Labor ramps up crowd funding plan
Ed Husic: Promising crowd funding changes in the first 100 days
Labor innovation spokesperson Ed Husic has indicated a Labor government would get an equity crowd funding regime up and running within 100 days of being elected.
Long mulled over by both Labor and Coalition goverments, a Coalition bill to enable equity crowd funding had passed the House of Representatives but stalled in the Senate before parliament was dissolved by Prime Minister Malcolm Turnbull triggering a double dissolution election.
The bill would have allowed publicly unlisted companies with annual turnover and gross assets of less than $5 million to raise up to $5 million per year from individuals in return for equity in the company. The maximum investment per individual was to have been $10,000 a year.
Mr Husic, who was speaking after a policy debate with Angus Taylor, the Coalition’s Assistant Minister for Cities and Digital Transformation, said that access to equity crowd funding should be less onerous than in the Coalition’s stalled bill.
“I don’t think we should force companies to go public early on, it’s hard to wind a public company back into private." Mr Husic said.
“There’s a very arcane debate that we have to have these protections in place which I don’t think are genuine protections. We need to have the reporting requirements of people going for an equity crowd funding platform aligned to the expectations we would have for them going for a VC funding round," he said.
As for how long it would take to get the legislation up, Mr Husic said: "It is an absolute no-brainer we could easily get this done in the first one hundred days."
During the Innovationaus.com Innovation Policy Debate 2016 Mr Taylor said that when previously in government, Labor had plenty of opportunities to enable equity based crowd funding but had failed to do so.
Bu he also acknowledged his side of politics needed to widen crowd funding beyond just public unlisted companies, which require fairly costly and stringent procedures to set up.
"We have made a start and we know we have to go further. We know we have to get to private companies, that’s next. The work is ongoing but we are absolutely committed," Mr Taylor said.
Australian Venture Capital Association CEO Yasser El-Ansary said the whoever was in government after the election needed to speed up the legislative process.
"There’s not a great deal to do here, we need to get on with it. There’s a range of other policy initiatives that need to be progressed as well," he said.
Australian Information Industry Association (AIIA) CEO Rob Fitzpatrick said the major parties should debate innovation policy more often.
"We should spar more, and we could spar a whole lot more. There are whole lot more questions we could debate," he said.