Credit rating agencies are to face registration obligations in Europe if France has its say when it takes over the leadership of the European Union later this year.

Speaking today at the annual meeting of the International Organization of Securities Commissions in Paris, French economy minister, Christine Lagarde, said that when it takes the helm of the EU on July 1 it will be pushing for rating agency registration in the region. She suggested that the step is necessary to facilitate supervision of the influential organizations in the wake of the credit market disruption, which has revealed weaknesses in the ratings process.

Yesterday, IOSCO published the final report containing amendments to its code of conduct for CRAs that are intended to address issues which have arisen in the market for structured finance products in particular.

“IOSCO’s code of conduct aims to improve investor protection, improve the fairness, efficiency and transparency of securities markets and to reduce systemic risk,” explained Michel Prada, outgoing chairman of IOSCO’s technical committee and chairman of France’s securities regulator. “I believe that these changes to the code of conduct will help to address a number of issues that have arisen as a result of the current credit crisis regarding how the credit ratings for structured finance products are developed by credit ratings agencies and relied upon by issuers and investors.

He added that IOSCO’s members expect credit rating agencies to adopt the code and to demonstrate to regulators and market participants how they have implemented it through their own codes of conduct. It also pledged to monitor the implementation.

“The amended code of conduct will assist CRAs in strengthening their processes and procedures to protect the integrity of the ratings process, ensure that investors and issuers are treated fairly and safeguard confidential material information provided,” he added.

Notwithstanding the pending regulatory changes facing the rating agencies, Lagarde also suggested that the credit crunch may be easing. She noted that there are signs of improvement in both debt and inter-bank markets.