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ISCOVER
Staff Reporter
The European Securities and Markets Authority (ESMA) has officially endorsed Australia’s regulatory regime on credit rating agencies.
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The endorsement follows a careful assessment of Australia’s regulatory framework for CRAs and the agreement of a Memorandum of Understanding with ASIC on cooperation for the supervision of CRAs, after which the ESMA concluded that Australia’s CRA regulation is ‘as stringent’ as the regulation in the European Union.
“Since 1 January 2010, ASIC’s implementation of strengthened credit rating agency regulation has aligned Australia’s regulation with the International Organization of Securities Commissions (IOSCO) principles and with regulation in major markets such as the United States, Europe and Japan,” ASIC chairman Greg Medcraft said.
“ESMA’s endorsement of Australia’s CRA regulation will facilitate Australian debt issuers’ use of their Australian-issued credit ratings in the European Union.”
ESMA’s endorsement decision comes ahead of EU restrictions on use of third country credit ratings set to take effect from 1 May 2012.
