Standard & Poor's Ratings Services (Canada), a business unit of The McGraw-Hill Companies (Canada) Corporation

Order

Headnote

NP 11-205 Process for Designation of Credit Rating Organizations in Multiple Jurisdictions -- Application to be designated as a designated rating organization for the purposes of Canadian securities laws -- Filer has filed all documentation required under Part 2 of National Instrument 25-101 Designated Rating Organizations -- Filer is in compliance in all material respects with U.S. federal securities law applicable to an NRSRO -- Upon being designated, the Filer will be subject to the requirements set out in the Legislation and the securities legislation in each of the Passport Jurisdictions, except as contemplated by section of the Decision -- Designation granted subject to conditions -- The designation order provides a six month transition for the Filer to be fully compliant with NI 25-101.

Applicable Legislative Provisions

Securities Act (Ontario), R.S.O. 1990, c. S.5. as am., s. 22.

National Instrument 25-101 Designated Rating Organizations, ss. 6, 15.

April 30, 2012

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ONTARIO

(the Jurisdiction)

AND

IN THE MATTER OF

THE PROCESS FOR DESIGNATION OF

CREDIT RATING ORGANIZATIONS IN

MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

STANDARD & POOR'S RATINGS SERVICES

(CANADA), A BUSINESS UNIT OF THE

MCGRAW-HILL COMPANIES (CANADA)

CORPORATION

(the Filer)

DESIGNATION ORDER

Background

The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) that the Filer be designated as a Designated Rating Organization (the Designation Order), as contemplated by National Instrument 25-101Designated Rating Organizations (NI 25-101).

Under the Process for Designation of Credit Rating Organizations in Multiple Jurisdictions (for a passport application):

(a) the Ontario Securities Commission (the Commission) is the principal regulator for this application; and

(b) the Filer has provided notice that Section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Manitoba, Québec, Nova Scotia, New Brunswick, Prince Edward Island, Newfoundland and Labrador, the Northwest Territories, Yukon and Nunavut (the Passport Jurisdictions).

Interpretation

Terms defined in National Instrument 14-101 Definitions, MI 11-102 or NI 25-101 have the same meanings in this decision, unless otherwise defined herein.

Representations

This decision is based on the following facts represented by the Filer:

1. The Filer is a separately identifiable business unit of a corporation governed by the laws of Nova Scotia with its registered and principal offices located in Toronto, Ontario, which corporation is an indirect wholly-owned subsidiary of The McGraw-Hill Companies, Inc. (McGraw-Hill), a corporation organized under the laws of New York.

2. The Filer, together with the other components of S&P Ratings Services (defined below), provides credit rating opinions, research and risk analysis to a broad range of financial institutions, corporate entities, government bodies and various structured finance product groups in North America, Europe, Africa, Australasia and South America.

3. The Filer is a component of Standard & Poor's Ratings Services (S&P Ratings Services) which is a Nationally Recognized Statistical Rating Organization (NRSRO) regulated by the SEC, and which includes related global offices that issue ratings under the Ratings Services global brand. S&P Ratings Services is comprised of, and conducts its business globally through, wholly-owned direct and indirect subsidiaries or divisions of McGraw-Hill. The credit rating activities of S&P Ratings Services are conducted globally by this business unit in accordance with a code of conduct, policies and guidelines, and criteria that are generally globally applicable. Therefore, for purposes of this Designation Order the ratings of the other components of S&P Ratings Services are deemed to be ratings of the Filer. Currently, the Filer, together with the other components of S&P Ratings Services, has more than one million ratings outstanding covering corporate, government and special purposes issuers and obligors and their commercial paper, term debt and other debt securities and preferred shares in the global capital markets.

4. On April 20, 2012, NI 25-101 came into force in the Jurisdiction and in each Passport Jurisdiction.

5 The Filer is in compliance in all material respects with the securities legislation applicable to credit rating organizations in each jurisdiction in Canada, other than NI 25-101, and in any other jurisdiction in which the Filer operates.

6. The Filer has filed all documentation required under Part 2 of NI 25-101, with the exception of certain materials that are being withheld pending the Commission's determination as to whether they will be accorded confidential treatment.

7. S&P Ratings Services is registered as and is in compliance in all material respects with U.S. federal securities law applicable to, an NRSRO. For further disclosure see S&P Ratings Services' Form NRSRO available on the Standard & Poor's website and the Form 10-K for McGraw-Hill filed with the SEC for the year ended December 31, 2011 available on the McGraw-Hill website and the SEC's EDGAR database.

8. The Filer has considered the implications of NI 25-101 and understands that, subject to further discussion with the Commission's staff, it may need to implement new, or amend its existing, code of conduct, policies, guidelines and practices in order to be fully compliant with NI 25-101. To provide for such discussion and achieve compliance with each of the US, European and Canadian regimes which may apply to ratings issued by the Filer, a transition period is required to allow the Filer to become fully compliant with NI 25-101.

9. Upon being designated as a Designated Rating Organization, the Filer will be subject to the requirements set out in the Legislation and the securities legislation in each of the Passport Jurisdictions, except as contemplated by section 1 of the Decision below.

Decision

The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.

The decision of the principal regulator under the Legislation is that:

1. the Filer is designated as a Designated Rating Organization under the Legislation and is exempt from the application of NI 25-101 for the term of this Designation Order (as determined pursuant to section 2 below), provided that:

(a) the Filer, by virtue of being a component of S&P Ratings Services, is in compliance in all material respects with U.S. federal securities law applicable to an NRSRO as stated in paragraph 7 of the representations to this Designation Order;

(b) the Filer files with the Commission copies of all documents the NRSRO is required to provide under the 1934 Act, at the same time as, or as soon as practicable after, the NRSRO provides those documents to the SEC, subject in all cases to satisfactory resolution, prior to filing of such documents, of any issues regarding confidentiality of materials filed with the SEC on a confidential basis; and

2. for each jurisdiction of Canada, this Designation Order will terminate on the earlier of:

(a) the date of the coming into force of any designation order or ruling under the securities legislation of any jurisdiction of Canada that amends this Designation Order or provides an alternate designation order pursuant to NI 25-101; and

(b) October 31, 2012.

"Howard Wetston"
Chair
Ontario Securities Commission
 
"James Turner"
Vice-Chair
Ontario Securities Commission