Regulation of the European Parliament and of the Council (amending Regulation (EC) No 1060/2009 on credit rating agencies)
March 22, 2011
The European Parliament have published an amending regulation on credit rating agencies. This regulation was born out of the fact that the Commission previously concluded that the supervisory framework of the financial sector within the European Union needed to be strengthened to reduce the risk and severity of future financial crises.
The Regulation discusses the role of the European Securities and Markets Authority (ESMA), so that financial market participants can identify the competent authority in the credit rating agencies field. ESMA is to be exclusively responsible for the registration and supervision of credit rating agencies in the EU.
However, ESMA will not be responsible for oversight of the users of credit ratings. Competent authorities designated under relevant sectoral legislation for the supervision of credit institutions, investment firms, insurance undertakings, assurance undertakings, reinsurance undertakings, undertakings for collective investment in transferable securities (UCITS) etc should remain responsible for the supervision of the use of credit ratings by those financial institutions.