Written question asked by James Clappison (Conservative) on Wednesday, 21 July 2010, in the House of Commons. It was due for an answer on Monday, 26 July 2010. It was answered by Mark Hoban (Conservative) on Tuesday, 21 December 2010 on behalf of the Treasury.

Credit Rating Agencies: EU Action

Question: To ask the Chancellor of the Exchequer what assessment he has made of the likely effect of implementation of the European Commission's proposal to amend the EU Regulation on Credit Rating Agencies on UK national competence on this matter; and if he will make a statement.

Answer: The proposed regulation implements the June 2009 European Council decision to move supervision of credit ratings agencies (CRA) from national authorities to the EU level.The regulation is directly applicable to UK law, although some minor implementation is required of member states. The regulation:"introduces a harmonised approach to the regulation of credit rating activities in the European Union;""creates a registration system for CRAs established in the EU, and a certification system for agencies established outside the EU;""requires registered agencies to comply with various provisions relating to independence, conflicts of interest, employees and analysts, methodologies and models, outsourcing, and disclosure and presentation of information; and""requires specified financial institutions to use credit ratings for regulatory purposes only if they have been issued or endorsed by a registered CRA, or issued by an overseas agency that has been certified in accordance with the regulation."

Secondary information