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Domenici Expects September Vote on Credit-Rating Rules

The European Parliament may next take up proposals to regulate credit-rating companies in September, said Leonardo Domenici, the lawmaker leading work on the rules.

The parliament’s economic and monetary affairs committee yesterday approved legislation that scales back measures proposed by the European Commission. Lawmakers on the panel voted to scrap most of a proposed requirement for businesses to rotate the companies they hire to assess their debt, while backing tighter restrictions on sovereign-debt ratings.

The parliament and national governments must now begin discussions on a final compromise bill before the legislation can become law. The issue may come up at a plenary vote in September, Domenici told journalists today in Brussels. Work on the plans will probably slow down as the EU’s six-month rotating presidency moves from Denmark to Cyprus, he said.

In addition to the compromise on rotation requirements, which would be limited to structured-finance products, the committee’s version of the rules also would regulate the timetable for sovereign-ratings releases and highlight the ratings companies’ role in providing information to markets.

“These evaluations from credit-rating agencies shouldn’t be any kind of political opinion,” Domenici said.

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