Regulatory regime for credit rating agencies

The following Financial Services practice note provides comprehensive and up to date legal information covering:

  • Regulatory regime for credit rating agencies
  • EU CRA Regulation—background
  • Brexit—onshoring of EU CRA Regulation
  • Key definitions
  • Credit ratings
  • Credit rating agencies and credit rating activities
  • Competent authorities
  • Registration and certification of credit rating agencies—EU CRA Regulation
  • Obligation to register
  • Certification
  • More...

Regulatory regime for credit rating agencies

In each section of this Practice Note, links are given to the relevant provisions of EU and/or UK legislation, as applicable, and significant divergence between relevant EU and UK legislation is indicated.

EU CRA Regulation—background

The Credit Rating Agencies Regulation (EC) 1060/2009 (OJ L 302/1) (the EU CRA Regulation) is the core EU legislation relating to credit rating agencies (CRAs) and credit ratings. It was developed to address issues relating to CRAs that became apparent in the financial crisis of 2007/08. It was based on the standards prescribed in the Code of Conduct Fundamentals for CRAs (IOSCO CRA Code) published by the International Organization of Securities Commissions (IOSCO). The IOSCO CRA Code of Conduct was most recently revised by IOSCO in March 2015 (Code of Conduct Fundamentals for Credit Rating Agencies Final Report March 2015), please refer to Credit Rating Agencies: International Standards Part I for further information. For further information on IOSCO, please refer to Practice Note: International Organization of Securities Commissions (IOSCO). The general market view is that the EU CRA Regulation’s requirements are stricter than those set out in the IOSCO CRA Code.

The EU CRA Regulation was subsequently amended by Regulation (EU) 513/2011 (OJ L 145/30) (EU CRA II Regulation) and Regulation (EU) 462/2013 (OJ L 146/1) (EU CRA III Regulation). The EU CRA II Regulation transferred responsibility for the

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