Legal entity identifier
LEIAlso called ISO 17442 identifier
A legal entity identifier is a 20-character code, defined by ISO standard 17442, that uniquely identifies a legal entity taking part in financial transactions. Each code links to public reference data such as legal name, registered address and parent companies. Regulators require LEIs in trade, transaction and supervisory reports.
How it works
Firms obtain an LEI from a local operating unit accredited by the Global Legal Entity Identifier Foundation, which the Financial Stability Board set up in 2014. The issuer checks the entity against official registers. The code must be renewed every year, or its status becomes lapsed. Level 1 data shows who an entity is. Level 2 data shows who owns whom.
LEIs let regulators and firms link exposures to the same counterparty across systems and borders. Banks use them to aggregate credit risk and to match clients in onboarding and screening. Under MiFIR an investment firm cannot report a transaction for a legal entity client without a valid LEI, which in practice means it cannot trade for that client.
The rules
Requires legal entity clients and counterparties to be identified by LEI in transaction reports, so firms cannot report trades for clients without one.
EU investment firms and trading venuesUpdated derivative reporting fields, requiring counterparties and other entities to be identified by LEI in reports to trade repositories.
Counterparties reporting derivatives under EMIRDefines the 20-character LEI code structure and the reference data attached to each identifier.
LEI issuers and users worldwideCommon questions
How long is an LEI valid?
An LEI does not expire, but its reference data must be renewed every year. If the holder does not renew, the record shows as lapsed. Many regulators and trading venues expect a current, issued status.
Who needs an LEI?
Any legal entity that trades securities or derivatives through a regulated firm in the EU or UK, or reports derivatives, needs one. Funds, companies, trusts and charities can all hold LEIs. Individuals use national identifiers instead.
What is the difference between Level 1 and Level 2 LEI data?
Level 1 data answers who is who: legal name, address and registration details. Level 2 data answers who owns whom, recording the direct and ultimate accounting parents of the entity where they exist.
