Role of alternative finance
According to the 2nd European Alternative Finance Industry Report, Latvia raised € 15m through Alternative Financing.
A surprising aspect with regards to Latvia's high contribution of alternative finance per person (€ 7.68) in contrast to the GDP figure.
In central and eastern Europe, the growth rate from 2014 to 2015 was 167%
3 platforms are active at the moment.
Pursuant to the Financial Instrument Market Law (“FIML”), anyone intending to provide investment services in Latvia, commercially or on a scale which requires a commercially organised business undertaking, requires a licence from the Financial and Capital Market Commission (“FCMC”). Where an online Crowdfunding platform facilitates the offering of financial instruments, most likely, the operator of the platform will be deemed to provide investment services within the meaning of the FIML and therefore will require a licence by the FCMC.
|Reward and donation-based crowdfunding||
EUR 0,2m have been raised by Rewards-based crowdfunding in 2015.
The market volume for Peer-to-Peer Consumer Lending was about EUR 15m in 2015.
|Is there a specific national regulation in place applying to crowdfunding?||
In principle, Latvian law allows for the implementation of Crowdfunding projects. In each situation it is recommended to involve local advice. - If a Crowdfunding platform facilitates the offering of securities or other financial instruments, or it holds money belonging to third persons, the operator of the platform most likely provides investment or financial services. In this case, FCMC authorisation required. Where securities do not qualify as financial instruments, this may fall outside the scope of investment services regulation, although guidance from FCMC would be advised.
(source: Osborne Clarke Germany (2016): Review of Crowdfunding Regulation & Market Developments. In: CrowdFundRES - Unleashing the potential of Crowdfunding for Financing Renewable Energy Projects. Deliverable 3.1 (PU).
- Prospectus requirement for public offer regarding transferable securities (i.e., offer is expressed to more than 150 individuals in one EU Member State).
(source:Osborne Clarke Germany (2016): Review of Crowdfunding Regulation & Market Developments. In: CrowdFundRES - Unleashing the potential of Crowdfunding for Financing Renewable Energy Projects. Deliverable 3.1 (PU). http://www.crowdfundres.eu/wp-content/uploads/2016/06/CrowdFundRES-Crowd...)
Currently, matching funds, state aid or tax benefits for alternative finance are not available in Latvia.
Latvijas Republikas Finanšu Ministrija - Ministry of Finance of the Republic of Latvia, http://www.fm.gov.lv/en/
|Matching funds initiatives|
|Crowdfunding guidelines for entrepreneurs / investors|
|Guidelines for researchers on crowdfunding for R&I|