ESMA issues call for evidence on restricted subscription and private credit ratings

The European Securities and Markets Authority (ESMA) has launched a call for evidence on the purposes, market practices, needs and risks associated with restricted subscription and private credit ratings. In particular, ESMA seeks views on:

• The characteristics and use cases of restricted subscription and private credit ratings, including their benefits compared with publicly disclosed ratings.
• The characteristics of the parties who are contracting for restricted subscription and private credit ratings and those to whom they are disclosed or distributed.
• Evidence on whether, and to what extent, the analytical processes, governance arrangements, and internal controls applied to restricted subscription and private credit ratings are comparable to those applied to public credit ratings.

ESMA requests evidence-based responses, including quantitative information where available, as well as concrete examples drawn from market practice. The deadline for comments is 31 May. Responses will be reviewed in Q2 with a view to assessing whether specific regulatory adjustments or clarifications may be needed to enhance clarity on the application of the Credit Rating Agencies Regulation (EC) No 1060/2009.

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