Obtaining LEI (Legal Entity Identifier)
Legal Entity Identifier (LEI) – It’s time to obtain one
January 3rd 2018 the Transaction Reporting that investment firms and credit institutions are obligated to perform to competent authorities (regulators) in the EU area was extended. Among other things, identifying legal entities using LEI became mandatory.
A Legal Entity Identifier (LEI) is a 20-digit code that uniquely identifies a legal entity participating in financial market transactions.
As defined in ISO 17442, the standard underlying the Legal Entity Identifier (LEI), the term ‘legal entity’ includes, but is not limited to, unique parties that are legally or financially responsible for the performance of financial transactions or have the legal right in their jurisdiction to enter independently into legal contracts, regardless of whether they are incorporated or constituted in some other way (e.g. trust, partnership, contractual). It excludes natural persons, but includes governmental organizations and supranationals.
European Market Infrastructure Regulation (EMIR)
Entities established in the EU and Norway must comply with the rules and practices of EMIR. All parties to a derivative contract or the party to which it delegates the reporting, shall report to a Trade Repository (TR). LEI will be the unique identifier of the party in a report on a derivative contract.
November 1st 2017, a LEI became compulsory for all legal entities entering into derivative contracts. For more information, please visit: https://www.finanstilsynet.no/tema/emir
Markets in financial Instruments Directive (MiFID II/MiFIR)
With MiFID II/MiFIR pre- and post-transaction reporting has been extended. Using LEI is now mandatory for entities buying or selling a financial instrument to comply with MiFID II/MiFIR in the EU and Norway.
MiFID II/MiFIR was applied January 3rd 2018. For more information, please visit: https://www.finanstilsynet.no/tema/mifid-ii–mifir/
How to obtain an LEI
Obtaining a Legal Entity Identifier (LEI) is easy. Below we have listed a few providers. For more information about LEI, please visit Global Legal Entity Identifier Foundation www.gleif.org/en
The price of an initial LEI registration is around USD 150 and the annual maintenance from year two is around USD 120.