The Securities and Exchange Commission of Pakistan (SECP) has directed the companies to seek the No-Objection Certificate (NOC) from the existing credit rating company before hiring a new credit rating agency.
The SECP has amended the Credit Rating Companies Regulation, 2016 through a notification issued on Saturday. Any company cannot change its credit rating agency without clearance from the existing credit rating company as per new regulations.
Where a company intends to terminate the rating contract/agreement with an existing credit rating company and engage another credit rating company, it shall obtain an NOC from existing credit rating companies or continue the rating contract/agreement with the existing credit rating company for a period of one year.
Both the credit rating companies (existing and newly engaged) shall provide credit ratings simultaneously for a period of six months falling within the period of one year. After the expiry of one year, the agreement with the existing credit rating company shall stand terminated, and SECP revised regulations added.
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