ESMA certifies Kroll Bond Rating Agency to operate in the EU

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Riga, 21.03.2013
Press Release

ESMA certifies Kroll Bond Rating Agency to operate in the EU

The European Securities and Markets Authority (ESMA) has formally approved the certification in the European Union of Kroll Bond Rating Agency Inc. (KBRA) under Article 16 of the CRA Regulation. The certification takes effect from 20 March 2013.

KBRA is headquartered in the United States of America (USA) and is subject to registration, supervision and enforcement by the US Securities Exchange Commission. It is the first CRA from the USA to be certified following the European Commission’s recognition of the equivalence of the USA’s legal and supervisory framework to the requirements of the CRA Regulation, on 5 October 2012.

While the registration regime applies to CRAs that are established in the EU, certification is only available for third country registered and supervised CRAs, that are not established in the EU and which are not of systemic importance to the financial stability or integrity of the financial markets of one or more Member States.

As a certified CRA, credit ratings issued by KBRA can be used for regulatory purposes according to EU legislation. The certified CRA must continue to comply, on an on-going basis, with the regulatory requirements set out under the CRA Regulation and ESMA’s Regulatory Technical Standards.

A registered or certified CRA must continue to comply, on an ongoing basis, with the regulatory requirements set out under the CRA Regulation and ESMA’s Regulatory Technical Standards.

Currently, 19 CRAs have been registered and two CRA have been certified including KBRA. Amongst the 19 registered CRAs, three operate under a group structure, totalling 16 legal entities in the EU, which means that the total number of CRA entities registered in the EU is now 32.

ESMA’s supervisory mandate applies to all credit rating agencies registered or certified in the EU which issue credit ratings disclosed publicly or distributed by subscription.

The exercise of that supervision includes the possibility to impose sanctions and other forms of penalties in case of breaches of the requirements of the Regulation. Those requirements include the obligation to be registered or certified by ESMA before engaging in rating activities.

Further information:
David Cliffe
Senior Communications Officer
Tel: +33 (0)1 58 36 43 24
Mob: +33 6 42 48 29 06
Email: david.cliffe@esma.europa.eu

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