10 Amendments of Thomas MANN related to 2011/0361(COD)
Amendment 132 #
Proposal for a regulation
Recital 17
Recital 17
(17) The new rules limiting the duration of the business relationship between an issuer and the credit rating agency would significantly reshape the credit rating market in the Union, which today remains largely concentrated. New market opportunities would arise for small and mid-size credit rating agencies, which would need to develop to take up those challenges in the first years following the entry into force of the new rules. Those developments are likely to bring new diversity into the market. The objectives and the effectiveness of the new rules would, however, be largely jeopardised if, during these initial years, large established credit rating agencies would prevent their competitors from developing credible alternatives by acquiring them. Further consolidation in the credit rating market driven by large established players would result in a reduction of the number of available registered credit rating agencies, thus creating selection difficulties for issuers at the moment in which they regularly need to appoint one or more new credit rating agencies and disturbing the smooth functioning of the new rules. More importantly, further consolidation driven by large established credit rating agencies would particularly prevent the emergence of more diversity in the market. In this context, appropriate incentives to encourage market players to enter this market should be discussed. A rotation rule and barriers to consolidation over the next few years are unlikely to prove sufficient to generate the desired competition in this market.
Amendment 147 #
Proposal for a regulation
Recital 20
Recital 20
(20) Due to the complexity of structured finance instruments, credit rating agencies have not always succeeded in ensuring a sufficiently high quality of credit ratings issued on such instruments. This has led to a loss of market confidence in this type of credit ratings. In order to regain confidence it would be appropriate to require issuers or their related third parties to engage two different credit rating agencies for the provision of credit ratings on structured finance instruments, which could lead to different and competing assessments. This could also reduce the over-reliance on a single credit rating. Since it is particularly important to have quality standards for credit ratings, the introduction of a general, periodic quality review of rating agencies should be discussed in order to avoid in future the errors in credit ratings referred to above, which can be attributed to a lack of competence.
Amendment 154 #
Proposal for a regulation
Recital 23
Recital 23
(23) Investors, issuers and other interested parties should have access to up to date rating information on a central webpage and receive access to future data transmission channels. A European Rating Index (EURIX) established by ESMA should allow investors to easily compare all ratings that exist with regard to a specific rated entity and provide them with average ratings. In order to enable investors to compare ratings on the same entity issued by different credit rating agencies it is necessary that credit rating agencies use a harmonised rating scale, to be developed by ESMA and adopted by the Commission as a regulatory technical standard. The use of the harmonised rating scale should only be mandatory for the publication of the ratings on the EURIX webpage while credit rating agencies should be free to use their own rating scales when publishing the ratings on their own websites. The mandatory use of a harmonised rating scale should not have a harmonising effect on methodologies and processes of credit rating agencies, but should be limited to making the rating outcome comparable. It is important that the EURIX webpage shows, in addition to an aggregate rating index, all available ratings per instrument in order to allow investors to consider the whole variety of opinions before taking their own investment decision. The aggregate rating index may help investors to get a first indication of the creditworthiness of an entity. The EURIX should help smaller and new credit rating agencies to gain visibility. The European Rating Index would complement the information on historical performance data to be published by credit rating agencies in ESMA's central repository. The European Parliament supported the establishment of such European Rating Index in its resolution on credit rating agencies of 8 June 2011.
Amendment 182 #
Proposal for a regulation
Recital 30
Recital 30
(30) In order to contribute to the issuance of up to date and credible sovereign ratings and to facilitate users' understanding, it is important to regularly review ratings. In order to make ratings easier to understand, an overview should be provided - in addition to regular controls - enabling users to understand how ratings are made. It is also important to increase the transparency about the research work carried out, the staff allocated to the preparation of ratings and the underlying assumptions behind the credit ratings made by credit rating agencies in relation to sovereign debt.
Amendment 252 #
Proposal for a regulation
Article 1 – point 8
Article 1 – point 8
Regulation (EC) No 1060/2009
Article 6b – paragraph 1
Article 6b – paragraph 1
(1) Where a credit rating agency has entered into a contract with an issuer or its related third party for the issuing of credit ratings on that issuer, it shall not issue credit ratings on that issuer for a period exceeding threfive years.
Amendment 255 #
Proposal for a regulation
Article 1 – point 8
Article 1 – point 8
Regulation (EC) No 1060/2009
Article 6b – paragraph 2 – point a
Article 6b – paragraph 2 – point a
a) when those credit ratings are issued within a period exceeding an initial period of twelve months but shorter than threfive years, the credit rating agency shall not issue any further credit ratings on those debt instruments from the moment that ten debt instruments have been rated;
Amendment 258 #
Proposal for a regulation
Article 1 – point 8
Article 1 – point 8
Regulation (EC) No 1060/2009
Article 6b – paragraph 2 –point c
Article 6b – paragraph 2 –point c
c) when less than ten credit ratings are issued, the credit rating agency shall not issue any further credit ratings on those debt instruments from the moment a period of threfive years have elapsed..
Amendment 278 #
Proposal for a regulation
Article 1 – point 10 – point c
Article 1 – point 10 – point c
Regulation (EC) No 1060/2009
Article 8 – paragraph 5a – subparagraph 1
Article 8 – paragraph 5a – subparagraph 1
5a. A credit rating agency that intends to change or use any new rating methodologies, models or key rating assumptions shall publish the proposed changes or proposed new methodologies on its website inviting stakeholders to submit comments for a period not shorter than one monthof six weeks, together with a detailed explanation of the reasons for and the implications of the proposed changes or proposed new methodologies.
Amendment 282 #
Proposal for a regulation
Article 1 – point 10 – point c
Article 1 – point 10 – point c
Regulation (EC) No 1060/2009
Article 8 – paragraph 5a – subparagraph 2
Article 8 – paragraph 5a – subparagraph 2
Amendment 325 #
Proposal for a regulation
Article 1 – point 14
Article 1 – point 14
Regulation (EC) No 1060/2009
Article 11a – paragraph 2
Article 11a – paragraph 2
(2) ESMA shall establish a European Rating Index which will include all credit ratings submitted to ESMA pursuant to paragraph 1 and an aggregated rating index for any rated debt instrument. The index and individual credit ratings shall be published on ESMA’s website. and made available as data feed. .