On the 11th February, the European Securities and Markets Authority (ESMA) published a consultation paper setting out the draft Regulatory Technical Standards (RTS) required for the implementation of the CRA3 Regulation (Regulation). The draft RTS, which complements the existing regulatory framework for Credit Rating Agencies (CRAs), cover:
- disclosure requirement on Structured Finance Instruments (SFIs);
- the European Rating Platform (ERP); and
- the periodic reporting on fees charged by CRAs.
They aim to facilitate the provision of adequate information on SFIs, and their underlying assets, to investors, in order to improve their ability to make informed assessments on the creditworthiness of SFIs, reduce reliance on external ratings, promote competition between CRAs and facilitate the assignment of unsolicited credit ratings.
