On 26 May 2021, the European Securities and Markets Authority (ESMA) issued a consultation paper on disclosure requirements for initial reviews and preliminary ratings. The purpose of the consultation paper is to propose guidance that will address existing inconsistencies and reduce the risks that are posed by rating shopping to the extent it is possible under the existing provisions of the CRA Regulation.

The proposed guidance is structured according to three main parts that establish:

  • ESMA’s views on how the term “initial review and preliminary rating” should be understood for the purposes of the CRA Regulation’s public disclosure requirements.
  • ESMA’s view on the content and timing of CRAs public disclosures for interactions that meet the standard of “initial review and preliminary rating”.
  • ESMA’s views on the steps to ensure these public disclosures are more accessible for investors and the market.

The deadline for comments on the consultation paper is 4 August 2021.