Brussels on Monday urged a clampdown on the world's ratings agencies, including a ban on ratings for countries covered by international rescue packages, and possible legal action.
Internal Markets Commissioner Michel Barnier said in a speech delivered in Paris but released in Brussels that he would ask Poland, which currently holds the rotating European Union presidency, to put action on ratings agencies to ministers soon.
"We must first and foremost be more demanding on ratings of sovereign debts," he said. "We see ecah day the effects on the countries concerned: a hike in the cost of credit, weakened states, possible contagion to other economies."
Arriving in Brussels for eurozone talks, German Finance Minister Wolfgang Schauble said that verification was needed "to check if there is abusive behaviour" by the agencies.
"We need to examine the possibilities of smashing the rating agency oligopoly," he added.
Moody's came under heavy EU fire last week after downgrading Portugal's rating to "junk" status, casting new doubts on markets over EU efforts to manage the eurozone debt crisis.
Some leading European Union personalities were particularly upset over the timing of the ratings cut.
The downgrade was made just as Portugal begins to implement austerity measures in return for a 78-billion-euro ($110-billion) EU-IMF bailout agreed in April, and as the eurozone struggles to craft a new rescue package for Greece.
"The idea isn't to break the thermometre when faced by the very real difficulties of certain states," Barnier said.
"But when a country belongs to the European Union and benefits from the solidarity of its members, when it follows a programme of international aid, one cannot refuse to take this into account."
"In these conditions one must also ask," he said "whether sovereign ratings can be allowed when a country is under an international programme".
The commissioner said ratings agencies should be forced to notify governments before a downgrade to enable the data to be checked.
He also suggested that new EU regulations enable legal action against ratnigs agencies in the case of negligence or violation of the rules.
Standard & Poor's, Moody's and Fitch have been criticised as playing a role in the global financial crisis for issuing high ratings for some of the complex financial instruments blamed for the downswing.
European Commission president Jose Manuel Barroso said last week that there was a growing consensus in the 27-nation bloc for the need to apply a regulatory framework to ratings agencies.
He also suggested it was time for a European ratings agency to emerge as a counterweight to the US-dominated groups.
"We know that when there are oligopolies there are sometimes attempts to abuse the dominant position or market manipulation, so the more competition the better -- this is our credo."
The OECD too has joined the criticism, with its chief economist Pier Carlo Padoan telling Italy's Stampa newspaperthat "lately, rating agencies have proved that they are strongly 'pro-cyclical' and produce self-realising prophesies"
Padoan said the agencies did not merely pass on information but "express judgements, speeding up trends already at work."
He said: "It's like pushing someone who is on the edge of a cliff. It aggravates the crisis."