Introduction and purpose of legal entity identifier
The Legal Entity
Identifier (LEI) code is conceived as a key measure to improve the quality and
accuracy of financial data systems for better risk management post the Global Financial
Crisis.
The LEI is
designed to enable the identification and linking of parties to financial
transactions to manage counter party risk. Its goal is to help improve the
measuring and monitoring of systemic risk and support more cost-effective compliance
with regulatory reporting requirements.
Regulatory authority of LEI
The Global LEI
System (GLEIS) has been set up by regulatory authorities [including G20 and the
Financial Stability Board (FSB)] to address the global financial crisis. The
online portals of the Financial Stability Board (FSB), Regulatory Oversight
Committee and Global Legal Entity Identifier Foundation provide general
information on the status of the global LEI system.
Why is Legal Entity Identifier
required for organization?
The Legal Entity Identifier (LEI) is a global reference number that uniquely
identifies every legal entity or structure that is party to a financial
transaction, in any jurisdiction.
LEIL will assign LEIs to any legal identity including but not limited to all
intermediary institutions, banks, mutual funds, partnership companies, trusts,
holdings, special purpose vehicles, asset management companies and all other
institutions being parties to financial transactions.
LEI will be assigned on application from the legal entity and after due
validation of data.
Renewal of the LEI Code:
An LEI Code is
generally valid for one year. In order to continue to use the code, it must be
renewed through an application form. This can be found on the same online
portal; the only difference this time around is to select the option “Modify
and Renewal” and not the “Register” option. Again, any changes to this part
will also need the authorised person to do so. In the form, once the LEI Code
is entered in, all the details appear automatically. Any modifications to be
made shall be made. The “LEI Renewal” checkbox has to be checked right and then
the same process of form completion, payment and document submission is
followed. On successful submission of all the above, the LEI Code is renewed,
and the confirmation of the same is received.
The LEI registration form consists of 5 pages in total, including the payment gateway
· Submission
of the documents: The applicant
entity will have to upload all the necessary documents mentioned in the email.
The total size of the uploaded documents should be 40MB. If the upload is
unsuccessful, then the documents may be couriered to the following address:-
· Verification process: Once the documents
are uploaded or sent physically, they will be verified by the LEIL along with
the application form. If necessary, the LEIL may ask for additional documents
as well. The applicant entity may also be directed to make changes in the
application form online by the LEIL.
· Issue
of LEI Code: The LEI code will
be issued on the successful submission and verification of the form and the
related documents. The LEI code will be sent in an email to the entity, and
this code must be provided to the banks
