[ParlTrack]

Proposal for a regulation
Recital 1

(1) Regulation (EC) No 1060/2009 of the European Parliament and of the Council of 16 September 2009 on credit rating agencies requires credit rating agencies to comply with rules of conduct in order to mitigate possible conflicts of interest, ensure high quality and sufficient transparency of ratings and the rating process. Following the amendments introduced by Regulation (EU) No 513/2011 of the European Parliament and of the Council, the European Securities and Markets Authority (ESMA) has been empowered to register and supervise credit rating agencies. This amendment complements the current regulatory framework for credit rating agencies. Some of the issues addressed (conflicts of interests due to the issuer-pays model, disclosure for structured finance instruments) had been identified, but not fully resolved by the existing rules. The need to review transparency ~~and~~, procedural requirements and the timing of the publication specifically for sovereign ratings was highlighted by the current sovereign debt crisis.

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 3 a (new)

(3a) The European Central Bank bases its decision on marketable assets for collateral regarding the liquidity providing operations on the Eurosystem credit assessment framework (ECAF). The ECAF primarily uses external credit ratings from the list of registered ECAI, which is limited in number to only four credit rating agencies. The European Central Bank should revise this practice and at least align and widen its pool of external credit ratings to the ESMA approved credit rating agencies within the Union. Furthermore, both the European Central Bank as well as national central banks are well advised to review their use of external ratings, and to build up expertise in devising their own models to assess the credit standard of eligible assets used as collateral for liquidity-providing operations, and to reduce their reliance on external ratings in general.

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 3 b (new)

(3b) The Commission should establish a horizontal measure that assesses the reference to credit ratings in national law whether based on the implementation of Union law or not and where such reference triggers mechanistic reliance on credit ratings by competent authorities or financial market participants such reference shall be reviewed and removed in a reasonable timeframe.

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 6

(6) Regulation (EC) No 1060/2009 already provided a first round of measures to address the question of independence and integrity of credit rating agencies and their credit rating activities. The objectives of guaranteeing the independence of credit rating agencies and of identifying, managing and, to the extent possible, avoiding any conflict of interest that could arise were already underlying several provisions of that Regulation in 2009. ~~Whilst providing a sound basis, the existing rules do not appear to have had a sufficient impact in this regard.~~ Credit rating agencies still are not perceived as sufficiently independent actors. The selection and remuneration of the credit rating agency by the rated entity (issuer- pays model) engenders inherent conflicts of interest, which are insufficiently addressed by the existing rules. Under this model, there are incentives for credit rating agencies to issue complacency ratings on the issuer in order to secure a long-standing business relationship guaranteeing revenues or in order to secure additional work and revenues. Moreover, relationships between the shareholders of credit rating agencies and the rated entities may cause conflicts of interest which are not sufficiently dealt with by the existing rules. As a result, credit ratings issued under the issuer-pays model may be perceived as the credit ratings that suit the issuer rather than the credit ratings needed by the investor. Without prejudice to the conclusions of the report to be submitted by the Commission on the issuer-pays model by December 2012 pursuant to Article 39(1) of Regulation (EC) No 1060/2009, it is essential to reinforce the conditions of independence applying to credit rating agencies in order to increase the level of credibility of credit ratings issued under the issuer-pays model.

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 7

(7) The credit rating market shows that, traditionally, credit rating agencies and rated entities enter into long-lasting relationships. This raises the threat of familiarity, as the credit rating agency may become too sympathetic to the desires of the rated entity. In those circumstances, the impartiality of credit rating agencies over time could become questionable. Indeed, credit rating agencies mandated and paid by a corporate issuer are incentivised to issue overly favourable ratings on that rated entity or its debt instruments in order to maintain the business relationship with such issuer. Issuers are also subject to incentives that favour long-lasting relationships, such as the lock-in effect: an issuer may refrain from changing credit rating agency as this may raise concerns of investors regarding the issuer's creditworthiness. This problem was already identified in Regulation (EC) No 1060/2009, which required credit rating agencies to apply a rotation mechanism providing for gradual changes in analytical teams and credit rating committees so that the independence of the rating analysts and persons approving credit ratings would not be compromised. The success of those rules, however, was highly dependant on a behavioural solution internal to the credit rating agency: the actual independence and professionalism of the employees of the credit rating agency vis- à-vis the commercial interests of the credit rating agency itself. These rules were not designed to provide sufficient guarantee towards third parties that the conflicts of interest arising from the long-lasting relationship would effectively be mitigated or avoided. It therefore appears necessary to provide for a structural response having a higher impact on third parties. This could be achieved effectively by limiting the period during which a credit rating agency can continuously provide credit ratings on the same issuer or its debt instruments. Setting out a maximum duration of the business relationship between the issuer which is rated or which issued the rated debt instruments and the credit rating agency should remove the incentive for issuing favourable ratings on that issuer. Additionally, requiring the rotation of credit rating agencies as a normal and regular market practice should also effectively address the lock-in effect, where an issuer refrains from changing credit rating agency as this would raise concerns of investors regarding the issuer's creditworthiness. Finally, the rotation of credit rating agencies should have positive effects on the rating market as it would facilitate new market entries and offer existing credit rating agencies the opportunity to extend their business to new areas.deleted

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 8

(8) Regular rotation of credit rating agencies issuing credit ratings on an issuer or its debt instruments should bring more diversity to the evaluation of the creditworthiness of the issuer that selects and pays that credit rating agency. Multiple and different views, perspectives and methodologies applied by credit rating agencies should produce more diverse credit ratings and ultimately improve the assessment of the creditworthiness of the issuers. For this diversity to play a role and to avoid complacency of both issuers and credit rating agencies, the maximum duration of the business relationship between the credit rating agency and the issuer paying must be restricted to a level guaranteeing regular fresh looks at the creditworthiness of issuers. Therefore, a time period of three years would seem appropriate, also considering the need to provide certain continuity within the credit ratings. The risk of conflict of interest increases in situations where the credit rating agency frequently issues credit ratings on debt instruments of the same issuer within a short period of time. In those cases, the maximum duration of the business relationship should be shorter to guarantee similar results. Hence, the business relationship should stop after a credit rating has rated ten debt instruments of the same issuer. However, in order to avoid imposing a disproportionate burden on issuers and credit rating agencies, no requirement to change credit rating agency within the first 12 months of the business relationship should be imposed. Where an issuer mandates more than one credit rating agency, either because as an issuer of structured finance instruments he is obliged to do so, or on a voluntary basis, it should be sufficient that the strict rotation periods only apply to one of the credit rating agencies. However, also in this case, the business relationship between the issuer and the additional credit rating agencies should not exceed a period of six years.deleted

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 9

(9) The rule requiring rotation of credit rating agencies needs to be enforced in a credible manner to be meaningful. The rotation rule would not achieve its objectives if the outgoing credit rating agency were allowed to provide rating services to the same issuer again within a too short period of time. Therefore, it is important to provide for an appropriate period within which such credit rating agency may not be mandated by the same issuer to provide rating services. That period should be sufficiently long to allow the incoming credit rating agency to effectively provide its rating services to the issuer, to ensure that the issuer is truly exposed to a new scrutiny under a different approach and to guarantee that the credit ratings issued by the new credit rating agency provide enough continuity. That period should allow that an issuer cannot rely on comfortable arrangements with only two credit rating agencies that would replace each other on a continuous basis, as this could lead to maintaining the familiarity threat. Hence, the period during which the outgoing credit rating agency should not provide rating services to the issuer should generally be set at four years.deleted

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 10

(10) The change of credit rating agency inevitably increases the risk that knowledge about the rated entity acquired by the outgoing rating agency is lost. As a result, the incoming credit rating agency would have to make considerable efforts to acquire the knowledge necessary to carry out its work. However, a smooth transition should be ensured by establishing a requirement on the outgoing credit rating agency to transfer relevant information on the rated entity or instruments to the incoming credit rating agency.deleted

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 11

(11) Requiring issuers to regularly change the credit rating agency they mandate to issue credit ratings is proportionate to the objective pursued. This requirement only applies to certain regulated institutions (registered credit rating agencies) which provide a service affecting the public interest (credit ratings that can be used for regulatory purposes) under certain conditions (issuer-pays model). The privilege of having its services recognised as playing an important role in the regulation of the financial services market and being approved to carry out this function, entails the need to respect certain obligations in order to guarantee independence and the perception of independence in all circumstances. A credit rating agency which is prevented from providing credit rating services to a particular issuer would still be allowed to provide credit ratings to other issuers. In a market context where the rotation rule applies to all players, business opportunities will arise since all issuers would need to change credit rating agency. Moreover, credit rating agencies may always issue unsolicited credit ratings on the same issuer, capitalising on their experience. Unsolicited ratings are not constrained by the issuer-pays model and therefore are less affected by potential conflicts of interests. For issuers, the maximum duration of the business relationship with a credit rating agency or the rule on the employment of more than one credit rating agency also represents a restriction on their freedom to conduct their own business. However, this restriction is necessary on public- interest grounds considering the interference of the issuer-pays model with the necessary independence of credit rating agencies to guarantee independent credit ratings that can be used by investors for regulatory purposes. At the same time, these restrictions do not go beyond what is necessary and should rather be seen as an element increasing the issuer's creditworthiness towards other parties, and ultimately the market.deleted

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 12

(12) One of the specificities of sovereign ratings is that the issuer-pays model generally does not apply. Instead, the majority of ratings are produced as unsolicited ratings, providing the basis for both solicited and unsolicited ratings of the financial institutions of the country concerned. It is therefore not necessary to require the rotation of credit rating agencies issuing sovereign ratings.deleted

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 13

(13) The independence of a credit rating agency vis-à-vis a rated entity is also affected by possible conflict of interests of any of its significant shareholders with the rated entity: A shareholder of a credit rating agency could be a member of the administrative or supervisory board of a rated entity or a related third party. The rules of Regulation (EC) No 1060/2009 addressed this type of situation only as regards the conflicts of interest caused by rating analysts, persons approving the credit ratings or other employees of the credit rating agency. The Regulation was, however, silent as regards potential conflicts of interest caused by shareholders or members of credit rating agencies. With a view to enhancing the perception of independence of credit rating agencies vis- à-vis the rated entities, it is appropriate to extend the existing rules applying to conflicts of interest caused by employees of the credit rating agencies also to those caused by shareholders or members holding a significant position within the credit rating agency. Hence, the credit rating agency should ~~abstain from issuing credit ratings, or should~~immediately disclose that the credit rating may be affected, where a shareholder or member holding 10% of the voting rights of that agency is also a member of the administrative or supervisory board of the rated entity or has invested in the rated entity. Moreover, where a shareholder or member is in a position to significantly influence the business activity of the credit rating agency, that person should ~~not provide~~ disclose any consultancy or advisory services rendered to the rated entity or a related third party regarding its corporate or legal structure, assets, liabilities or activities.

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 14

(14) The rules on independence and prevention of conflicts of interest, could become ineffective if credit rating agencies were not independent from each other. A sufficiently high number of credit rating agencies, unconnected with both the outgoing credit rating agency in case of rotation and with the credit rating agency providing credit rating services in parallel to the same issuer, is necessary for a workable application of those rules. In the absence of sufficient choice of credit rating agencies for the issuer in the current market, the implementation of these rules aimed at enhancing independence conditions would risk becoming ineffective. Therefore, it is appropriate to require a strict separation of the outgoing agency from the incoming credit rating agency in case of rotation as well as of the two credit rating agencies providing rating services in parallel to the same issuer. The credit rating agencies concerned should not be linked to each other by control, by being part of the same group of credit rating agencies, by being shareholder or member of or being able to exercise voting rights in any of the other agencies, or by being able to appoint members of the administrative, management or supervisory boards of any of the other credit rating agencies.deleted

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 14 a (new)

(14a) Possible mergers of registered credit rating agencies, in particular those involving a large agency, would result in reducing the issuers' possibility to choose between different agencies in the market, and in the disappearance of competitors. This is likely to create difficulties for issuers at the moment in which they need to appoint one or more new credit rating agencies. Therefore, it is appropriate to ban mergers between large credit rating agencies and their competitors.

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 15

(15) The perception of independence of credit rating agencies would be particularly affected should the same shareholders or members be investing in different credit rating agencies not belonging to the same group of credit rating agencies~~, at least if this investment reaches a certain size that could allow these shareholders or members to exercise a certain influence on the agency's business~~. Therefore, in order to ensure the independence (and the perception of independence) of credit rating agencies, it is appropriate to provide for stricter rules regarding the relations between the credit rating agencies and their shareholders. For this reason, ~~no person s~~a sharehould ~~simultaneously~~er or member holding a participation of 5% or more in ~~more than one~~one credit rating agency should not be allowed to hold any participation in another credit rating agency, unless the agencies concerned belong to the same group.

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 16

(16) The objective of ensuring sufficient independence of credit rating agencies entails that investors should not hold ~~simultaneously~~an investments of 5 % or more in ~~more than one~~one credit rating agency and simultaneously be invested in another credit rating agency. Directive 2004/109/EC of the European Parliament and of the Council of 15 December 2004 on the harmonisation of transparency requirements in relation to information about issuers whose securities are admitted to trading on a regulated market requests that those persons controlling 5% of the voting rights in a listed company results should disclose it to the public, because, inter alia, of the interest for investors to know about changes in the voting structure of such company. 5% of the voting rights is considered therefore to be a major holding capable of influencing the voting structure in a company. It is therefore appropriate to use the 5% level for the purposes of restricting the ~~simultaneous~~ investment in more than one credit rating agency. This measure cannot be considered disproportionate, given that all registered credit rating agencies in the Union are non- listed undertakings therefore not subject to the transparency and procedural rules that apply to listed companies in the EU. Often unlisted undertakings are governed by shareholders' protocols or agreements and the number of shareholders or members is usually low. Therefore, even a minority position in an unlisted credit rating agency could be influential. Nevertheless, in order to ensure that purely economic investments in credit rating agencies are still possible, this limitation to simultaneously investments in more than one credit rating agency should not be extended to investments channelled though collective investment schemes managed by third parties independent from the investor and not subject to his or her influence.

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
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~~market. More importantly, further consolidation driven by large established credit rating agencies would particularly prevent the emergence of more diversity in the market.

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 18

(18) The effectiveness of the rules on independence and prevention of conflict of interest which require that credit rating agencies should not provide for a long period of time credit rating services to the same issuer could be undermined if credit rating agencies where allowed to become directly or indirectly shareholders or members of other credit rating agencies.deleted

2012/04/17
Committee: ECON

Wolf KLINZ

Proposal for a regulation
Recital 19

(19) It is important to ensure that modifications to the rating methodologies do not result in less rigorous methodologies. For that purpose, issuers, investors and other interested parties should have the opportunity to comment on any intended change of rating methodologies. This will help them to understand the reasons behind new methodologies and for the change in question. Comments provided by issuers and investors on the draft methodologies may provide valuable input for the credit rating agencies in defining the methodologies. Moreover, ESMA should ~~verify~~have the possibility to check and confirm the compliance of new rating methodologies with Article 8(3) of Regulation (EC) No 1060/2009 and the relevant regulatory technical standard before methodologies are applied in practice within one month. ESMA should ~~verify~~only check that the proposed methodologies are rigorous, systematic, continuous and subject to validation based on historical experience, including back- testing. However, this verification process should not grant ESMA any power to judge the appropriateness of the proposed methodology or the content of the credit ratings issued following the application of the methodologies. ESMA should under no circumstances interfere with the content of methodologies or the resulting credit rating, but simply perform a check that the relevant procedures have been followed. This ex-ante check shall be without prejudice to ESMA's ongoing supervisory duties.

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 21

(21) Directive xxxx/xx/EU of the European Parliament and of the Council of […] on the access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms19 has introduced a provision requiring banks and investment firms to assess the credit risk of entities and financial instruments in which they invest themselves and not to simply rely in this respect on external ratings. This rule should be extended to other financial firms regulated under Union law, including investment managers. Member States should not be entitled to impose rules that allow stricter reliance of these investors on external ratings. Furthermore, Member States should revise their national rules and technical standards to eliminate the reference to credit ratings where they trigger mechanic reliance on credit ratings. Member States should also review all references to specific credit ratings in order to take into account all registered and certified rating agencies.

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 23

(23) Investors, issuers and other interested parties should have access to up to date rating information on a central webpage and via data feeds. 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 in cooperation with EBA and EIOPA 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. Credit ratings agencies that work on a subscription- or investor-based payment model shall be exempt from the publication of individual credit ratings and should only feature in the establishment of the average ratings. 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.

2012/04/17
Committee: ECON

Wolf KLINZ

Proposal for a regulation
Recital 25

(25) Credit rating agencies should only be held liable if ESMA deems that they infringe intentionally or with gross negligence any obligations imposed on them by Regulation (EC) No 1060/2009. This standard of fault means that credit rating agencies should not face liability claims if they neglect individual obligations under the Regulation without disregarding their duties in a serious way. This standard of fault is appropriate because the activity of credit rating involves a certain degree of assessment of complex economic factors and the application of different methodologies may lead to different rating results, non of which can be qualified as incorrect.

2012/04/17
Committee: ECON

Wolf KLINZ

Proposal for a regulation
Recital 26

(26) It is important to provide investors and issuers with an effective right of redress against credit rating agencies. As investors and issuers do not have close insight in internal procedures of credit rating agencies a partial reversal of the burden of proof with regard to the existence of an infringement and the infringement's impact on the rating outcome seems to be appropriate if the investor has made a reasonable case in favour of the existence of such an infringementthey should first address their reasonable case in favour of the existence of an infringement to ESMA for the establishment of such an infringement case. After such establishment the investor or issuer should refer to the applicable national courts to claim its right of redress. However, the burden of proof as regards the existence of a damage and the causality of the infringement for the damage, both being closer to the sphere of the investor/issuer, should fully be on the investor/issuer.

2012/04/17
Committee: ECON

Wolf KLINZ

Proposal for a regulation
Recital 27

(27) In view of the national differences in Member States' civil law, particular care should be taken with regard to the definition of the applicable jurisdiction. Regarding matters concerning the civil liability of a credit rating agency and which are not covered by this regulation, such matters should be governed by the applicable national law determined by the relevant rules of International Private Law. The competent court to decide on a claim for civil liability brought by an investor should be determined by the relevant rules on International Jurisdiction.

2012/04/17
Committee: ECON

Wolf KLINZ

Proposal for a regulation
Recital 32

(32) In view of the specificities of sovereign ratings and in order to reduce the risk of volatility, it is appropriate to require credit rating agencies to only publish these ratings according to a pre-defined calendar at the choice of the credit rating agency and to require the publication only on Fridays after the close of business of the trading venues established in the Union. Only in exceptional circumstances may a credit rating agency deviate from its self-prescribed sovereign rating calendar, in such cases it shall only publish these ratings after the close of business of the trading venues established in the Union and at least one hour before their opening.

2012/04/17
Committee: ECON

Wolf KLINZ

Proposal for a regulation
Recital 32 a (new)

(32a) A fully independent European credit rating foundation (ECRaF) should be established in order to foster competition; welcomes in this respect any promising truly independent private market initiative in this respect and hopes that the market will embrace a new entrant in the sector;

2012/04/17
Committee: ECON

Wolf KLINZ

Proposal for a regulation
Recital 32 b (new)

(32b) Welcomes any initiative by smaller credit rating agencies to establish a network of European credit rating agencies, either in partnership or joint- network structures, in order to draw on existing resources and staffing, enabling them to provide increased coverage and allowing them to compete with large credit rating agencies that are active at cross-border and global level.

2012/04/17
Committee: ECON

Wolf KLINZ

Proposal for a regulation
Recital 32 c (new)

(32c) Reiterates that credit ratings of credit rating agencies established in a third country may be used within the Union on condition that those ratings are confirmed by a credit rating agency established in the Union and registered in accordance with this Regulation.

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Recital 34

(34) The Commission should adopt the draft regulatory technical standards developed by ESMA regarding ~~the content of the handover file when a credit rating agency is replaced by another credit rating agency,~~ the content, frequency and presentation of the information to be provided by issuers on structured finance instruments, harmonisation of the standard rating scale to be used by credit rating agencies, the presentation of the information, including structure, format, method and timing of reporting, that credit rating agencies should disclose to ESMA in relation to EURIX and the content and format of the periodic reporting on fees charged by credit rating agencies for the purposes of ongoing supervision by ESMA. The Commission should adopt those standards by means of delegated acts pursuant to Article 290 of the Treaty and in accordance with Articles 10 to 14 of Regulation (EU) No 1095/2010.

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS

Proposal for a regulation
Article 1 – point 6

Regulation (EC) No 1060/2009
Article 5b – paragraph 1

The European Supervisory Authority (European Banking Authority) established by Regulation (EU) No 1093/2010 of the European Parliament and of the Council (*) (EBA), the European Supervisory Authority (European Insurance and Occupational Pensions Authority) established by Regulation (EU) No 1094/2010 of the European Parliament and of the Council (**) (EIOPA) and ESMA shall not refer to credit ratings in their guidelines, recommendations and draft technical standards where such references have the potential to trigger mechanistic reliance on credit ratings by competent authorities or financial market participants. Accordingly, and at the latest by ~~31 December 2013~~...*, EBA, EIOPA and ESMA shall review and remove where appropriate all references to credit ratings in existing guidelines and recommendations where such references have the potential to trigger mechanistic reliance on credit ratings. Furthermore, EBA, EIOPA and ESMA shall review references to specific credit ratings in order to take into account all registered and certified credit rating agencies in existing guidelines and recommendations. ______________ * OJ please insert date: three years after the date of entry into force.

2012/04/17
Committee: ECON

Wolf KLINZ, Jean-Paul GAUZÈS