March 18, 2019

ESMA registered Beyond Ratings SAS as a Credit Rating Agency (CRA) under the CRA Regulation, with effect from March 18, 2019. Beyond Ratings SAS, which is based in Paris, France, intends to issue sovereign and public finance ratings.

The CRA Regulation seeks to ensure that credit ratings issued in the EU meet minimum standards of quality, transparency, and independence by providing that only companies registered by ESMA as CRAs may lawfully issue credit ratings. These credit ratings can be used for regulatory purposes by credit institutions, investment firms, insurance, and reinsurance undertakings, institutions for occupational retirement provision, management companies, investment companies, alternative investment fund managers, and central counterparties. To be registered as a CRA, a company must be able to demonstrate to ESMA that it complies with the requirements of the CRA Regulation, which covers the:

  • Governance of CRAs and the management of conflicts of interest
  • Development and application of methodologies for assessing credit risk
  • Disclosure of information to ESMA and to market participants

Once registered, CRAs are subject to ongoing monitoring and supervision by ESMA to ensure that they continue to meet the conditions for registration. ESMA will impose sanctions and/or penalties where it finds that a CRA has failed to meet its obligations under the CRA Regulation. The total number of CRAs registered in the EU is 28 CRAs. Among the 28 registered CRAs, four operate under a group structure, totaling 19 legal entities in the EU, which means that the total number of CRA entities registered in EU is 43.

 

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Keywords: Europe, EU, France, Banking, Securities, Beyond Ratings SAS, CRA, CRA Regulation, ESMA