ESMA Issues First Drafts Of Binding Standards For Credit Rating Agencies

ESMA publishes today for consultation its first set of proposed future Regulatory Technical Standards (RTS). The draft RTSs on Credit Rating Agencies (CRAs) detail the information that CRAs would have to disclose and the rules they would have to comply with in order to fulfil the requirements of the CRA Regulation. ESMA is seeking stakeholders’ views in respect of specific technical issues specified under Article 21 (4) of the CRA Regulation by October 21, 2011. The potential costs and benefits of the future standards will also be assessed by ESMA. 

The proposals of draft RTS published today in ESMA’s consultation paper cover the following technical areas of conduct for CRAs: 

1) The information to be provided by a CRA in its application for registration and certification, and for the assessment of the systemic importance to the financial stability or integrity of financial markets (ESMA/2011/302); 

2) The presentation of the information, including structure, format, method and period of reporting that a CRA must disclose (ESMA/2011/304); 

3) The assessment of compliance of CRAs with the requirements set out in Article 8(3) on the credit rating methodologies (ESMA/2011/303); and 

4) The content and format of ratings data to be requested from CRAs as part of their periodic report-ing for the purpose of the on-going supervision by ESMA (ESMA/2011/305). 

These consultations papers are accompanied by a press release.