Credit Rating Agencies

The Joint Board of Appeal (BoA) of the European Supervisory Authorities (ESAs – ESMA, EIOPA and EBA) issued decisions regarding four appeals it received by Svenska Handelsbanken AB, Skandinaviska Enskilda Banken (SEB) AB, Swedbank AB, and Nordea Bank Abp against decisions by the European Securities and Markets Authority (ESMA) regarding infringements of the Credit Rating Agencies Regulation (CRAR).

On 11 July 2018, ESMA decided to fine the five banks for negligently infringing the CRAR by issuing credit ratings without being registered. While the BoA confirmed the infringements found by ESMA, it accepted the appellants’ claims of having acted non-negligently and remitted the case to ESMA’s Board of Supervisors to adopt amended decisions based on the BoA findings. In the context of the proceedings, the BoA also dismissed an application by one appellant to suspend ESMA’s decision addressed to it.


ESMA is currently studying the BoA’s decisions, before deciding on the next steps. According to the ESMA Regulation, appeals against decisions of the BoA can be brought before the Court of Justice of the European Union.


The European Securities and Markets Authority (ESMA) has published today its 2019 Supervision Work Programme, which details the main areas of focus for the upcoming year for ESMA’s supervision of Trade Repositories (TRs), Credit Rating Agencies (CRAs), and the monitoring of third-country market infrastructures such as third-country central clearing counterparties (TC-CCPs) and third-country Central Securities Depositories (TC-CSDs).

ESMA currently directly supervises eight TRs and 27 CRAs. It also carries responsibility for four certified CRAs and 32 TC-CCPs.

Main priorities for 2019

For CRAs and TRs in the EU, ESMA uses a risk-based approach to establish its annual Supervision Work Programme, considering the main developments per industry and per registered entity.  For 2019, the supervisory priorities will include:

  • TR data quality and access by public authorities;
  • TR business continuity planning, IT process and system reliability, and information security function;
  • CRA portfolio risk and quality of the rating process;
  • CRA Cybersecurity;
  • Recognition of UK CCPs in a no-deal Brexit scenario; and
  • Assessing the pending applications for recognition as TC-CCPs (19) and TC-CSDs, including risk monitoring.

In addition, there are areas where common issues exist across TRs and CRAs on which ESMA will perform further work including Brexit, fees charged by CRAs and TRs, the effectiveness of internal control systems, and the use of new technologies.

The European Securities and Markets Authority (ESMA) has today published its revised Guidelines on the information which credit rating agencies (CRAs) need to report to ESMA for supervisory purposes. 

These Guidelines amend some sections of ESMA’s 2015 Guidelines on the reporting of periodic information to ensure they continue to support ESMA’s supervisory processes in an efficient and effective manner.

The main goal of the Guidelines is to streamline the information that is reported on a periodic basis by CRAs to ESMA, ensuring that the information is fully aligned with ESMA’s supervisory processes. However, a secondary goal of the Guidelines is to increase the predictability of ESMA’s supervisory interactions with CRAs, with respect to the requests for information that ESMA submits to CRAs.

The main features of the revised Guidelines are the following:

  • Differentiated reporting calendars for entities depending on required level of supervisory engagement;
  • Individual reporting instructions for each reporting item which have been elaborated and expanded in areas where ESMA has identified a supervisory need; and
  • Standardising reporting templates for specific reporting items.

The publication of these Guidelines follows a public consultation in July 2018 following which a number of refinements have been introduced in areas such as cost and revenue reporting, “as soon as” notifications and reporting calendars.  

Next steps

ESMA will make all relevant templates available on ESMA’s website. This will be done sufficiently in advance of the implementation date to allow for a period of testing between ESMA and CRAs.

The European Securities and Markets Authority (ESMA) and European securities regulators have agreed Memoranda of Understanding (MoUs) with the Financial Conduct Authority (FCA) of the United Kingdom (UK).

The MoUs form part of authorities’ preparations should the UK leave the EU without a withdrawal agreement, the no-deal Brexit scenario. The MoUs will therefore only take effect in the event of a no-deal Brexit scenario. The MoUs are similar to those already concluded on the exchange of information with many third country supervisory authorities.

The MoUs are:

1.    an MoU between ESMA and the FCA concerning the exchange of information in relation to the supervision of credit rating agencies (CRAs) and trade repositories (TRs). The MoU will allow ESMA to continue to discharge its mission and meet its mandate regarding investor protection, orderly markets and financial stability in the EU; and

2.    a multilateral MoU (MMoU) between EU/EEA securities regulators and the FCA covering supervisory cooperation, enforcement and information exchange between individual regulators and the FCA, and will allow them to share information relating to, amongst others, market surveillance, investment services and asset management activities. This, in turn, will allow certain activities, such as fund manager outsourcing and delegation, to continue to be carried out by UK based entities on behalf of counterparties based in the EEA.

The European Securities and Markets Authority (ESMA) has today withdrawn the credit rating agency (CRA) registrations of S&P Global Ratings France and S&P Global Ratings Italy following the merger with S&P Global Ratings Europe, based in Ireland.

The withdrawal decisions follow the official notification to ESMA by S&P on 21 November 2018 of its intention to renounce the two registrations under the conditions set out in Article 20(1)(a) of the CRA Regulation (CRAR). S&P Global Ratings Europe will continue to be registered with ESMA, as it also merged with Standard and Poor's Credit Market Services Europe Limited (based in the United Kingdom) on 30 June 2018. The latter is the remaining registration.

Point (a) of Article 20(1) of the CRAR provides that without prejudice to Article 24, ESMA shall withdraw the registration of a credit rating agency where the credit rating agency expressly renounces the registration or has provided no credit ratings for the preceding six months.