South Korea's Financial Services Commission says that it is proposing to make amendments to the Enforcement Decree of the Financial Investment Services and Capital Markets Act in respect of crowdfunding.

In their final shape the amendments, open for public comment until 1 September, might take effect as early as January next year. They are expected to allow start-ups and small/medium-sized businesses to obtain crowdfunding, through which high-net-worth investors might contribute.

Investors will be subject to different caps on the amounts they are allowed to put into this-or-that company or during a particular year, depending on their professional investment knowledge and/or risk-absorbing capacity.   

Professional investors (i.e. market traders and such) will, if the rules go through unchanged, be subject to no cap at all. HNWs or "investors who meet certain income requirements" will be subject to a cap of 10 million won (US$8,436) on their investments in any one company and 20 million won (US$16,868) in any given year. The general public will be capped at 2 million won (US$1,687) per company and 5 million won (US$4,217) per annum.

In principle, investors will be prohibited from selling securities within a year of issuance. In exceptional cases, investors will be allowed to sell securities within a year of issuance to those who acquire sufficient information about the company - e.g professional investors and securities issuers.

The minimum amount of equity capital will be set at 500 million won (US$421,720) for an online brokerage firm to be registered as a ‘crowdfunding business.'