(1)

In order to ensure that crowdfunding service providers carry out the entry knowledge test for prospective non-sophisticated investors referred to in Article 21 of Regulation (EU) 2020/1503 in a harmonised way, it is necessary to lay down common rules for the assessment of whether and which crowdfunding services offered are appropriate for the prospective non-sophisticated investors.

(2)

In order to ensure that crowdfunding service providers ascertain that prospective non-sophisticated investors understand the level of risk associated with crowdfunding investments, crowdfunding service providers should take reasonable steps to ensure that the information collected from prospective non-sophisticated investors is reliable and reflects accurately their knowledge, skills, experience and financial situation, investment objectives and basic understanding of the risks involved.

(3)

Investors should be informed clearly and in a uniform manner about the risks they would incur if they decide to invest in crowdfunding services. Crowdfunding service providers should therefore issue a harmonised risk warning to prospective non-sophisticated investors failing the entry knowledge test following specific requirements on how the warning should be displayed to such investors.

(4)

In order to promote investor protection and ensure that the simulation of the ability to bear loss is performed adequately by prospective non-sophisticated investors, crowdfunding service providers should make available on their website an online calculation tool aiming at helping prospective non-sophisticated investors to simulate their ability to bear loss. However, because of the sensitive nature of the information to be provided by prospective non-sophisticated investors in such online calculation tool, that tool should be set up in a way that prevents crowdfunding service providers from being able to access or record the information inputted by prospective non-sophisticated investors.

(5)

In order to ensure that information provided by prospective non-sophisticated investors in the online calculation tool by cannot be collected without their express consent, that tool should be set up in a way that prevents crowdfunding service providers from altering or interfering with the result of the simulation performed by prospective non-sophisticated investors. Furthermore, in order to protect prospective non-sophisticated investors and in particular to enable them to check that the information they inserted is correct and accurate, the result of the simulation of the ability to bear loss should not be collected directly by crowdfunding service providers but rather should only be shared willingly by prospective non-sophisticated investors once they consider that the result of the simulation reflects adequately their ability to bear loss.

(6)

In order to ensure flexibility in the way the simulation of the ability to bear losses is performed, crowdfunding service providers should be able to offer prospective non-sophisticated investors the possibility to simulate their ability to bear losses through a different method without the help of the online calculation tool, provided that such possibility is offered in addition to making the online calculation tool available on the crowdfunding service providers’ website.

(7)

In order to ensure a harmonised approach in the simulation of prospective non-sophisticated investors’ ability to bear losses, rules should be laid down with regard to how the net worth of prospective non-sophisticated investors should be calculated, based on their annual income, total of liquid assets and annual financial commitments.

(8)

Given the risks of divergent approaches, and the potential negative consequences of such divergences on the meaningfulness of the simulation of prospective non-sophisticated investors’ ability to bear losses, it is appropriate to specify with a sufficient degree of detail how each of the components used to calculate the net worth should be computed and to establish a common date for the valuation of the various components.

(9)

This Regulation is based on the draft regulatory technical standards submitted to the Commission by the European Securities and Markets Authority and developed in close cooperation with the European Banking Authority.

(10)

The European Securities and Markets Authority has conducted open public consultations on the draft regulatory technical standards on which this Regulation is based, analysed the potential related costs and benefits and requested the advice of the Securities and Markets Stakeholder Group established in accordance with Article 37 of Regulation (EU) No 1095/2010 of the European Parliament and of the Council (2).

(11)

The European Data Protection Supervisor was consulted in accordance with Article 42(1) of Regulation (EU) 2018/1725 of the European Parliament and of the Council (3) and delivered an opinion on 1 June 2022,