LEI Europa validation tool allows to check if your company already has an LEI number. If no LEI number has been issued, we will refer to authorized LEI Registration Agent in your Member State. You can initiate secure data transfer from LEI Europa database to relevant Registration Agent.
Cross-border identification of legal entities in securities transactions
The use of the legal entity identifier is mandated by the European Commission’s Implementing Regulation (EU) No. 1247/2012 (2), which provides for the use of a unique and more universal code when dealing in OTC derivatives, central counterparties, and trade repositories. The central depositories’ own identifiers should only be used internally. When an entity reports and submits information to competent authorities, a generally accepted standard such as an LEI (equivalent to ISO standard 17442) should be used. This allows parties to securities transactions to be identified based on their LEI code, regardless of their contracting country.
How is an LEI code issued?
Companies called Local Operating Units (or LOUs) are accredited by the Global Legal Entity Identifier Foundation (GLEIF), the umbrella organization of the global LEI system, to issue LEI codes. LOUs work with LEI code registration agents who prepare clients’ LEI registration applications and forward them to LOUs for validation and LEI code issuance. When an LEI code is issued, it is sent out to the email address provided in the application, and the LEI code and relevant entity data are transferred to the international GLEIF database.
How often must an LEI code be updated?
An LEI code is issued for 1 year and must be updated annually. This process is designed to increase the reliability of the data and keep it up-to-date. An LEI code can be renewed up to 60 days before its expiry. To start the renewal process, an entity must submit an online request to an LEI code service provider.
The European Securities Market Supervisory Authority (ESMA) requires market participants to have an active LEI code (status “ISSUED” in the GLEIF database) to comply with the MiFID II / MiFIR regulations. Regulated financial institutions are not permitted to accept transaction orders for securities listed on the stock exchange from clients with an expired LEI code.
Which implementing regulations mandate the use of an LEI code in the European Union?
European Commission Implementing Regulation (EU) No. 1247/2012 (2) provided that since OTC derivative contracts are usually neither uniquely identifiable by existing codes that are widely used in financial markets, such as the International Securities Identification Code (ISIN), nor described by the ISO classification of financial instruments (CFI ) code, a new and commonly used detection method had to be developed. On August 16, 2012, Regulation (EU) No. 648/2012 of the European Parliament and of the Council of July 4, 2012, on over-the-counter derivatives, central counterparties and trade repositories (“EMIR”) entered into force, which contained guidelines for the use of the LEI code to fulfill the EMIR reporting obligation. The greater need for the use of LEI codes arose from the directive 2014/65/EU (MIFID 2), which came into effect on January 3, 2018, and the directly applicable regulation (EU) No. 600/2014 (MIFIR, Article 26), which imposed the obligation of an LEI code on all companies registered in Europe that wanted to buy or sell securities listed on the stock exchange.
LEI code data is stored in a single central register managed by the Global Legal Entity Identifier Foundation, or GLEIF. Only GLEIF-accredited LOUs can submit data to the register. The information stored in the register is public and available to all market participants via the GLEIF website www.gleif.org. Data from the GLEIF database can be retrieved by validation software. The database is updated once a day.
LEI Europa consolidates data from different registers and compares them with the data entered in the GLEIF register.
Since LEI codes follow the principles of free movement of services and goods, entities are not permanently tied to any registrar. This means that, at any time, a company can change its LEI code registrar (LOU) to any other member state or third country registrar accredited to manage LEI codes from the entity’s country of incorporation.
In order to identify companies, it is important that the company’s data is up to date in the GLEIF database. Consequently, entities are required to submit up-to-date data about the entity’s status, contact information and ownership structure to the registrar at least once a year. The date the data was last submitted for an entity can be checked via the GLEIF database or using the LEI Europa validation tool.
Registrars and account managers may request information related to an entity’s LEI code from the GLEIF database via an online query. It is not necessary to submit any paperwork or other documents. It is also not necessary to purchase a certificate or other evidence to use the LEI code, as the GLEIF and LOUs do not sell paid certificates. Instead, account managers or registrars make an electronic request to the GLEIF to verify the data related to an LEI code.
| 8 | 9 | 4 | 5 | 0 | 0 | 2 | 7 | A | K | 4 | L | S | O | G | X | G | Y | 1 | 8 |
| LOU identification code | Unique identifier | Control numbers | |||||||||||||||||
An LEI code is a unique 20-character code made up of letters and numbers that comply with ISO standard 17442. The first four symbols identify the registrar (LOU) that first issued the LEI code. These do not change if an entity later decides to change its registrar. The registrar’s symbols are followed by two zeros, followed by a unique code that identifies an entity in the GLEIF register. The entire code is always submitted to the register (including the LOU identification code, control numbers and company identifier). It is not possible to identify which member state the registrar managing an LEI was operating in at the time of the request. However, this information is publicly available from the GLEIF database or using the LEI Europa validation tool.
The use of the legal entity identifier is mandated by the European Commission’s Implementing Regulation (EU) No. 1247/2012 (2), which provides for the use of a unique and more universal code when dealing in OTC derivatives, central counterparties, and trade repositories. The central depositories’ own identifiers should only be used internally. When an entity reports and submits information to competent authorities, a generally accepted standard such as an LEI (equivalent to ISO standard 17442) should be used. This allows parties to securities transactions to be identified based on their LEI code, regardless of their contracting country.
An LEI code is a unique 20-character code made up of letters and numbers that comply with ISO standard 17442. The first four symbols identify the registrar (LOU) that first issued the LEI code. These do not change if an entity later decides to change its registrar. The registrar’s symbols are followed by two zeros, followed by a unique code that identifies an entity in the GLEIF register. The entire code is always submitted to the register(including the LOU identification code, control numbers and company identifier). It is not possible to identify which member state the registrar managing an LEI code at the time of the request based on the code itself. However, this information is publicly available from the GLEIF database or using the LEI Europa validation tool.