Extraterritorial Exemption

SEC Extends NRSRO Extraterritorial Exemption from Rule 17g-5

On November 16, the SEC extended the temporary conditional exemption for NRSROs from complying with Rule 17g-5(a)(3) for rating covered transactions until December 2, 2012. Rule 17g-5(a)(3) requires that an NRSRO must maintain a password-protected website containing the information provided to it by the arranger for each structured finance product for which it is in the process of determining a credit rating. Under the exemption, an NRSRO is not required to comply with Rule 17g-5(a)(3) where: (i) the issuer is a non-U.S. person and (ii) the NRSRO reasonably believes that the structured finance products will be sold only outside of the U.S. SEC Release.