Liability of Rating Agencies Under German and European Law

After the 2008 financial crisis, rating agencies were identified as one of the main actors that contributed to the crisis. In various proceedings—some of which are still pending until today—the question of their liability vis-à-vis investors was raised. Investors who have suffered losses in the crisis claim that they had relied on false ratings that were produced by the rating agencies on request of the issuing institutions. This chapter analyses such claims with regard to jurisdiction and applicable law, and discusses substantive German law on this question. In addition, the recent European legislation on rating agencies’ liability and its relation to member states’ private law is covered.