The distinction between sophisticated and non-sophisticated investors stems from European Regulation 2020/1503, which defines different rules for protection and freedom of investment, based on the classification of professional and non-professional clients in Directive 2014/65/EU (MiFID II).
With this distinction, the regulator aims to provide each of these investors with specific rules and protection. Sophisticated investors have greater autonomy and broader limits, while non-sophisticated investors benefit from greater protection, such as the right to a cooling-off period.
Classification is mandatory and is done through a short questionnaire at the end of the registration process. Without completing it, the investor cannot invest.
Find out more about the European regulation on crowdfunding providers here.
If you need further clarification, please get in touch with us at support@daskapital.eu.
