HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN"L 274/32
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 the United States of America 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)
(2012/628/EU)
THE EUROPEAN COMMISSION,
conditions needs to be assessed in order to consider a
third country legal and supervisory framework equivalent
to Regulation (EC) No 1060/2009.
Having regard to the Treaty on the Functioning of the European
Union,
(4) According
to
the
first
condition,
credit
rating
agencies
in
the third country must be subject to authorisation or
Having regard to Regulation (EC) No 1060/2009 of the
registration and subject to effective supervision and
European Parliament and of the Council of 16 September
enforcement on an ongoing basis. The US legal and
2009 on credit rating agencies (
supervisory framework for credit rating agencies

1 ), and in particular Article 5(6)
thereof,
consists of the Credit Rating Agency Reform Act of
2006 (‘Rating Agency Act’) which seeks to improve the
quality of ratings in order to protect investors and in the
public interest, by fostering accountability, transparency,
Whereas:
and competition in the credit rating industry and Section
15E ( 3 ), Section 17 ( 4 ) and Section 21B(a) ( 5 ) of the
Securities Exchange Act (‘Exchange Act’). The operative
provisions of the Rating Agency Act became applicable
upon the SEC’s adoption in June 2007 of a series of rules
(1) On
12
June
2009
the
Commission
granted
a
mandate
to
the Committee of European Securities Regulators (CESR),
implementing a registration and oversight programme
whose tasks have been assumed by the European
for credit rating agencies that register as Nationally
Securities and Markets Authority established on
Recognized Statistical Ratings Organizations (NRSRO).
1 January 2011 pursuant to Regulation (EU) No
In order to allow the use of their ratings for regulatory
1095/2010 of the European Parliament and of the
purposes credit rating agencies have to register with the
Council of 24 November 2010 establishing a European
SEC and are subsequently supervised by the SEC on an
Supervisory Authority (European Securities and Markets
ongoing basis. The SEC is endowed with a compre
Authority) (
hensive range of supervisory powers allowing it to inves

2 ) (ESMA), requesting their technical advice
with regard to the technical assessment of the legal and
tigate whether credit rating agencies comply with their
supervisory framework of the USA in respect of credit
legal obligations. Those powers include the power to
rating agencies.
access documents, to conduct investigations and to

carry out on-site inspections, as well as the power to
require access to records of telephone recordings and
electronic communication. The SEC can exercise these
powers not only in respect of credit rating agencies,
(2)
In its first advice, delivered on 21 May 2010, the CESR
highlighted two areas (regarding the quality of method
but also in respect of other persons involved in credit
ologies and ratings, and with respect to the disclosure of
rating activities. Section 15E(p)(3)(A) of the Exchange Act
ratings) where significant differences between the United
requires the SEC to conduct an examination of each
States (US) and the Union frameworks persisted.
NRSRO at least annually and to report on the findings
Subsequently, following the entry into force of the
of these examinations ( 6 ). Where the SEC has established
Dodd-Frank Wall Street Reform and Consumer
that an NRSRO is in breach of any obligation arising
Protection Act on 21 July 2010, ESMA has updated its
from the relevant regulatory framework, it may adopt a
technical advice to the Commission indicating that the
wide range of supervisory measures in order to stop the
US legal and supervisory framework in respect of credit
infringement. Those measures include the power to
rating agencies could now be considered equivalent to
withdraw the registration, to suspend the use of ratings
Regulation (EC) No 1060/2009.
for regulatory purposes and to order the credit rating

agencies to stop the infringement. The SEC can also
impose severe penalties on credit rating agencies for
breaches of the relevant requirements. Therefore,
(3) Pursuant
to
the
second
subparagraph
of
Article
5(6)
of
Regulation (EC) No 1060/2009, the fulfilment of three
( 3 ) 15 U.S.C.78o-7.
( 4 ) 15 U.S.C.78q.
( 5 ) 15 U.S.C.78u-2.
( 1 ) OJ L 302, 17.11.2009, p. 1.
( 6 ) See summary report of the SEC Staff’s Examinations of each NRSRO
( 2 ) OJ L 331, 15.12.2010, p. 84.
of September 2011.

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EN
9.10.2012 Official
Journal
of
the
European
Union L
274/33
NRSROs are subject to effective supervision and
credit rating agencies. Therefore, the US legal and super
enforcement on an ongoing basis. The cooperation
visory framework for credit rating agencies should be
agreement concluded between ESMA and the SEC
considered equivalent to the legal and supervisory
provides for information exchange with regard to
framework established by Regulation (EC) No
enforcement and supervisory measures taken against
1060/2009. The Commission, in cooperation with
cross border CRAs.
ESMA, will continue monitoring the evolution of the
US legal and supervisory framework for credit rating
agencies and the fulfilment of the conditions on the
(5) According
to
the
second
condition,
credit
rating
agencies
basis of which this decision has been taken.
in the third country must be subject to legally binding
rules which are equivalent to those set out in Articles 6
to 12 and Annex I to Regulation (EC) No 1060/2009.
(8) The
measures
provided
for
in
this
Decision
are
in
The US legal and supervisory framework meets the
accordance with the opinion of the European Securities
objectives of Regulation (EC) No 1060/2009 in respect
Committee,
of the management of conflicts of interest, the organisa
tional processes and procedures that a credit rating
HAS ADOPTED THIS DECISION:
agency needs to have in place, the quality of ratings
and of rating methodologies, the disclosure of credit
ratings and the general and periodic disclosure of credit
Article 1
rating activities. Therefore, the US framework provides
for equivalent protection in terms of integrity, trans
For the purposes of Article 5 of Regulation (EC) No
parency, good governance of credit rating agencies and
1060/2009, the US legal and supervisory framework for
reliability of the credit rating activities.
credit rating agencies shall be considered as equivalent to the
requirements of Regulation (EC) No 1060/2009.
(6) According
to
the
third
condition,
the
regulatory
regime
Article 2
in the third country must prevent interference by the
supervisory authorities and other public authorities of
This Decision shall enter into force on the twentieth day
that third country with the content of credit ratings
following that of its publication in the Official Journal of the
and methodologies. In this respect, the SEC and any
European Union.
other public authority in the USA are prohibited by
law from interfering with the substance of credit
ratings and credit rating methodologies.
Done at Brussels, 5 October 2012.
(7)
In view of the factors examined, the conditions laid
For the Commission
down in the second subparagraph of Article 5(6) of
Regulation (EC) No 1060/2009 can be considered to
The President
be met by the US legal and supervisory framework for
José Manuel BARROSO

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