Department of Labor Proposed Amendment to Underwriter Exemption

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On December 28, 2012, the Department of Labor published a proposed amendment to the definition of the term “Rating Agency” under Section III.X of the individual Prohibited Transaction Exemptions (otherwise known as the Underwriter Exemptions). The proposed amendment would eliminate any specific reference to a particular credit rating agency, and substitute a requirement that a credit rating agency: (i) be currently recognized by the SEC as an NRSRO; (ii) have indicated on its most recently filed SEC Form NRSRO that it rates ‘‘issuers of asset-backed securities’’; and (iii) have had at least 3 ‘‘qualified ratings engagements’’ within a period not exceeding 12 months prior to the closing of the current transaction. Comments on the proposed amendment must be submitted by February 11. DOL Notice of Proposed Amendment.

Topics:  DOL, Rating Agencies, SEC, Underwriting

Published In: Administrative Agency Updates, Finance & Banking Updates, Labor & Employment Updates, Securities Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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