ISLAMABAD, March 6, 2025: The Appellate Bench of the Securities and Exchange Commission of Pakistan (SECP) has dismissed the appeal filed by VIS Credit Rating Company Limited (formerly JCR-VIS Rating Company Limited) against the penalty imposed for multiple regulatory violations of Credit Rating Companies Regulations, 2016.
The appeal challenged the SECP’s order dated October 16, 2019 passed by Commissioner, SMD under Section 159 of the Securities Act, 2015, which determined the company’s non-compliance with several provisions of the said Regulations. These violations included issues related to conflict of interest in rating assignments, failure to conduct internal audit review, inadequate risk management policies and framework, absence of indicative rating, and lapses in maintaining regulatory documentation.
After reviewing the arguments of both the parties, the Appellate Bench upheld the SECP’s decision, reaffirming the penalty of PKR 800,000/- on VIS Credit Rating Company. The Appellate Bench emphasized the importance of strict adherence to regulatory framework to maintain transparency and integrity in the credit rating industry. The Appellate Bench reiterated that a credit rating agency must uphold the highest standards of fairness, efficiency, transparency, and ethics in their operations.
The SECP remains committed to enforcing compliance with applicable laws to ensure a fair and efficient financial market. Since credit rating agencies contribute to market transparency, investor confidence, and financial stability, therefore they are considered as a key component of the financial ecosystem and have strict obligation to exercise due diligence in complying with regulatory requirements.
