HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN"L 274/30
EN
Official Journal of the European Union
9.10.2012
COMMISSION IMPLEMENTING DECISION
of 5 October 2012
on the recognition of the legal and supervisory framework of Australia as equivalent to the
requirements of Regulation (EC) No 1060/2009 of the European Parliament and of the Council
on credit rating agencies
(Text with EEA relevance)
(2012/627/EU)
THE EUROPEAN COMMISSION,
the Australian Securities and Investments Commission
(ASIC) Act (2001), have entered into force. According
to this regulatory framework, credit rating agencies
Having regard to the Treaty on the Functioning of the European
have to be registered and are supervised on an ongoing
Union,
basis by the Australian Securities and Investments
Commission (ASIC). The Australian legal and supervisory
framework endows ASIC with sufficient powers to enable
effective supervision and enforcement of credit rating
Having regard to Regulation (EC) No 1060/2009 of the
agencies, including the power to sanction CRAs in
European Parliament and of the Council of 16 September
breach of the applicable rules: ASIC can be warranted
2009 on credit rating agencies ( 1 ), and in particular Article 5(6)
to seize books not produced by CRAs. On the basis of
thereof,
a search warrant granted by the competent judicial auth
ority, ASIC has the power to search the premises of
CRAs. In addition, ASIC is empowered by the Corpor
Whereas:
ations Act to apply to a federal court for orders to cancel
the licence of a credit rating agency. Following such
cancellation of a licence, ASIC can apply to a court for
(1) On
17
November
2009
the
Commission
granted
a
orders to permanently prohibit the CRA from issuing
mandate to the Committee of European Securities Regu
credit ratings in Australia. Under the Corporations Act,
lators (CESR), whose tasks have been assumed by the
ASIC may also apply for orders to stop unlawful
European Securities and Markets Authority established
behaviour by a CRA or impose fines where it has
on 1 January 2011 pursuant to Regulation (EU) No
contravened any of its obligations under the relevant
1095/2010 of the European Parliament and of the
financial services legislation. The cooperation agreement
Council of 24 November 2010 establishing a European
concluded between ESMA and ASIC provides for
Supervisory Authority (European Securities and Markets
information exchange with regard to enforcement and
Authority) (
supervisory measures taken against cross border CRAs.

2 ) (ESMA), requesting their advice with regard
to the technical assessment of the legal and supervisory
framework of Australia in respect of credit rating
agencies.
(5) According
to
the
second
condition,
credit
rating
agencies
in the third country must be subject to legally binding
(2) In
its
advice
delivered
on
18
April
2012,
ESMA
rules which are equivalent to those set out in Articles 6
suggested that the Australian legal and supervisory
to 12 and Annex I to Regulation (EC) No 1060/2009.
framework in respect of credit rating agencies be
The Australian legal and supervisory framework meets
considered equivalent to Regulation (EC) No 1060/2009.
the objectives of the EU regulatory framework for
credit rating agencies in relation to conflicts-of-interest
management. Conflicts-of-interest management is
required by the Australian legislation (ASIC Act)
(3) Pursuant
to
the
second
subparagraph
of
Article
5(6)
of
including the obligation to manage conflicts of interest
Regulation (EC) No 1060/2009, the fulfilment of three
and organisational requirements, notably with regard to
conditions needs to be assessed in order to consider a
outsourcing, record keeping and confidentiality. With
third country legal and supervisory framework equivalent
regard to corporate governance, the ASIC’s licence
to Regulation (EC) No 1060/2009.
conditions require a CRA to be organised in a manner
that ensures its business interest does not impair the
independence and accuracy of its credit rating activities.
(4) According
to
the
first
condition,
credit
rating
agencies
in
The Australian framework also requires CRAs to establish
the third country must be subject to authorisation or
a rigorous review function for rating methodologies and
registration and subject to effective supervision and
contains a wide range of disclosure requirements with
enforcement on an ongoing basis. The Australian legal
regard to credit ratings and rating activities. Therefore,
and regulatory framework for credit rating agencies was
the Australian legal and supervisory framework meets the
introduced on 1 January 2010. All relevant laws and
objectives of Regulation (EC) No 1060/2009 in respect
regulations, namely the Corporations Act (2001) and
of the management of conflicts of interest, the organisa
tional processes and procedures that a credit rating
( 1 ) OJ L 302, 17.11.2009, p. 1.
agency needs to have in place, the quality of ratings
( 2 ) OJ L 331, 15.12.2010, p. 84.
and of rating methodologies, the disclosure of credit

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EN
9.10.2012 Official
Journal
of
the
European
Union L
274/31
ratings and the general and periodic disclosure of credit
framework for credit rating agencies and the fulfilment of
rating activities. It thus provides for equivalent protection
the conditions on the basis of which this decision has
in terms of integrity, transparency, good governance of
been taken.
credit rating agencies and reliability of the credit rating
activities.
(8) The
measures
provided
for
in
this
Decision
are
in
accordance with the opinion of the European Securities
Committee,
(6) According
to
the
third
condition,
the
regulatory
regime
in the third country must prevent interference by the
supervisory authorities and other public authorities of
HAS ADOPTED THIS DECISION:
that third country with the content of credit ratings
and methodologies. Any such interference with credit
ratings and rating methodologies would be contrary to
Article 1
the objectives of Chapter 7 of the Australian Corpor
For the purposes of Article 5 of Regulation (EC) No
ations Act of 2001 and ASIC’s objectives. Neither ASIC
1060/2009, the Australian legal and supervisory framework
nor any other public authority is empowered to interfere
for credit rating agencies shall be considered as equivalent to
with the content of credit ratings or credit rating
the requirements of Regulation (EC) No 1060/2009.
methodologies.
Article 2
(7)
In view of the factors examined, the conditions laid
This Decision shall enter into force on the day following that of
down in the second subparagraph of Article 5(6) of
its publication in the Official Journal of the European Union.
Regulation (EC) No 1060/2009 can be considered to
be met by the Australian legal and supervisory
framework for credit rating agencies. Therefore, the
Australian legal and supervisory framework for credit
Done at Brussels, 5 October 2012.
rating agencies should be considered equivalent to the
legal and supervisory framework established by Regu
For the Commission
lation (EC) No 1060/2009. The Commission, in
cooperation with ESMA, will continue monitoring the
The President
evolution of the Australian legal and supervisory
José Manuel BARROSO

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Document Outline

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