CHAPTER 2

REGISTRATION
SECTION 5

Staffing and compensation

Staffing policies and procedures
Article 14
1
A credit rating agency shall provide ESMA with information regarding the following policies and procedures:
a
reporting to the compliance officer of any situations where one of the persons referred to in point 1 of Section C of Annex I to Regulation (EC) No 1060/2009 considers that any other such person has engaged in conduct that he or she considers illegal, pursuant to the provisions of point 5 of Section C of Annex I to Regulation (EC) No 1060/2009;
b
the rotation of lead rating analysts, rating analysts and persons approving credit rating;
c
the compensation and performance evaluation practices for rating analysts, persons approving credit ratings, senior management and the compliance officer;
d
the training and development relevant to the rating process, including any examination or other type of formal assessment required for the conduct of rating activities.
2
A credit rating agency shall also provide ESMA with:
a
a description of the measures in place to mitigate the risk of over-reliance on individual employees;
b
for each class of credit ratings, information on the size and experience of the quantitative teams responsible for developing and reviewing methodologies and models;
c
the name and function of any employee of the credit rating agency who has obligations, either individually or on behalf of the credit rating agency, to any other entity within the group of credit rating agencies;
d
the average annual fixed and variable remuneration of the rating analysts, lead analysts and the compliance officer for each of the preceding three financial years.
3
A credit rating agency shall describe the arrangements in place to ensure that it is informed when a rating analyst terminates his or her employment and joins a rated entity as set out in point 6 of Section C of Annex I to Regulation (EC) No 1060/2009. A credit rating agency shall describe the arrangements in place to ensure that the persons referred in point 1 of Section C of Annex I to Regulation (EC) No 1060/2009 are aware of the prohibition established as set out in point 7 of Section C of Annex I to Regulation (EC) No 1060/2009.

Fitness and appropriateness
Article 15
1
A credit rating agency shall provide ESMA with the curriculum vitae, including employment history with relevant dates, identification of positions held and a description of the functions occupied, for each of the following:
a
members of senior management;
b
persons appointed to direct the business of the branches;
c
officers responsible for internal audit, internal control, compliance function, risk assessment and review function.
2
A credit rating agency shall provide ESMA with the following information in respect of each member of its senior management:
a
a recent criminal-record file from the country of origin of the relevant person, unless the relevant national authorities do not issue such a file;
b
a self-declaration of their good repute including at least the statements set out in Annex VI and signed by the individual.