On August 27, 2014, the US Securities and Exchange Commission (“SEC”) adopted new requirements for credit rating agencies to enhance governance, protect against conflicts of interest, and increase transparency to enhance the quality of credit ratings and increase credit rating agency accountability. The new rules and amendments adopted by the SEC implement certain rulemaking requirements under the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank Act”) with respect to nationally recognized statistical rating organizations (“NRSROs”). The new requirements provide for an annual certification by CEOs as to the effectiveness of internal controls and other certifications accompanying credit ratings to attest that the rating was not influenced by other business activities.

While certain amendments will become effective 60 days after publication in the Federal Register, the amendments with respect to the annual report on internal controls and the production and disclosure of performance statistics will be effective on January 1, 2015. Certain other provisions are effective nine months after publication in the Federal Register, including: prohibiting the sales and marketing conflict; addressing look-back reviews to determine whether the credit analyst’s prospects of future employment influenced a credit rating; specifying the disclosure of rating histories; addressing rating methodologies; requiring the form and certification to accompany credit ratings; addressing issuer and underwriter disclosure of third-party due diligence findings; addressing the certification of a third-party due diligence provider; addressing NRSRO standards of training, experience, and competence; and addressing universal rating symbols.

The final SEC rule is available at: http://www.sec.gov/rules/final/2014/34-72936.pdf.