In the aftermath of the Lehmann crisis, Regulation (EC) No 1060/2009 on credit rating agencies (CRA I) was the first to be adopted. This Regulation was amended by Regulation (EU) No 513/2011 (CRA II), which established the sole competence of the European Securities and Markets Authority (ESMA) for registering and ensuring the ongoing supervision of credit rating agencies in the European Union. Regulation (EU) No 462/2013 (CRA III) further amended Regulation (EC) No 1060/2009. Rules were included to prevent exclusive or automatic recourse to ratings by credit rating agencies for supervisory purposes. Essentially, CRA III also includes rules on taking account of conflicts of interest in connection with investments in credit rating agencies, the maximum duration of contractual relations with a rating agency, publication of country ratings, taking account of information on structured finance instruments, and the liability of credit rating agencies under civil law. As ratings are a fixed component of the securities market, CRA III makes deep incursions into this market.
Another consequence of the Lehmann crisis is EMIR (European Market Infrastructure Regulation), which is intended to curb systemic risks in the European derivatives market. The EU Regulation contains requirements that apply to the parties involved in derivatives transactions. Specific requirements apply regardless of whether the enterprise concerned provides financial services or not. This means that all real economy enterprises using derivatives for hedging purposes derivatives are affected.
Likewise in the wake of the financial crisis, the European Markets in Financial Instruments Directive (MiFID) has been newly drafted as MiFID II. The EU member states have to implement the Directive until 3 July 2016; from the beginning of 2017, market players must abide by the new rules. MiFID II is supplemented by the Markets in Financial Instruments Regulation (MiFIR), which applies directly in the member states. Compliance with this Regulation begins on 3 January 2017. The main substantive amendments introduced by MiFID II and MiFIR concern investor protection and market topics.
CRA III, EMIR, MiFiD, MiFIR are supplemented and given practical application by the European Securities and Markets Authority (ESMA) by means of technical standards, guidelines, Q&As, etc.
Other regulations that are important for the securities market are the Securities Trading Act (WpHG) for Germany and the European Prospectus Regulation. Both contain requirements relating to the contents of the prospectus. The WpHG gives priority to stipulations regarding the obligation is to issue a prospectus and the procedure for preparing and approving the prospectus. In the EU there are plans for a stronger alignment of prospectus law and supervision. Q&As on this matter are currently only available at EBA level.