Can I use crowdfunding to raise money without violating securities laws in South Carolina? What are the requirements?

To use crowdfunding to raise money in South Carolina, you must comply with securities laws. The requirements for crowdfunding in South Carolina are governed by the South Carolina Uniform Securities Act. Under this act, crowdfunding is allowed, but it must be done in compliance with the state’s securities laws.

To comply with the securities laws, you must register your crowdfunding offering with the South Carolina Securities Division or qualify for an exemption from registration. One exemption that may be available is the crowdfunding exemption, which allows for crowdfunding offerings of up to $5 million in a 12-month period. To qualify for this exemption, you must meet certain requirements, including:

• The offering must be conducted through a registered broker-dealer or funding portal.
• The offering must be made to South Carolina residents only.
• The issuer must file certain disclosures with the Securities Division and provide them to investors.
• The issuer must comply with certain investment limits and other requirements.

For more information on crowdfunding in South Carolina and the requirements for compliance with securities laws, you can refer to the South Carolina Uniform Securities Act ^[1.1] and consult with a qualified securities attorney.

^[1.1]: SCCL 35-1-100 et seq.

Source(s):

• [1.1] South Carolina Children’s Advocacy Medical Response System.

Jurisdiction

South Carolina

• General