The government’s equity crowdfunding bill for private companies has finally passed the lower house, while a Labor amendment aimed at cutting the six month waiting period in half has been rejected.
The Corporations Amendment (Crowd-sourced Funding for Proprietary Companies) Bill 2017 was introduced to the House of Representatives in September last year, but has remained there ever since.
Nearly six months later, it was finally debated on Monday evening, and read for a second and third time. With support from the government and the Opposition, the bill was easily passed by the House and will now be sent to the Senate.
With bipartisan support, the legislation will easily pass through the Senate and into law.
But with a six month royal assent wait once it is approved, equity crowdfunding won’t be available to private companies until at least September, a year after the legislation was first introduced to the Parliament.
While supporting the bill, shadow minister for the digital economy Ed Husic moved an amendment to the second reading to cut this wait time down to three months.
“We have been accelerating at glacial speeds – there has been a long and tortured journey just to get this legislation debated,” Mr Husic said in Parliament.
“They’ve had enough time to bring in the regime, they’ve had enough time to bring in things within ASIC, and they can certainly bring forward the start date from royal assent from six months to three.,” he said.
“We don’t think this is unreasonable based on our consultations with stakeholders. We think that if the government is so confident with its regime and in all the time it has taken and all the protections they’ve put in place, why put in another six month delay?”
“We remain committed to supporting a viable regime but we are not about building in further delay as a result of the government’s inability to get its act together.”
But the amendment was rejected by the government, and voted down by the House 76-67.
Labor plans to again put the amendment when the bill is debated in the Senate, and is currently in talks with crossbench senators to gather support for it.
A number of other Labor MPs also spoke in Parliament in support of the bill, but were heavily critical of the long wait for it to be brought to the House, including Terri Butler and Matt Keogh.
Treasurer Scott Morrison did not speak during the debate, with his deputy Michael Sukkar instead discussing the benefits of extending equity crowdfunding to private companies, without commenting on the long delay.
“The Turnbull government is getting on with the job of supporting innovation and small businesses. This will allow more businesses to use this to grow in Australia,” Mr Sukkar said.
“This is another example of how the government is removing regulatory barriers and enabling innovative economic activity and allowing Australian entrepreneurs to access the capital they need to turn good ideas into economic successes.”
The extension was first flagged in last year’s federal budget, with draft legislation released on the same day, and the final legislation introduced to Parliament in September last year, but they have only just been approved by the lower house.
Mr Husic said the delays had hurt the local tech and startup sectors.
“They say it’s a game-changer, a boost for innovation, and all the cliches get recycled for the purpose of a ministerial speech or a press release, but as is often the case with the Coalition, it takes its sweet time to create and produce outcomes,” Mr Husic said.
“How many opportunities did we miss out on because those opposite wanted the headline rather than the substance?” he said.