Civil Law and Crowdfunding Contractual Disputes in Europe

1. Introduction

Crowdfunding contractual disputes arise when investors, project owners, crowdfunding platforms, intermediaries, or service providers disagree about the rights and obligations created through a crowdfunding transaction.

Crowdfunding generally involves raising relatively small amounts from many persons through an internet platform. Under EU Regulation 2020/1503, crowdfunding may be lending-based or investment-based. In lending-based crowdfunding, the platform facilitates loans between investors and project owners; in investment-based crowdfunding, investors acquire transferable securities or similar instruments. (EUR-Lex)

Typical disputes include:

failure to repay investor money;

non-payment of interest;

validity of a subordinated/qualified-subordinated loan;

misleading investment information;

failure to disclose risks;

defective or incomplete key investment information;

platform negligence;

misrepresentation by project owners;

unfair contractual clauses;

jurisdiction and choice-of-law disputes;

platform commission and service-fee disputes;

insolvency of the project owner;

liability of directors, advisers or intermediaries;

disputes over guarantees or security;

cross-border enforcement of crowdfunding contracts.

A particularly important feature is that the crowdfunding platform and the project owner are not necessarily the same contracting party. The legal analysis must first identify who actually contracted with the investor.

2. Meaning of Crowdfunding Contractual Dispute

A crowdfunding transaction may involve several separate legal relationships:

Investor → Crowdfunding Platform → Project Owner

There may also be:

Investor → Project Owner

or, in some structures:

Investor → Bank/SPV → Project Owner

Therefore, a court must determine:

Who is the borrower or issuer?

Who is merely the intermediary?

What contract was actually concluded?

What information was supplied before investment?

What law governs the contract?

Which court has jurisdiction?

Was the investor a consumer or professional investor?

What happens if the project becomes insolvent?

These questions are particularly important in cross-border European crowdfunding.

3. EU Legal Framework

A. Regulation (EU) 2020/1503

The central EU instrument is Regulation (EU) 2020/1503 on European Crowdfunding Service Providers for Business.

It establishes a common framework for crowdfunding services and aims to reduce fragmentation between Member States while increasing investor protection and facilitating cross-border crowdfunding. (EUR-Lex)

Important provisions include:

Article 3 — Conduct of business

Crowdfunding providers must act:

honestly;

fairly;

professionally;

in the best interests of clients.

Article 5 — Due diligence

Crowdfunding providers must conduct minimum due diligence concerning project owners.

Article 7 — Complaints

Platforms must maintain effective and transparent procedures for handling client complaints.

Article 8 — Conflicts of interest

The Regulation establishes restrictions and disclosure requirements concerning conflicts between platforms, project owners and investors.

Article 22 — Reflection period

Non-sophisticated investors receive a pre-contractual reflection period during which they may revoke an offer to invest or expression of interest without giving a reason or penalty. (EUR-Lex)

Key investment information

The Regulation also imposes requirements concerning the Key Investment Information Sheet (KIIS). EU law specifically requires Member States to ensure civil-liability rules apply to persons responsible for misleading, inaccurate or materially incomplete information in the KIIS. (EUR-Lex)

4. Other Important EU Rules

Crowdfunding disputes may additionally involve:

1. Rome I Regulation

Regulation (EC) No 593/2008 determines the law applicable to contractual obligations.

This becomes important where:

Investor = France
Platform = Germany
Project owner = Austria
Project = Spain

The court must determine which law governs the relevant contractual relationship.

2. Brussels I bis Regulation

Regulation (EU) No 1215/2012 deals with jurisdiction and recognition/enforcement of judgments in civil and commercial matters.

Consumer jurisdiction can be especially important where an individual investor sues a business.

3. Unfair Terms Directive

Directive 93/13/EEC can apply where an investor qualifies as a consumer and the contract contains standard, non-negotiated terms.

4. Prospectus and financial-services legislation

Depending on the instrument and structure, securities, prospectus and investment-services legislation may also apply.

5. Major Types of Crowdfunding Contractual Disputes

A. Non-payment of principal

The investor claims repayment of the amount invested.

The project owner may respond that:

the loan was subordinated;

repayment was conditional;

insolvency prevented repayment;

the contractual maturity has not arrived;

repayment would trigger insolvency.

B. Non-payment of interest

Disputes may concern:

agreed interest;

default interest;

performance-linked returns;

whether interest is payable during insolvency;

whether the investment was actually equity rather than debt.

C. Qualified subordinated loan disputes

This is particularly significant in Austrian and German-style crowdfunding.

A qualified subordinated loan may provide that repayment cannot be demanded where repayment would cause or deepen insolvency.

Consequently, the investor cannot simply argue:

“The contractual maturity date has arrived, therefore I automatically receive my money.”

The court may first have to determine whether the contractual subordination condition has been triggered.

D. Misrepresentation

An investor may allege that the project was presented as:

safe;

guaranteed;

low-risk;

highly profitable;

adequately secured.

If the actual risk was materially different, contractual, tortious or statutory liability may arise depending on the applicable national law.

E. Inadequate investment information

A dispute may concern:

missing financial information;

incorrect project information;

failure to disclose insolvency risks;

incorrect statements about collateral;

misleading projected returns;

incomplete information concerning the project owner.

F. Platform liability

A major legal question is:

Is the platform itself liable for the investor's loss?

The answer depends upon the platform's contractual duties and statutory obligations.

A platform cannot automatically be treated as the borrower simply because it arranged the investment.

However, liability may arise where the platform itself breached an independent legal duty, such as:

due diligence;

information duties;

complaint handling;

conflict-of-interest rules;

payment-related obligations;

contractual duties.

6. Cross-Border Jurisdiction

Suppose:

Investor is resident in Austria;

crowdfunding platform is incorporated in Germany;

project owner is incorporated in Italy;

project concerns property in Spain.

Several courts could potentially become relevant.

The analysis normally considers:

domicile of the defendant;

consumer jurisdiction;

place of contractual performance;

contractual jurisdiction clause;

exclusive jurisdiction rules where applicable;

governing-law clause;

mandatory consumer protection rules.

A recent Austrian appellate decision illustrates this problem directly.

7. Case Laws

Case 1 — OLG Wien, 15 R 149/25d, 11 December 2025

Direct crowdfunding authority

This case concerned an investor who had provided a €30,000 subordinated loan through a crowdfunding platform. The contractual maturity had passed and the investor sought repayment, including reliance on a guarantee from a company director.

A significant issue was international jurisdiction.

The Austrian court considered:

the investor's consumer status;

the platform's targeting of the Austrian market;

the crowdfunding activity;

the jurisdiction clause;

electronic transmission of contractual documents;

whether the business activity was directed toward Austria.

The court accepted that the circumstances could establish Austrian jurisdiction, including through the consumer-jurisdiction framework. It also considered an electronically transmitted jurisdiction clause in assessing the formal requirements. (RIS)

Principle

In cross-border crowdfunding:

Online availability alone is not necessarily the whole jurisdictional analysis; targeting a particular national market and the contractual structure are highly relevant.

Case 2 — OLG Linz, 4 R 15/25w, 5 March 2025

Direct crowdfunding/prospectus authority

This case involved a company that publicly offered qualified subordinated loans through a crowdfunding financing model for solar-thermal projects.

A consumer investor had entered into two €25,000 loan agreements.

The issue included whether the crowdfunding offer was subject to the applicable prospectus requirements and what consequences followed from the absence of the required prospectus.

The court considered the loans as investments within the applicable Austrian capital-markets framework and addressed the investor's statutory withdrawal and repayment consequences. (RIS)

Principle

A crowdfunding label does not remove ordinary capital-market and investor-protection requirements.

Where the law requires prescribed investment information or a prospectus, failure to comply may create withdrawal, restitution or liability consequences.

Case 3 — OGH, 4 Ob 233/22a, 31 May 2023

Directly relevant subordinated-loan authority

The Austrian Supreme Court considered a dispute involving a qualified subordinated loan.

The investor argued, among other things, that the contractual arrangement should not prevent repayment. The Supreme Court examined the nature and legal effect of the qualified-subordination clause.

The court treated the qualified subordination as an important element of the contractual structure rather than merely an ordinary limitation on payment. (RIS)

Principle

A properly agreed qualified-subordination clause can fundamentally determine the nature and repayment conditions of the investment.

Therefore:

Maturity + existence of debt ≠ automatic unconditional repayment.

The precise wording of the subordination clause is crucial.

Case 4 — OGH, 4 Ob 239/22h, 31 May 2023

This was a parallel Austrian dispute involving a €10,000 subordinated loan.

The contractual terms stated that repayment could not be demanded where repayment would cause an insolvency ground and that the investor ranked behind non-subordinated creditors.

The Supreme Court held that the mere contractual designation of the loan as a qualified subordinated loan did not automatically make the arrangement invalid. However, other allegations concerning:

unfairness;

deception;

inadequate information;

the role of an intermediary/adviser;

still required examination. (RIS)

Principle

A crowdfunding investment contract may survive a challenge to its basic structure, while separate misrepresentation, unfairness or information claims remain possible.

Case 5 — OGH, 17 Ob 18/24g, 18 December 2024

This case concerned a qualified subordinated loan and an investor's claim for repayment after the issuing company entered insolvency.

The Supreme Court dealt with procedural consequences of the issuer's insolvency and the investor's claim arising from the subordinated-loan contract. (RIS)

Principle

When a crowdfunding project owner becomes insolvent, the investor's contractual claim must be analysed together with:

insolvency law;

contractual subordination;

maturity;

ranking of creditors;

the insolvency administrator's role.

Thus, crowdfunding contractual rights cannot always be examined independently from insolvency law.

Case 6 — OGH, 7 Ob 164/24d, 20 November 2024

This case involved an investment through a qualified subordinated loan and an investor's claim concerning the prospectus and information surrounding the investment.

The issuing company had used a capital-markets prospectus, and the dispute involved the role and potential responsibility of a professional prospectus controller.

The Austrian Supreme Court considered whether the information contained in the prospectus had actually influenced the investor's investment decision. (RIS)

Principle

For an information-based damages claim, the court may need to examine causation:

Did the allegedly defective information actually cause the investment or the claimed loss?

This is important in crowdfunding because investors may receive information from several sources—platform pages, project documents, advisers and prospectuses.

8. Important Analogous CJEU Authorities

There is currently much more national European case law specifically concerning crowdfunding than direct CJEU crowdfunding judgments. Therefore, the following CJEU authorities should be described as analogous, not as crowdfunding cases.

Case 7 — Verein für Konsumenteninformation v Amazon EU, C-191/15

The CJEU considered online consumer contracts containing standard terms and a choice-of-law clause selecting the law of the trader's Member State.

The case concerned:

online contracting;

consumer protection;

choice of law;

unfair contractual terms;

cross-border transactions.

(InfoCuria)

Application to crowdfunding

A crowdfunding platform may have:

“This agreement is governed exclusively by the law of Country X.”

Such a clause does not automatically eliminate mandatory consumer protections available under EU law.

Case 8 — Verein für Konsumenteninformation v TVP, C-272/18

This CJEU case concerned investment/trust arrangements and standard contractual terms, including a contractual clause concerning applicable law and jurisdiction.

The underlying contractual arrangement involved investors and a professional undertaking operating across Austria and Germany. (EUR-Lex)

Application to crowdfunding

The case is useful for analysing:

standard investment contracts;

choice-of-law clauses;

jurisdiction clauses;

consumer status;

cross-border investment arrangements.

It demonstrates why courts should examine the substance and contractual structure, rather than merely the location of the online platform.

Case 9 — Kásler and Káslerné Rábai v OTP, C-26/13

The CJEU examined unfair terms in consumer credit contracts and stressed the importance of contractual transparency and the consequences of an unfair term. (InfoCuria)

Application to crowdfunding

A standard crowdfunding contract may contain complicated provisions concerning:

interest;

repayment;

subordination;

default;

fees;

conversion;

platform charges.

If the investor is a consumer, sufficiently clear and intelligible drafting becomes particularly important.

Case 10 — Océano Grupo Editorial, Joined Cases C-240/98 to C-244/98

The CJEU considered standard consumer contracts containing jurisdiction clauses.

It held that a non-negotiated jurisdiction clause could be unfair where it created a significant imbalance against the consumer, and recognised the importance of courts examining unfairness themselves. (InfoCuria)

Application to crowdfunding

A platform's standard terms should therefore not assume that an investor is bound by every jurisdiction clause merely because the investor clicked “accept”.

The consumer-protection framework may restrict such clauses.

9. Important Legal Issues in Crowdfunding Contract Disputes

10. Civil Liability of the Crowdfunding Platform

Platform liability generally requires identification of a specific legal duty.

Possible sources include:

Contractual duty

The platform may have promised to:

process payments;

maintain the platform;

provide particular information;

perform due diligence;

administer investments.

Failure may constitute breach of contract.

Statutory duty

Regulation 2020/1503 creates regulatory obligations concerning:

conduct of business;

due diligence;

complaints;

conflicts of interest;

investor information;

operational safeguards.

(EUR-Lex)

Tort/delict

National civil law may impose liability where negligent or intentional conduct causes loss.

11. Misleading Information

A common claim is:

“The project was presented as safe, but the investment was actually highly risky.”

The court should separate:

Fact

Example:

“The project has a secured mortgage over property.”

from:

Opinion

Example:

“This project is likely to be highly profitable.”

The first can usually be tested objectively.

The second may require analysis of whether it was presented as a factual representation or merely an opinion.

Under the EU crowdfunding framework, civil-liability rules must cover misleading or inaccurate information and material omissions in the Key Investment Information Sheet. (EUR-Lex)

12. Qualified Subordination

This is one of the most important issues.

Suppose:

Investor lends €20,000 for five years.

The contract states:

repayment cannot be demanded if payment would cause or contribute to insolvency.

The project fails.

The investor cannot necessarily argue simply:

“Five years have expired, therefore I must immediately receive €20,000.”

The court may need to determine:

whether the clause is valid;

what exactly triggers subordination;

whether the trigger has occurred;

whether the project owner is actually insolvent;

whether payment would create an insolvency ground;

whether the clause applies after insolvency;

whether the investor has another remedy for misrepresentation.

The Austrian Supreme Court's crowdfunding-related subordinated-loan jurisprudence is particularly useful here. (RIS)

13. Consumer Protection

Where the investor is a consumer, additional protection may arise from EU consumer law.

Important questions include:

Was the clause individually negotiated?

Is the clause transparent?

Does it create a significant imbalance?

Is the investor clearly informed about the risk?

Is the jurisdiction clause unfair?

Is the choice-of-law clause compatible with mandatory consumer protections?

Océano Grupo and Kásler are particularly useful general authorities. (InfoCuria)

14. Cross-Border Choice of Law

A crowdfunding contract might state:

“This agreement is governed by German law.”

But the investor might live in France and the platform might operate from Germany.

The court must consider:

Rome I;

consumer protections;

mandatory provisions;

the actual contractual relationship;

whether the investor qualifies as a consumer;

whether the choice-of-law clause is valid.

Amazon, C-191/15, is useful by analogy because the CJEU dealt with an online trader's choice-of-law clause in standard consumer terms. (InfoCuria)

15. Jurisdiction Clauses

A crowdfunding platform may state:

“All disputes shall be decided exclusively by the courts of the platform's registered office.”

That does not necessarily end the jurisdiction analysis.

The court may examine:

whether the investor is a consumer;

whether the clause was individually negotiated;

whether applicable EU jurisdiction rules protect the investor;

whether the clause is unfair.

Océano Grupo is an important authority on this general problem. (InfoCuria)

16. Insolvency of the Project Owner

This is one of the most serious crowdfunding disputes.

If the project owner becomes insolvent, investors may become unsecured or subordinated creditors.

The result depends on:

the contract;

ranking of the debt;

insolvency legislation;

security;

guarantees;

subordination;

maturity;

whether the investment is debt or equity.

The Austrian cases demonstrate why contractual classification and insolvency ranking must be examined together. (RIS)

17. Remedies

Depending on the facts and applicable national law, an investor may seek:

1. Repayment

Return of the principal.

2. Contractual interest

Interest expressly agreed in the contract.

3. Default interest

Where legally recoverable.

4. Damages

For losses caused by breach, misrepresentation or statutory violations.

5. Rescission/withdrawal

Where permitted by applicable legislation.

6. Restitution

Restoration of money or other benefits transferred under an invalid or rescinded contract.

7. Declaration of liability

A court may declare that the platform, project owner, adviser or guarantor is liable.

8. Injunction

Particularly relevant for misleading or unlawful platform practices.

18. Defences Available to Project Owners or Platforms

A defendant may argue:

no contractual relationship existed with the investor;

the platform was merely an intermediary;

the investment risk was clearly disclosed;

the loss resulted from ordinary commercial risk;

the subordination clause prevents repayment;

the claimant was not entitled to repayment yet;

the information was accurate;

there was no causation;

the claimant failed to prove loss;

the claim is time-barred;

the jurisdiction clause is valid;

another country's law governs;

insolvency law prevents individual repayment;

the alleged loss was caused by market conditions rather than the defendant's conduct.

19. Special Importance of the Contract Structure

A crowdfunding dispute should be analysed in layers:

Layer 1 — Platform contract

Investor ↔ Platform

Layer 2 — Investment contract

Investor ↔ Project owner/issuer

Layer 3 — Payment relationship

Investor ↔ Payment service provider/bank

Layer 4 — Security

Investor ↔ Guarantor/security provider

Layer 5 — Corporate relationship

Project owner ↔ shareholders/directors

Layer 6 — Insolvency

Investor ↔ insolvency estate

A mistake at any one layer can lead to the wrong defendant or wrong remedy.

20. Key Principles from the Case Law

Principle 1

Crowdfunding does not eliminate ordinary contract law.

The investment remains governed by contractual principles together with applicable financial-services legislation.

Principle 2

The platform is not automatically liable for project-owner default.

Its liability depends on its own contractual and statutory duties.

Principle 3

Subordination clauses can fundamentally affect repayment rights.

The wording of the clause is crucial. (RIS)

Principle 4

Investor information can create civil liability.

Misleading or materially incomplete investment information can produce statutory or civil consequences. (EUR-Lex)

Principle 5

Consumer protection can restrict standard terms.

Unfair jurisdiction, choice-of-law or substantive clauses may be challenged. (InfoCuria)

Principle 6

Cross-border crowdfunding requires a separate jurisdiction and applicable-law analysis.

The location of the website alone does not answer the question.

Principle 7

Insolvency and contract law interact.

A contractual repayment right may be affected by subordination and insolvency law.

Principle 8

Causation is essential for damages.

An inaccurate statement does not automatically establish the entire claimed loss; the claimant may need to demonstrate that the defect caused the investment or loss.

21. Six Most Useful Cases for an Exam

Additional highly useful authorities are OGH 7 Ob 164/24d, Kásler C-26/13, Océano Grupo C-240/98 to C-244/98, and Verein für Konsumenteninformation v TVP C-272/18. (RIS)

22. Simple Example

A French consumer invests €10,000 through a German crowdfunding platform in an Italian real-estate project.

The project fails.

The investor claims:

“The platform told me that the investment was secure.”

The project owner says:

“The contract was a qualified subordinated loan and repayment is restricted.”

The platform says:

“We were only an intermediary.”

A European court may have to determine:

Was the investor a consumer?

Who was the contractual borrower?

What did the platform promise?

Was the investment information accurate?

Was the subordination clause valid and applicable?

Which law governs the contract?

Which court has jurisdiction?

Did the platform breach a statutory duty?

Did the alleged misrepresentation cause the loss?

Does insolvency law restrict repayment?

This illustrates why crowdfunding disputes are multi-layered contractual disputes, rather than simple claims for repayment.

23. Exam Formula

For an examination answer, use:

Crowdfunding Contract → Parties → Contract Formation → Platform Duties → Investor Information → Subordination → Consumer Protection → Jurisdiction → Applicable Law → Insolvency → Breach → Causation → Damages → Remedies.

24. Ultra-Short Revision Notes

Crowdfunding = online financing by many investors.

Two principal forms = lending-based + investment-based.

Main EU legislation = Regulation 2020/1503.

Platform must act honestly, fairly and professionally.

Due diligence is required.

Complaint procedures are required.

Conflicts of interest must be controlled.

Non-sophisticated investors receive a reflection period.

KIIS information can create civil liability.

Qualified subordination can restrict repayment.

Platform ≠ automatically borrower.

Consumer status is important.

Unfair standard terms can be challenged.

Choice-of-law clauses require careful examination.

Jurisdiction clauses may be restricted by consumer law.

Insolvency can change the practical value of contractual rights.

Damages generally require breach + loss + causation.

Cross-border disputes require analysis under Brussels I bis + Rome I + applicable consumer/financial law.

Conclusion

Crowdfunding contractual disputes in Europe are governed by a combination of ordinary civil/contract law, EU crowdfunding regulation, consumer protection, private international law, financial-market rules and insolvency law. Regulation 2020/1503 provides the central EU regulatory framework, while national courts remain particularly important for disputes concerning repayment, subordinated loans, misrepresentation and investor liability. (EUR-Lex)

The most important practical question is usually not simply whether the investor lost money, but which contractual relationship created the loss, what obligations each participant assumed, whether mandatory investor-protection rules were breached, and whether the contract's repayment or subordination provisions are enforceable.