Wednesday, June 2, 2010

CESR advises on US/EU CRA regimes

Original posted on Lexology:

CESR has advised the Commission on equivalence between the US and EU legal and supervisory frameworks for CRAs. It found the frameworks are broadly equivalent but there are some differences. (Download the document here: )

It highlights the differences in credit rating disclosure, and quality of credit ratings and credit rating methodology. CESR thinks more convergence on these issues would be good. CESR considered the two regimes in terms of:

  • scope of framework;
  • corporate governance;
  • conflicts management;
  • organisational requirements;
  • quality of methodologies and ratings;
  • disclosure; and
  • effective supervision and enforcement.

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