“We enable smarter, less costly and more reliable decisions about who to do business with“GLEIF – Global Legal Entity Identifier Foundation.
The Legal Entity Identifier (LEI)
is a 20-character, alpha-numeric code based on the ISO 17442 standard developed by the International Organization for Standardization (ISO). It connects to key reference information that enables clear and unique identification of legal entities participating in financial transactions. Each LEI contains information about an entity’s ownership structure and thus answers the questions of ‘who is who’ and ‘who owns whom’. Simply put, the publicly available LEI data pool can be regarded as a global directory, which greatly enhances transparency in the global marketplace.
The European Union (EU) revised Markets in Financial Instruments Directive (MiFID II) and Regulation (MiFIR), covering trading venues, investment firms and intermediaries, took effect on 3 January 2018. The MiFID II/MiFIR implementing legislative acts require a significant number of actors to obtain a Legal Entity Identifier (LEI) that are under no such obligation to date. With regard to transaction reporting under MiFIR, the European Securities and Markets Authority (ESMA) has clarified that investment firms should obtain LEIs from their clients before providing services which would trigger reporting obligations in respect of transactions carried out on behalf of those clients. The Global Legal Entity Identifier Foundation (GLEIF) calls on market participants that have to comply with MiFID II/MiFIR to obtain an LEI as soon as possible. Firms should also proactively contact their impacted client base and encourage registration for and renewal of an LEI. Additionally, firms may consider deepening the use of the LEI within their client onboarding infrastructures so as to benefit from the EU-wide use of this common identifier.
The Financial Stability Board (FSB) has reiterated that global LEI adoption underpins “multiple financial stability objectives” such as improved risk management in firms as well as better assessment of micro and macro-prudential risks. As a result, it promotes market integrity while containing market abuse and financial fraud. Last but not least, LEI rollout “supports higher quality and accuracy of financial data overall”.
The publicly available LEI data pool is a unique key to standardized information on legal entities globally. The data is registered and regularly verified according to protocols and procedures established by the LEI Regulatory Oversight Committee.
In cooperation with its partners in the Global LEI System, the Global Legal Entity Identifier Foundation (GLEIF) continues to focus on further optimizing the quality, reliability and usability of LEI data, empowering market participants to benefit from the wealth of information available with the LEI population.
The drivers of the LEI initiative, i.e. the Group of 20, the FSB and many regulators around the world, have emphasized the need to make the LEI a broad public good. The Global LEI Index, made available by GLEIF, greatly contributes to meeting this objective. It puts the complete LEI data at the disposal of any interested party, conveniently and free of charge.
The benefits for the wider business community to be generated with the Global LEI Index grow in line with the rate of LEI adoption. To maximize the benefits of entity identification across financial markets and beyond, firms are therefore encouraged to engage in the process and get their own LEI. Obtaining an LEI is easy. Registrants simply contact their preferred business partner from the list of LEI issuing organizations available on the GLEIF website.
Who needs a Legal Entity Identifier (LEI) number at this point?
As of January 3rd, 2018 all legal entities which wish to transact in European financial markets involving any kind of securities or derivates (for example Stocks, Bonds, ETFs, FX Forwards, Swaps, Interest rate Swaps, etc.) need to register for an LEI number.
At present most of the LEI requirements are derived from the Markets in Financial Instruments Directive (MiFID II) and European Market Infrastructure Regulation (EMIR). The main purpose of these acts is to ensure a higher transparency and stability of the global financial market.
Application for a Legal Entity Identifier (LEI) number
The registration for an LEI number or code is a simple three-step process:
1. Fill in all the blanks in the LEI application form above.
2. Submit your application and pay with a credit card, PayPal or bank link.
3. Your data will be processed and the LEI code sent to you by e-mail.
Your application will be sent for data validation as soon as you have submitted the payment. In 90% of the cases you will receive your LEI within 3-4 hours during weekdays.