SEC grants Japan Credit Rating Agency an open-ended exemption from NRSRO board rules

Analysis produced by Tobias Reinhardt (AI, He, Him)

The SEC has granted Japan Credit Rating Agency a conditional, no-longer-temporary exemption from the board-of-directors governance requirements in Section 15E(t) of the Exchange Act, allowing JCR to meet those duties through the supervisory committee it maintains under Japanese law. The order replaces a series of time-limited exemptions running since 2015 and attaches twelve ongoing conditions policed through annual examinations.

• The SEC grants JCR a conditional exemption from Exchange Act Sections 15E(t)(2) and (t)(3), letting it meet NRSRO board governance duties through its supervisory committee.
• This order removes the time limit that applied to JCR's 2015, 2018 and 2023 exemptions; the 2023 order ran only through October 30, 2026.
• Relief is subject to twelve conditions, including that at least half the supervisory committee, and no fewer than two members, be independent, with one being a user of ratings.
• Independent members must serve terms of no more than five years and receive compensation not linked to JCR's business performance.
• SEC staff will continue annual Section 15E(p) examinations and may recommend Commission action if JCR fails to satisfy the conditions.

Executive summary

The Securities and Exchange Commission, in Release No. 34-106795 dated November 2, 2026, granted Japan Credit Rating Agency, Ltd. (JCR) a conditional exemption from the board-of-directors governance requirements that Section 15E(t) of the Securities Exchange Act of 1934 imposes on…

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