LONDON (Reuters) – The European Union has banned major credit rating agencies from rating Russia and the country’s companies as part of its latest sanctions package, the European Commission said on Tuesday.
“These sanctions https://ec.europa.eu/commission/presscorner/detail/en/IP_22_1761 will further increase economic pressure on the Kremlin and cripple its ability to fund its invasion of Ukraine,” the commission said. in a press release. statement, adding that the package of measures had been “coordinated with international partners, including the United States.”
Neither the US Treasury, the UK Foreign Office, nor the UK’s Financial Conduct Authority, which regulates ratings for Europe’s largest financial centre, responded to requests for comment.
The three main global rating agencies, S&P Global, Moody’s and Fitch, would risk losing their license to operate in the EU if they flout the ban.
All three have already withdrawn or suspended a handful of Russian corporate ratings for companies subject to the toughest US sanctions from OFAC, but Tuesday’s decision would force dozens more.
S&P Global declined to comment on the Commission’s announcement at the request of Reuters. Fitch said it “complies with all regulations applicable to credit rating agencies,” while Moody’s did not respond to emails or calls.
Other measures in the EU package included an import ban on Russian steel products currently subject to EU safeguard measures, which it said would be worth around 3.3 billion euros (330.15 million) of lost export revenue for Russia.
There has also been a ban on the export of luxury goods such as luxury cars and jewelry, and an increase in the number of wealthy people sanctioned with links to Russian President Vladimir Putin.
The measures also come just a day before Russia is due to make its first bond payments in the international market since being covered by Western sanctions.
If payments are not made by the end of the April 15 “grace period”, Russia would be in default on its international debt for the first time since the Bolshevik Revolution more than a century ago.
($1 = 0.9087 euros)
(Additional reporting by Huw Jones in London and Michelle Price in Washington; Editing by Saikat Chatterjee, Mark Potter and Jonathan Oatis)