APPLICATION OF UNION LEGISLATION

Law 15/2011 of 16 June 2011 (BOE of 17 June 2011) amending certain financial legislation
applies to the Spanish legal system Regulation 1060/2009 of the European Parliament
and of the Council of 16 September 2009 on credit rating agencies.
The main purpose of the Law is to establish the obligation for certain financial institutions29
to use the ratings issued by credit rating agencies. Also, the legislation on credit rating
agencies is adjusted as necessary for the respective national supervisors to cooperate
with the ESMA.
The main amendments made by the Law are as follows:
From the standpoint of solvency, the use by credit institutions or investment firms of
external credit ratings shall require that these have been issued or endorsed by an
ESMA established in the European Union and registered according to Regulation
1060/2009. Ratings of institutions established or financial instruments issued outside
the European Union must have been issued by a credit rating entity established in a
non-Member State that has received an equivalent certification in accordance with
Regulation 1060/2009.
The credit rating agency must have been recognised by the Banco de España or, where
applicable, by the CNMV, in accordance with the criteria established for this purpose and,
in turn, considering the objectivity, independence, transparency and ongoing review of the
methodology applied, as well as the market credibility and acceptance of the credit ratings
issued by that credit rating agency.
The CNMV supervision, inspection and sanctioning regime established in Securities Market
Law 24/1988 of 28 July 1988 shall apply to: 1) the credit rating agencies established in
Spain and registered in accordance with Regulation 1060/2009, persons involved in credit
rating activities, rated entities and related third parties, third parties to whom the credit
rating agencies have outsourced certain functions or activities, and other persons otherwise
related or connected to credit rating agencies or credit rating activities, and 2) the
credit rating agencies registered by a competent authority of the European Union, and the
credit rating agencies registered by a competent authority of a third country that have received
certification based on equivalence under said Regulation, and which in both cases
operate in Spain.
The CNMV shall exercise its authority and apply the infringement and sanctioning regime
pursuant to Law 24/1988 in accordance with European Union legislation on credit
rating agencies. It shall have the necessary supervision and inspection powers to
perform the functions assigned by delegation or under cooperation arrangements with
other competent authorities, in accordance with the provisions of Regulation
1060/2009.
The CNMV shall cooperate with and assist other competent authorities of the European
Union to carry out the functions set out in Regulation 1060/2009. In particular it may request
the cooperation of other competent authorities of the European Union in a supervisory
activity, for an on-the-sport verification or an investigation of, inter alia, matters relating
to credit rating agencies.
Lastly, the CNMV shall maintain, in addition to the official registers set out in Law 24/1988,
which shall be freely available to the public, a register of credit rating agencies established
in Spain.
The Law came into force on 18 June 2011.