European Union: Legal Entity Identifier (LEI) - Solving The Mystery Of The New Regime

Last Updated: 7 February 2018
Article by Erika Vella

After the last financial crisis and, in particular, the collapse of Lehman Brothers in 2008, financial regulators and private sector managers found it difficult to uncover the network of participants connected. Consequently, this financial crisis revealed the need to identify financial connections and link data globally so as to make it easier for financial regulators and firms to understand and monitor the true nature of risk exposures. A better financial infrastructure was needed so as to bring about a unified and transparent global identification system for legal entities across markets and jurisdictions and increase the resilience of the financial market.

For this reason the G20 established the Financial Stability Board (FSB), a supra- national regulatory co-ordination body, whose job was to prepare recommendations for LEI governance and the implementation framework. The FSB defined a three-tier structure, consisting of a Regulatory Oversight Committee (ROC), a Central Operating Unit (COU) operated by the Global Legal Entity Foundation (GLEIF, and Local Operating Units (LOU).

The Financial Stability Board (FSB), with a secretariat in Basel, Switzerland, was set up to co-ordinate, at the international level, the work of national financial authorities and international standard-setting bodies in order to develop the implementation of effective regulatory, supervisory and other financial sector policies.

The Global LEI Foundation, overseen by the ROC, is the operational arm of the global system. The ROC is a group of 71 public authorities and observers from more than 50 countries and is the governing body which is responsible for the co-ordination of the world-wide framework of the LEI.

The Local Operating Units (LOUs) are the primary interfaces for anybody interested in registering for a LEI. LOUs manage registration, validation and implementation of LEI records. LOUs may have a variety of statuses and may be an entity conducting other activities such as a stock exchange or custodians. A list of LEI issuing organisations/LOUs may be found on: get-an-lei-find-lei-issuing-organizations.


The use of LEI numbers is already required under a number of European regulations such as:

  • The European Markets Infrastructure Regulation (EMIR) as from 1 November 2017 (the EU trade repositories are mandated to reject trade reports that do not contain an LEI irrespective of whether they pertain to the EU or non-EU
  • market participants);
  • The EU Regulation and Directive on Markets in Financial Instruments, commonly referred to as MiFIR and MiFID II;
  • The EU Market Abuse Regulation (MAR);
  • The EU Capital Requirements Regulation (CRR);
  • The EU Central Securities Depositories Regulation (CSDR);
  • The EU Transparency Directive;
  • The EU Alternative Investment Fund Managers Directive
  • The Swiss Financial Markets Infrastructure Act (FMIA);
  • The Swiss Financial Market Infrastructure Ordinance (FMIO).

The first LEI numbers were issued in 2012 and by mid-2017 the LEI's coverage amounted to over 500,000 entities from 200 different countries.

What is the LEI, who needs it and what are its effects?

A LEI is a 20-character, alpha-numeric code to uniquely identify legally distinct entities that engage in financial transactions. The LEI number is associated with reference data for each entity. It is not solely limited to the European Union and Switzerland, but is a global initiative. One may apply for a LEI code through any of the LOUs endorsed by the ROC in any country. A legal entity is therefore not limited to using a LOU in its own country and can choose to use the registration services of any LOU accredited and qualified to grant LEI registration. Registration for LEI number must be renewed annually.

The LEI number and data associated with it will be available free of charge to regulators and the public. The LEI number will allow financial supervisors to track global transactions and take action where necessary. An entity may transfer the maintenance of its LEI number from one LOU to another. To do so, the entity must contact the new LOU stating its already existing LEI number and providing any further documentation the new LOU may require. The new LOU will contact the retiring LOU. The LEI number will not be changed with this process. No fee should be charged by the retiring LOU for this transfer. The code never changes even if there is a change in the structure of the entity and an entity will have only one code which will be used everywhere in the world. Therefore data about an entity recorded in one dataset at one point in time will be the same data shown in another place at a different time. The LEI number has also become part of the Know Your Customer (KYC) and on-boarding process of financial institutions.

Failure to obtain a LEI number will result in non-compliance with regulatory requirements and prevent the entity from trading in securities. Essentially, every legal entity that is a party to a financial transaction and/or trades in derivatives must be registered for a LEI number.

November 2017

To view the full article, please click here

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions