Civil Liability of Credit Rating Agencies after CRA 3 - Regulatory All-or-Nothing Approaches between Immunity and Over-Deterrence

Civil liability of rating agencies has to strike a balance between over-deterrence and overly lax behavior control. The resulting problems of a capital market freeze and difficulties of proof, as they become apparent in most legal systems and the European Commission’s Draft Proposal to amend the EU-Rating Regulation, could possibly be eliminated by procedural presumptions or liability caps. The paper was prepared for the Seminar on the regulation of Credit Rating Agencies in Oslo 10 December 2012, organized by The International Financial Market Regulation, Institutions and Efficiency Projects at the Department of Private Law and supported by the Finance Market Fund. The paper is accepted for publication in European Business Law Review, and will be published in a special issue edited by Mads Andenas and Gudula Deipenbrock