Ghana Securities Industry Draft Guidelines (Crowdfunding), 2022

July 06, 2022


The Securities and Exchange Commission of Ghana (“SEC”) in April 2022 released the Draft Ghana Securities Industry (Crowdfunding) Guidelines (“Draft Guidelines”). These Draft Guidelines were published by the SEC pursuant to the Securities Industry Act, 2016 (Act 929) and apply to a company or an organization seeking or required to be licensed by the SEC as a Crowdfunding Intermediary in accordance with the Act. A Crowdfunding Intermediary is defined as a business that is licensed by the SEC to run crowdfunding operations.

The Draft Guidelines provide rules covering: the application for a licence as a Crowdfunding Intermediary, obligations of a Crowdfunding Intermediary, participants of crowdfunding, requirements with respect to transactions, obligations of issuers, restrictions on activities, and additional requirements for soft commodities digital investment platforms.

All public companies incorporated in Ghana with at least a one (1) year operating track record or start-ups with at least a three (3) year business plan are eligible to raise funds through a Crowdfunding Platform licensed by the SEC in exchange for the issuance of shares, debentures, or such other investment instrument as the SEC may determine from time to time. Each Crowdfunding Intermediary shall have and maintain its own Crowdfunding Platform.

An application for a licence as a Crowdfunding Intermediary must be made to the SEC, providing general information about the applicant and any other details as requested. The SEC will consider an application and inform an applicant of its decision within ninety (90) days.

A Crowdfunding Intermediary has numerous obligations under the Draft Guidelines, including providing investor education programmes and ensuring that the document which contains all disclosed information lodged with its Crowdfunding Platform by each issuer is verified for accuracy and made accessible to investors. A Crowdfunding Intermediary must also carry out due diligence on prospective issuers intending to use its Crowdfunding Platform. Additionally, it must monitor the conduct of issuers. Finally, a warning statement must be prominently displayed: to all visitors to the site on the home page of the Crowdfunding Platform; to every investor on the subscription landing page for each issuer; and on all application forms for investing through the Crowdfunding Platform.

Issuers and investors who are participants of crowdfunding must follow the outlined investor rights pertaining to the securities being issued as stated in the Draft Guidelines. An issuer shall offer its securities or investments through a licensed Crowdfunding Platform and shall be required to file an offer document with the SEC through the Crowdfunding Intermediary. Investors may be allowed to invest in companies hosted on the Crowdfunding Platforms subject to the investment limit specified by the SEC from time to time. They may withdraw their offer at any time before the end of the waiting period. Where there is a material adverse change affecting the project or the issuer, investors may rescind the investment within seven (7) days from the date the material adverse change became public.

A Crowdfunding Intermediary is prohibited from providing any financial assistance to investors for the purpose of investing in an offer hosted on its platform or for which it has provided a service, except where there is a margin trading agreement. The intermediary is also prohibited from compensating in any form a finder or an introducer for providing it with information about potential investors. Additionally, Crowdfunding Intermediaries and or their managers and officers are prohibited from soliciting investments or making recommendations.

The following entities are prohibited from raising funds through the services of a Crowdfunding Intermediary: entities with complex structures; public listed companies and their subsidiaries; companies with no specific business plan or a blind pool; companies that propose to use the

funds raised to provide loans or invest in other entities; all types of bank and non-bank financial institutions; and other entities as specified by the SEC.

A Crowdfunding Intermediary shall not discontinue the business or operation of a Crowdfunding Platform without prior approval of the SEC. Without prejudice to any provision in the Draft Guidelines, the SEC may issue a directive or impose any term or condition for the purposes of ensuring the orderly cessation of the business or operations of a Crowdfunding Intermediary.

Where an applicant fails to comply with these Draft Guidelines, the defaulter will be liable to an administrative penalty of GHS6,000 and/or the SEC may revoke or suspend its licence.

To view the Draft Ghana Securities Industry (Crowdfunding) Guidelines 2022, click here:

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