What is an LEI?
A Legal Entity Identifier, LEI for short, is a unique 20-character, alphanumeric code used to report financial transactions on the global financial market. It serves as your company's digital footprint and makes it possible for financial authorities, in the UK and worldwide, to trace any transactions you've been involved in. Any company or organization wishing to make financial trades needs an LEI, since they are required in the reports given by your bank to the FCA.
The history behind Legal Entity Identifiers
The financial market prior to the 2008-2009 crisis suffered from a lack of transparency. As each country had their own system for recognizing the participants in financial transactions, it was hard for a company or an organization to obtain the details of their business counterparts, which led to unwanted risk exposure and uncertainty in the financial market.
After the crisis, regulators realised the need for an open, global database of legal entities active on the international financial market, and at the 2011 G20 meeting representants from the participating countries formulated the initiative. The LEI system was designed and the first LEIs were issued in late 2012. In 2014, the Financial Stability Board established the Global Legal Entity Identifier Foundation (GLEIF), representing public authorities form around the world. GLEIF now provides the Global LEI index, that contains all historical and current LEI records, making it easy to identify and examine the counterparts in financial transactions. The LEI system has been a huge step towards better transparency on the financial market.
Who needs an LEI?
Any legal entity that wishes to participate in financial transactions requires an LEI. Banks around the world are currently urging their corporate customers to obtain their own LEI, since they are required to include it in their trnasaction reports to the regulatory authorities. This requirement is stated in the two financial EU regulations EMIR and MiFID II.
If your company or organization wishes to make financial trades, you will almost certainly need an LEI. If you are unsure, don't hesitate to contact us and we will help you. You can also contact your bank.
How do I buy and register an LEI number?
It is easy to buy an LEI from UKLEI. As an Official Registration Agent for one of the world's largest issuers of LEIs, the GMEI Utility, we offer you safe and swift registration and payment through our web portal. After you've applied, we take care of the communication with the issuer, and in most cases you have your issued and registered LEI number in your inbox after 2-3 business days.
If you wish to obtain multiple LEIs for different companies, we also offer bulk registration, where you can apply for a large number of LEIs instead of registering them one at a time. For example, this can be convenient for a parent company applying for LEIs on behalf of its subsidiaries, or an accountancy firm applying on behalf of several clients at once.
We offer personal, knowledgeable and experienced support for UK companies and organizations, and we are always available if you have any questions.