Legal Entity Identifier

A Legal Entity Identifier (or LEI) is an international identifier made up of a 20-character identifier that identifies distinct legal entities that engage in financial transactions. It is defined by ISO 17442.[1] Natural persons are not required to have an LEI; they’re eligible to have one issued, however, but only if they act in an independent business capacity.[2] The LEI is a global standard, designed to be non-proprietary data that is freely accessible to all.[3] As of December 2018, over 1,300,000 legal entities from more than 200 countries have now been issued with LEIs.

History

At the time of the 2008 financial crisis, a single identification code unique to each financial institution was unavailable worldwide. It means that each country had different code systems to recognize the counterpart corporation of financial transactions. Accordingly, it was impossible to identify the transaction details of individual corporations, identify the counterpart of financial transactions, and calculate the total risk amount. This resulted in difficulties in estimating individual corporations's amount of the risk exposure, analyzing risks across the market, and resolving the failing financial institutions. This is one of the factors that made it difficult for the early evolution of the financial crisis. The LEI system was developed by the 2011 G20,[4] in response to these inability of financial institutions to identify organisations uniquely, so that their financial transactions in different national jurisdictions can be fully tracked.[5] Currently, the ROC (Regulatory Oversight Committee), a coalition of financial regulators and central banks across the country, is encouraging the expansion of the LEI. Currently, the U.S. and European countries require corporations to use the legal entity identifier when reporting the details of transactions with over-the-counter derivatives to financial authorities. The first LEIs were issued in December 2012.[6]

Code structure

Structure of LEI codes
1 2 3 4 5 6 7 8 9 ... 18 19 20
LOU-
Code
Res-
erved
Entity-
Identification
Check-
sum
G.E. Financing GmbH
5493 00 84UKLVMY22DS 16
Jaguar Land Rover Ltd
2138 00 WSGIIZCXF1P5 72
British Broadcasting Corporation
5493 00 0IBP32UQZ0KL 24

The technical specification for LEI is ISO 17442.[5] An LEI consists of a 20-character alphanumeric string, with the first 4 characters identifying the Local Operating Unit (LOU) that issued the LEI. Characters 5-18 are the unique alphanumeric string assigned to the organisation by the LOU. The final 2 characters are checksum digits.[7]

Global Operating System[8]

G-20
FSB(Financial Stability Board)
LEI ROC
GLEIF

- Board of Directions

LOU 1, LOU 2, LOU 3 ...
  • G-20 : An international organization consisting of representing 20 major countries(90 percent of the world's GDP) like seven developed countries(G7), the chair countries of the European Union, and twelve rising nations.
  • FSB(Financial Stability Board) : An organization founded to enhance the stability of the global financial system and to oversee international finance.
  • LEI ROC(Regulatory Oversight Committee) : The best decision making organization for LEI Systems under FSB. The 40 countries ' financial authorities, the central bank, and IMF are represented as members by international organizations.
  • GLEIF(Global LEI Foundation) : It is responsible for controlling the LOUs in each region as a practical operating organization within the LEI system.
  • LOU(Local Operating Unit) : As the operating organization for issuing and maintaining the LEI code in each region, 31 LOU are currently active worldwide.

Need of LEI[9]

  • Who should have LEI?

Both corporations and funds involved in financial transactions need the LEI. LEI is an identification code designed to recognize all of the entities and funds involved in financial transactions worldwide.Therefore, all corporations and funds that participate in financial transactions should be issued LEI.

  • When does it need?

In the United States and Europe, the parties to the transactions must use the LEI to report to the supervisory authorities any out-of-books derivatives transactions. Recently, it has expanded their coverage such as alternative investments, fund investments, insurance, spot markets, pensions, logistics and bids.

Obtaining a Legal Entity Identifier (LEI)

The Global Legal Entity Identifier Foundation (GLEIF) is not directly issuing Legal Entity Identifiers, but instead it delegates this responsibility to Local Operating Units (LOUs). These LEI issuers supply different services. Local Operating Units can have different prices for the registration services they offer. GLEIF is responsible for monitoring LEI data quality.[10]

Advantages of LEI

  • In financial transactions, you can reduce the risk associated with the counterpart. You can measure the total risk of the other party. You can also determine the risk of a particular trading partner's concentration.
  • You can reduce the cost of reporting tasks. Financial transactions reduce the costs of information gathering and administrative costs to the other party. You can also reduce the cost of various reporting tasks, such as reporting the details of out-of-court derivatives transactions and reporting of the regeneration and cleanup plans.
  • You can enhance market transparency. As LEI is a code of international currency, it is easy to detect market manipulation, financial fraud and other disruption acts through the sharing of international financial transaction information.

See also

References

  1. ^ "The Legal Entity Identifier Regulatory Oversight Committee". LEI ROC. Retrieved 26 May 2016.
  2. ^ "Statement on INDIVIDUALS ACTING IN A BUSINESS CAPACITY" (PDF). LEI ROC. Retrieved 15 December 2017.
  3. ^ "What is an LEI?". GLEIF. Retrieved 26 May 2016.
  4. ^ "What is the LEI system?". Open LEIs. Retrieved 26 May 2016.
  5. ^ a b "The Legal Entity Identifier (LEI) Is Good News for Financial Technology Developers". Data.gov. Retrieved 26 May 2016.
  6. ^ "Legal Entity Identifier Resource Center". Sifma. Retrieved 26 May 2016.
  7. ^ "The Structure of the LEI Code". GLEIF. Retrieved 26 May 2016.
  8. ^ "Korean Securities Depository=http://www.ksd.or.kr/static/KB0117010000.home?menuNo=1099". Missing or empty |url= (help)
  9. ^ "Characteristics of LEI=http://www.ksd.or.kr/static/KB0117020000.home?menuNo=1100". Missing or empty |url= (help)
  10. ^ GLEIF. "How to Get an LEI: Find LEI Issuing Organizations – About LEI – GLEIF". www.gleif.org. Retrieved 2017-10-18.

External links

Euronext Dublin

Euronext Dublin (formerly The Irish Stock Exchange, ISE; Irish: Stocmhalartán na hÉireann) is Ireland's main stock exchange, and has been in existence since 1793.

The Euronext Dublin lists debt and fund securities and is used as a European gateway exchange for companies seeking to access investors in Europe and beyond. With over 35,000 securities listed on its markets, the exchange is used by over 4,000 issuers from more than 85 countries to raise funds and access international investors.A study by Indecon (international economic consultants) published in 2014 on the Irish Stock Exchange found that having a local stock market and securities industry directly supports 2,100 jobs in Ireland and is worth €207 million each year to the Irish economy. It also found that having a domestic securities industry centered on the Irish Stock Exchange generates €207m in estimated direct economic impact (measured in Gross Value Added or GDP) and €230m in direct tax for the Irish exchequer (including stamp duty on trading in Irish shares).The exchange is regulated by the Central Bank of Ireland under the Markets in Financial Instruments Regulations (MiFID) and is a member of the World Federation of Exchanges and the Federation of European Stock Exchanges.

Financial Secrecy Index

The Financial Secrecy Index (FSI) is a qualitative scoring of financial secrecy indicators, weighted by the economic flows of each country. While related to tax havens, the FSI is not a list of tax havens, and it does not estimate actual taxes avoided or profits shifted, unlike the techniques used in tax haven lists. The FSI is more correctly a list of financial secrecy jurisdictions. While having many similarities, the FSI produces some results that are different from tax haven lists.The FSI showed jurisdictions like the U.S. and Germany, despite high tax rates, are large contributors to global financial secrecy, however, this is often misinterpreted as implying that the US and Germany are "tax havens"; for example, foreign corporates do not move to the U.S. or Germany to avoid tax. The FSI does not capture modern corporate tax havens, such as Ireland, the Netherlands and the United Kingdom, who maintain high levels of OECD–compliance and transparency, but are responsible for the global largest base erosion and profit shifting (BEPS) tax avoidance activity. For example, Apple's Irish "leprechaun economics" tax restructure in Q1 2015, the largest BEPS transaction in history, remained unknown for years due to Irish data-protection laws. The issue is the scoring by the FSI for some of the most favoured secrecy tools of modern tax havens (or Conduit OFCs): the unlimited liability company ("ULC"), trusts, and certain SPV structures (e.g. Irish QIAIFs), none of which file public accounts in havens like Ireland and the United Kingdom. The FSI focuses on ownership of these tools (e.g. is the owner of a ULC recorded), versus visibility into the tools (e.g. is the ULC paying tax). An example of this disconnect, was the EU's €13 billion tax fine on Apple's two Irish ULCs in 2016, who while known, were found by the EU to be avoiding large amounts of Irish tax during the 2004–2014 period.

The Financial Secrecy Index started with 60 jurisdictions in 2009, but the latest 2018 FSI now extends to 112 jurisdictions. As well as a ranking table outlining Secrecy Indicators, Global Scale Weights, and FSI Values, the TJN also produces a separate secrecy report on each individual jurisdiction, providing further comment and analysis. The biennial FSI releases are widely reported in the general and financial media, and FSI scores now are seen in EU reports. The 2018 FSI results were released on the Financial Secrecy Index portal, and they update the 2015 FSI results.

ISO 7064

ISO 7064 defines algorithms for calculating check digit characters.

ISO 8000

ISO 8000 is the global standard for Data Quality and Enterprise Master Data. It describes the features and defines the requirements for standard exchange of Master Data among business partners. It establishes the concept of Portability as a requirement for Enterprise Master Data, and the concept that true Enterprise Master Data is unique to each organization.

Master Data is commonly used to manage critical business information about products, services and materials, constituents, clients and counterparties, and for certain immutable transactional and operational records. Application of this standard has already proven it can significantly reduce procurement costs, promote inventory rationalization, and deliver greater efficiency and cost savings in supply chain management.

The ISO 8000 standard was first proposed in 2002, and the first components were approved in 2009. Part 115, which describes "Quality Identifier Prefixes" for "Quality Identifiers," was approved in 2017. Several important enhancements are currently under development, including Part 116 (see the Key Concepts, below). Many successful organizations have already adopted Master Data, and its precursor, Reference Data, and the core elements of the maturing standard are quickly being adopted by many Fortune 500 corporations. Around the world, Government agencies in major economies involved in the supervision and regulation of financial and commodities markets, telecommunications, media, high technology and military have adopted a wide range of ISO 8000 Master Data strategies, and several are establishing audits and controls based upon ISO 8000.

ISO 8000 is one of the emerging technology standards that large and complex organizations are turning to in order to improve business processes and control operational costs. The standard is in the process of being published as a number of separate documents, which ISO calls "parts".

ISO 8000 is being developed by ISO technical committee TC 184, Automation systems and integration, sub-committee SC 4, Industrial data. Like other ISO and IEC standards, ISO 8000 is copyrighted and is not freely available.

ISO 9362

ISO 9362 defines a standard format of Business Identifier Codes (also known as SWIFT-BIC, BIC, SWIFT ID or SWIFT code) approved by the International Organization for Standardization (ISO). It is a unique identification code for both financial and non-financial institutions. The acronym SWIFT stands for the Society for Worldwide Interbank Financial Telecommunication. The ISO has designated SWIFT as the BIC registration authority. When assigned to a non-financial institution, the code may also be known as a Business Entity Identifier or BEI. These codes are used when transferring money between banks, particularly for international wire transfers, and also for the exchange of other messages between banks. The codes can sometimes be found on account statements.

The overlapping issue between ISO 9362 and ISO 13616 is discussed in the article International Bank Account Number (also called IBAN). The SWIFT network does not require a specific format for the transaction so the identification of accounts and transaction types is left to agreements of the transaction partners. In the process of the Single Euro Payments Area the European central banks have agreed on a common format based on IBAN and BIC including an XML-based transmission format for standardized transactions; the TARGET2 is a joint gross clearing system in the European Union that does not require the SWIFT network for transmission (see EBICS). The TARGET-directory lists all the BICs of the banks that are attached to the TARGET2-network being a subset of the SWIFT-directory of BICs.

International Securities Identification Number

An International Securities Identification Number (ISIN) uniquely identifies a security. Its structure is defined in ISO 6166. The ISIN code is a 12-character alphanumeric code that serves for uniform identification of a security through normalization of the assigned National Number, where one exists, at trading and settlement.

International Standard Audiovisual Number

International Standard Audiovisual Number (ISAN) is a unique identifier for audiovisual works and related versions, similar to ISBN for books. It was developed within an ISO (International Organisation for Standardisation) TC46/SC9 working group. ISAN is managed and run by ISAN-IA.

International Standard Link Identifier

The International Standard Link Identifier (ISLI), is an identifier standard. ISLI is a universal identifier for links between entities in the field of information and documentation. It was developed by the International Organization for Standardization (ISO) and published on May 15, 2015. ISO/TC 46/SC 9 is responsible for the development of the ISLI standard.ISLI is used for identifying links between entities in the field of information and documentation. A linked entity can be physical, e.g. a print book or an electronic resource (text, audio, and video); or something abstract, e.g. a physical position within a frame of reference or the time of day.

In the context of modern information technology, the application of resources in the field of information and documentation is increasingly getting diversified. Isolated content products can no longer satisfy the ever-increasing user demand.

Using a link identifier to build links between resources in the field of information and documentation provides a basis for a combined application of resources in the field, and supports collaborative creation of content and data interoperability between systems.

The openness of the ISLI system will boost the emergence of new applications in both multimedia and other fields, which increases the value of the linked-resources.

International Standard Music Number

The International Standard Music Number or ISMN (ISO 10957) is a thirteen-character alphanumeric identifier for printed music developed by ISO.

International Standard Musical Work Code

International Standard Musical Work Code (ISWC) is a unique identifier for musical works, similar to ISBN for books. It is adopted as international standard ISO 15707. The ISO subcommittee with responsibility for the standard is TC 46/SC 9.

International Standard Recording Code

The International Standard Recording Code (ISRC) is an international standard code for uniquely identifying sound recordings and music video recordings. The code was developed by the recording industry in conjunction with the ISO technical committee 46, subcommittee 9 (TC 46/SC 9), which codified the standard as ISO 3901 in 1986, and updated it in 2001.

An ISRC identifies a particular recording, not the work (composition and lyrical content) itself. Therefore, different recordings, edits, and remixes of the same work should each have their own ISRC. Works are identified by ISWC. Recordings remastered without significant audio-quality changes should retain their existing ISRC, but the threshold is left to the discretion of the record company.

International Standard Serial Number

An International Standard Serial Number (ISSN) is an eight-digit serial number used to uniquely identify a serial publication, such as a magazine. The ISSN is especially helpful in distinguishing between serials with the same title. ISSN are used in ordering, cataloging, interlibrary loans, and other practices in connection with serial literature.The ISSN system was first drafted as an International Organization for Standardization (ISO) international standard in 1971 and published as ISO 3297 in 1975. ISO subcommittee TC 46/SC 9 is responsible for maintaining the standard.

When a serial with the same content is published in more than one media type, a different ISSN is assigned to each media type. For example, many serials are published both in print and electronic media. The ISSN system refers to these types as print ISSN (p-ISSN) and electronic ISSN (e-ISSN), respectively. Conversely, as defined in ISO 3297:2007, every serial in the ISSN system is also assigned a linking ISSN (ISSN-L), typically the same as the ISSN assigned to the serial in its first published medium, which links together all ISSNs assigned to the serial in every medium.

International Standard Text Code

The International Standard Text Code (ISTC) is a unique identifier for text-based works. The ISO standard was developed by TC 46/SC 9 and published in March 2009 as ISO 21047:2009. The authority responsible for implementing the standard is The International ISTC Agency.

International identifier

An international identifier is a number of different size which comes above or beside the national identification number and helps to identify a company over several countries in the world.

Lei

Lei or Leis may refer to:

Lei, the plural form of Leu, the name of two currencies. See Romanian leu and Moldovan leu

Lei (garland), a Hawaiian flower necklace

Lei (surname), a Chinese name

Lei Wulong, a fictional character from the Tekken franchise

Lei, Italy, a town in Sardinia

l.e.i. (clothing company), a clothing company targeted at teenage girls

Lago di Lei, an artificial lake on the Swiss/Italian borderLEI may refer to:

Legal Entity Identifier, an identification system to track all parties involved in a financial security transaction, e.g. buyer, seller and issuing (or underlying) companies

LEI, the IATA Airport Code for Almería International Airport

Leicestershire, county in central England

Leicester railway station, England; National Rail station code LEI

Index of Leading Economic Indicators

LEI Wageningen UR a Dutch research institute

Lessico etimologico italiano, an etymological dictionary of the Italian language

Lotus Enterprise Integrator, a Lotus Domino software applicationLEIS may refer to:

Low-energy ion scattering, a technique used to characterize the chemical and structural makeup of materials

OpenCorporates

OpenCorporates is a website which shares data on corporate entities as open data under the share-alike attribution Open Database License. It was created by Chris Taggart and Rob McKinnon, under the auspices of their company, Chrinon Ltd, and launched on 20 December 2010. It has the aims of creating a URL with such data for every corporate entity in the world, importing government data relating to companies and matching it to specific companies.The site also shows groups of companies which are legally part of the same conglomerate. Basic company information is available as open data in XML or JSON format.The OpenCorporates Advisory Board exists to advise OpenCorporates on policy, practice and principles, and to ensure that OpenCorporates remains true to its central mission of the opening of company data for the public good. It was formed by three members: David Eaves, Kaitlin Lee and Andrew Stott.The same team also operate OpenCharities, compiling data on registered charities.

Reference data (financial markets)

Reference data is a catch all term used in the finance industry to describe counterparty and security identifiers used when making a trade. As opposed to market data the reference data is used to complete financial transactions and settle those transactions. The financial service industry and regulatory agencies have pursued a policy of standardizing the reference data that define and describe such transactions.At its most basic level, reference data for a simple sale of a stock in exchange for cash on a highly liquid stock exchange that involves a standard label for the underlying security (e.g., its ISIN), the identity of the seller, the buyer, the broker-dealer(s), the price, etc. At its most complex, reference data covers all relevant particulars for highly complex transactions with multiple dependencies, entities, and contingencies.

Unique Transaction Identifier

A Unique Transaction Identifier (Acronym: UTI), alternatively called Unique Swap Identifier (Acronym: USI) is a globally unique identifier for individual transactions in financial markets. USIs were introduced in late 2012 in the U.S. in the context of Dodd-Frank regulation, where reporting of transactions to Trade Repositories first became mandatory. European financial market regulations followed suit, with reporting to Trade Repositories under EMIR requiring UTIs from February 2014 on. The use of the UTI is also mandatory for regulatory reporting under REMIT. Strictly speaking, the term USI is specific to the U.S. regulation, while UTI is specific to EU regulations. In practice, both terms are used interchangeable, in particular within large trading firms reporting under both regimes.

ISO standards by standard number
1–9999
10000–19999
20000+
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