Moody's appeals HK ruling

Added 28th April 2016

The ratings agency has appealed the decision to fine and reprimand it for a critical analysis of Chinese companies.

Moody's appeals HK ruling

The firm has served a notice of appeal with respect to the Securities and Futures Appeals Tribunal's decision on March 31, Donough Foley, senior vice president for government and public affairs at Moody’s Asia Pacific, confirmed in an e-mailed statement on Thursday.

Moody's has been fined HK$11m ($1.4m) "for various failures relating to its preparation and publication of the special report entitled ‘Red Flags for Emerging-Market Companies: A Focus on China’ published on 11 July 2011", according to the tribunal’s ruling.

It followed the Securities and Futures Commission’s HK$23m fine in November 2014. It was also the SFC’s first action against a credit rating firm since it started regulating credit rating activities in June 2011.

Activist David Webb believes that the SFC and SFAT's general approach is "deeply disturbing" because it will have a chilling effect on further critical research.

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