LEI Code FAQ

Q: What is an LEI?

“LEI” is short for the “Legal Entity Identifier.” It’s a 20-digit code consisting of both letters and numbers to comply with ISO 17442 standards. LEIs are assigned to legal entities that engage in financial transactions. Each LEI is unique to that entity, and each entity may only be issued one LEI.

Note that a valid LEI does not constitute permission for an entity to make those transactions. Such permission is usually granted by the licensing commission in the entity’s jurisdiction of formation. The LEI merely identifies the organization. Verification of is right to transact financial business must be obtained from the licensing authority.

Q: Who needs an LEI, and why?

The LEI is used by supervisors and regulators to identify entities who are parties to transactions in global financial markets.

Almost every entity worldwide whose transactions touch nations in the European Union (EU) need an LEI. The EU made LEI disclosure mandatory for derivative transactions with Implementing Regulation No. 2017/105, implemented 1 November 2017. LEIs are also used to identify parties to over-the-counter derivatives trades, per the European Market Infrastructure Regulations (EMIR).

As of 1 January 2017, companies that issue LEIs must have LEIs themselves.

Q: What entities can receive an LEI?

Any entity that is a party to a financial transaction can apply for an LEI. Examples include:

• Registered companies.
• Registered subsidiaries of another company.
• Branch offices.
• Government bureaus.
• Trusts.
• Funds.
• Charities.
• Nonprofits.
• Nongovernmental organizations.
• Registered sole proprietors.

Individuals do not need LEI. Neither do divisions of a larger company; they should use the LEI of the parent company.

Q: How does an LEI relate to a securities or financial instrument transaction?

Regulators and supervisors in various jurisdictions use LEIs to keep track of the identities of parties to financial transactions in global markets. This helps those regulators and supervisors track cases of financial abuse and verify compliance of the parties with laws and regulations that protect investors and consumers.

Q: What information is required to be issued an LEI?

An entity applying for an LEI must supply an authorized LOU with its:

• Legal name.
• Registered address.
• Address of headquarters.
• Registration number and governing authority.
• Entity type.
• Parent company relationship information.

Q: What happens if an LEI is not provided on applicable transaction documents?

If an LEI is required by regulators but not provided by any party to the transaction, any service providers facilitating the transaction will not be able to comply with its reporting obligations. As such, the service provider will most likely decline or refuse to provide those services, and the transaction is unlikely to close.

Q: What does GLEIF stand for, and what is it?

GLEIF stands for “Global Legal Entity Identifier Foundation.” GLEIF is the supervisory body established by the EU Financial Stability Board (FSB) to oversee and ensure the integrity of the LEI system. With headquarters in Basel, Switzerland, GLEIF can be found on the web at www.Gleif.org.

GLEIF is accountable to the LEI Regulatory Oversight Committee (LEI ROC), a body that verifies the quality of the work GLEIF does in maintaining the LEI system.

Q: What does LOU stand for, and what is it?

LOU stands for the “Local Operating Unit.” These entities are authorized to issue LEIs to qualified entities, under the supervision of GLEIF. LOUs keep those registered LEIs on file, making them available free of charge to regulators and the public.

Q: What does an LEI registration agent do?

An LEI registration agent is a company that helps entities apply for an LEI, often acting as a middleman between the applicant entity and the LOU who issues the LEI.

Q: Do LEIs expire? Must they be renewed?

LEIs expire every year unless they are renewed. This is to make sure that regulators have the most up-to-date information available to identify parties to financial transactions.

GetLEI allows entities to pay for multiple years’ worth of registration in advance for their convenience. GetLEI then assumes the burden of verifying that the information is accurate each year.

Q: If my LEI expires or is not reported on transactional documents, what will happen?

Financial service companies who process transactional documents may be required to report the LEI of the parties to the transaction. If any party entity has not furnished its LEI on the transaction documentation, or if the LEI has expired, the financial service company may refuse to perform its role due to its inability to meet regulatory requirements. In this circumstance, the transaction will most likely fail to close.

Q: How long does it take to get an LEI after I apply for one?

GetLEI usually delivers valid LEIs within 1 to 24 hours of application and receipt of payment.

Q: What address do I use to register my LEI?

An LEI application must include both the address of registration (found on the entity formation documents) and the address of headquarters (where the entity actually does business). These addresses can be the same, but both must be furnished to register an LEI.

Q: How can I check if my LEI is valid?

The validity of an LEI can be checked using the search field at www.glief.org. The GLEIF database is updated once per day around 14:00 CEST.

Q: Why is the bank telling me my LEI is invalid or inactive when I just confirmed and paid for its registration?

Banks and other financial institutions verify LEIs with GLEIF. If your LEI was issued or renewed after 14:00 CEST, the changes might not reflect in the LEI database until 14:00 CEST the next day.

Q: What do the different “Registration Status” and “Validation Sources” entries mean?

The different registration and validation statuses you find on file with the managing LOU mean the following:

Registration Status:

• ISSUED: The LEI registration is valid, and the entity is operating legally as of last verification.
• DUPLICATE: The LEI is determined to have been issued to an entity that already has a valid LEI. A duplicate LEI should not be used.
• LAPSED: The LEI is past its renewal period and any grace period and is no longer valid.
• MERGED: The entity has been acquired or absorbed by another entity with a different LEI. This LEI is no longer valid.
• RETIRED: The entity has terminated operations. This LEI is no longer valid.
• ANNULLED: The LEI was filed in error and is deemed to have never been valid.
• CANCELED: The LEI registration was terminated before registration could be completed.
• TRANSFERRED: The LEI registration was transferred to a different LOU, where it may or may not be on file and valid.
• PENDING_TRANSFER: The LEI is still valid, but the entity has requested that it be transferred to another LOU, and the transfer is still in progress.
• PENDING_ARCHIVAL: The LEI has been transferred to another LOU and the records with the LOU in question are marked to be archived and removed from the LOU’s active records.

Validation Status:

• FULLY_CORROBORATED: Sufficient information was found in authoritative public records to corroborate all the data supplied by the applicant. The record reflects not only the information furnished by the applicant but also public-record data that backed it up.
• PARTIALLY_CORROBORATED: Authoritative public sources have verified some of the data supplied by the applicant, but other records either contradict the data in the application or no corroboration could be found. The record reflects the information provided by the applicant, it cannot all be corroborated by the public record.
• ENTITY_SUPPLIED_ONLY: Sufficient corroboration has not been located in authoritative public records, meaning the data in the LEI record is almost entirely as supplied by the applicant, with no corroboration in the public record.
• PENDING: The verification and corroboration process is not yet complete.

Q: Who gives out LEI codes?

LEIs are issued by LOUs (Local Operating Units) authorized by GLEIF to issue LEIs, store the records of those LEIs, and make them available to regulators and the public.

Q: Who can register an LEI for my entity?

Any person authorized by the entity to register the LEI may do so, whether it be entity officers, employees, controlling interest officers or employees, or authorized third parties.

Q: What are the ELF codes?

ELF refers to “Entity Legal Forms.” As of 1 March, 2018 GLEIF has implemented a system of four-digit standardized alphanumeric codes identifying the entity’s country of formation and type of entity. For example, a Public Limited Company formed in the UK gets the ELF code B6ES.

Q: What happens to my LEI status when various corporate actions are taken?

Different corporate actions have the following impact (if any) on the status of the entity’s LEI:

• Name Change: No change in LEI.
• Change of Registered Address: No change in LEI.
• Change of Headquarters Address: No change in LEI.
• Merger: If one entity survives, both entities keep their LEIs but the absorbed entity’s LEI changes in status to “MERGED.” If a new entity is formed from the merger, a new LEI must be registered.
• Acquisition or Change of Parent Entity: No change in LEI.

Q: For how long is an LEI valid?

An LEI is valid for one year after completion of registration. If that year elapses and no renewal action is taken, the LEI’s status is changed to “LAPSED” and it no longer meets the reporting requirements mandated by regulators.

Q: What is the definition of Level 2 Relationship Data?

Level 2 Relationship Data discloses the ultimate, highest-level parent entity of a registered entity, as well as the direct consolidating parent. Level 2 Relationship Data must be disclosed per directives from GLEIF and LEI ROC issued 1 May 2017.

Q: Can I avoid reporting Level 2 Relationship Data?

Only if you provide an acceptable “exception reason.” Exception reasons include:

• Natural Persons. The entity is controlled by a natural person, not another entity.
• Non-Consolidating. The parent entity or entities do not consolidate financial statements across its subsidiaries for various reasons.
• No Known Person. No person or entity is known to control the entity, as in the case of diversified shareholding.
• Legal Obstacles. The jurisdiction in question may have laws that require the consent of the parent entity before its identity can be disclosed. Not that the registrant entity is required to at least seek the permission of the parent entity. The legal validity of the claim of legal obstacles is not the purview of the LOU, so it does not fall on them to verify it.
• Binding Legal Commitments. The registrant entity and the parent company have a legal agreement not to disclose the identity of the parent entity. The LOU is not responsible for verifying the legality of this agreement.
• Disclosure Detrimental. The disclosure of the parent entity could be detrimental to the parent entity. The grounds to presume detriment must be acceptable under the legal jurisdiction of the entity.
• Detriment not Excluded. The disclosure of the parent entity could be detrimental to the parent entity, or indeterminate that the disclosure would not be detrimental under the applicable laws. The grounds to presume detriment must be acceptable under the legal jurisdiction of the entity.

Applicant entities that do disclose Level 2 Relationship Data must disclose if the parent company has an LEI and provide corroborating data, including the Accounting Period and the Relationship Period.

Q: Can I transfer my existing LEI to GetLEI?

LEIs under the management of one LOU can be transferred to the management of a different LOU at the request of an authorized agent for the entity. Such a request can be submitted using the LEI Transfer. The 20-digit LEI code will not change, but the maintenance obligation of that LEI will pass to the LOU of the transfer.

No transfer fees apply to the transfer of an active and valid LEI. However, lapsed LEIs will incur a renewal fee. Transfers may also take longer than other LOU transactions, as they require coordination between two different LOUs.

Q: Can individuals apply for an LEI?

LEI ROC has enumerated limited conditions under which individual acting in the capacity of a business may qualify for an LEI. In general, however, LEIs are restricted to entities. Individuals cannot register for LEIs.