preconditions for determining the legal framework for and supervision of equity-based crowdfunding. The “Open, Public, Small-sum” characteristics defined the nature of public offering to the equity-based crowdfunding; therefore, it should be distinguished from private equity financing as a different category of online equity financing. Based on the original purpose of “financing facility” and the nature of “grassroots finance,” fundraisers shall enjoy exemptions on small sums, and the threshold of investors shall also be appropriately restricted, while the intermediary platform shall be the regulatory focus. From a macro point of view, the supervision of equity-based crowdfunding should seek a balance between “financial innovation” and “risk control.” Equity-based crowdfunding should not simply be considered a financing method. Rather, its positive effects on mass entrepreneurship and innovation should be emphasized so as to make it a particularly important “booster” to promote economic and social development.

Copyright
Footnotes
Hide All
*

Professor of KoGuan Law School of Shanghai Jiao Tong University, Ph.D., Director of the Research Centre of Internet Financial Legal Innovation, Shanghai, China 200030.

**

Master degree candidate in economic law, KoGuan Law School of Shanghai Jiao Tong University. This article is the stage achievement of National Social Science Fund Project “The major theoretical and practical issues regarding to the access and supervision of China’s Internet finance market” (16BFX098). Correspondence to Mingyu Ge, 5th Building, No. 1954 Huashan Road, Xuhui District, Shanghai, China, 200030. E-mail address: xuduoqi.law@gmail.com; gmy921102@126.com.

Footnotes
Linked references
Hide All

This list contains references from the content that can be linked to their source. For a full set of references and notes please see the PDF or HTML where available.

Florian Danmayr (2014) Archetypes of Crowdfunding Platforms: A Multidimensional Comparison, Wiesbaden: Springer Gabler.

David M. Freedman , & Matthew R. Nutting (2015) Equity Crowdfunding for Investors: A Guide to Risks, Returns, Regulations, Funding Portals, Due Diligence, and Deal Terms, NJ: John Wiley & Sons.

Othmar M. Lehner (2013) “Crowdfunding Social Ventures: A Model and Research Agenda.” 15 Venture Capital Journal 289311.

Recommend this journal

Email your librarian or administrator to recommend adding this journal to your organisation's collection.

Asian Journal of Law and Society
  • ISSN: 2052-9015
  • EISSN: 2052-9023
  • URL: /core/journals/asian-journal-of-law-and-society
Please enter your name
Please enter a valid email address
Who would you like to send this to? *
×

Keywords:

Metrics

Full text views

Total number of HTML views: 108
Total number of PDF views: 145 *
Loading metrics...

Abstract views

Total abstract views: 370 *
Loading metrics...

* Views captured on Cambridge Core between 7th March 2017 - 20th September 2017. This data will be updated every 24 hours.