LEI Code

The Financial Supervisory Authority, in its capacity as the competent national authority for the regulation and supervision of capital market operations in Romania, with responsibilities for the protection of consumers of non-bank financial services, reminds all entities that are and will be involved in financial transactions of the obligation to hold the LEI code (Legal Entity Identifier) and requests urgent action from them to comply with this responsibility.

The European Securities and Markets Authority stressed the importance of the LEI Code on 9 October 2017 in a "Briefing Note" published on its website, explaining the main European regulations that make its use mandatory, while mentioning that entities with legal personality must apply for the LEI code, even if they are registered or set up in various legal forms, such as trusts, partnerships, contractual cooperation, or simply governmental or multinational organisations. The document also defines the term "legal entity" by stating that it excludes natural persons but includes those acting in a "business capacity", as explained in the statement released by the LEI ROC on 30 September 2015. Thus, the statement specifies that those persons, acting in a self-employed activity (commercial or non-commercial), evidenced and registered in a business register, are eligible to be identified by the LEI code.

At the same time, ESMA announced on 20 December 2017 on its website that, as of 3 January 2018, it will be moving to implement the requirements concerning customer identification by LEI code in a slightly simplified way, mentioning that for a temporary period of 6 months, investment firms will be allowed to offer financial services involving the obligation to report the transaction to the client, with the strict responsibility to receive, before the transaction is carried out, all documents from the client authorising them to act in order to obtain the LEI code on behalf of the client.

 

Entities eligible to have a LEI Code:

 1.1. 
Financial and non-financial counterparties (legal entities, structures including companies, trusts, charities, governmental and multinational organisations) central counterparties, brokers, reporting entities, beneficiaries, as legally required by European Regulation 648/2012 on OTC derivatives, central counterparties and trade repositories (EMIR), applicable as of 2014, together with all regulations issued to supplement, amend and implement it.

1.2   Issuers of financial instruments, issuers of underlying assets of derivative financial products, holders or operators of trading venues, reporting entities, as defined by law:

Delegated Regulation (EU) 2016/378 laying down implementing technical standards with regard to the timing, format and template of the submission of notifications to competent authorities in accordance with Regulation (EU) No 596/2014 of the European Parliament and of the Council (MAR), applicable as of 2017;

Delegated Regulation (EU) 2016/523 laying down implementing technical standards with regard to the format and template for the notification and public disclosure of managers’ transactions in accordance with Regulation (EU) No 596/2014 of the European Parliament and of the Council (MAR), applicable from 2017;

Delegated Regulation (EU) 2016/1437  supplementing Directive 2004/109/EC of the European Parliament and of the Council with regard to regulatory technical standards on access to regulated information at Union level (Transparency Directive), applicable as of 2017;

Q&A set on data reporting in accordance with MiFIR issued by ESMA.

 

1.3.   Investment firms, reporting entities, investment fund management companies, clients of investment firms, as defined by law:

Directive 2014/65/EU of the European Parliament and of the Council on markets in financial instruments (MiFID II), applicable from January 2018, together with all regulations issued to supplement, amend and implement it;

Regulation (EU) No 600/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the maintenance of relevant data relating to orders in financial instruments (MiFIR), applicable as of January 2018, together with all regulations issued to supplement, amend and implement it;

-   Directive 2011/61/EU on Alternative Investment Fund Managers (AIFMD).

Commission Delegated Regulation (EU) 2017/590 of 28 July 2016 supplementing Regulation (EU) No 600/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the reporting of transactions to competent authorities (RTS 22), applicable from 2018;

Commission Delegated Regulation (EU) 2017/585 of 14 July 2016 supplementing Regulation (EU) No 600/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the data standards and formats for financial instrument reference data and technical measures in relation to arrangements to be made by the European Securities and Markets Authority and competent authorities (RTS 23), applicable as of 2018;

-   Guidlines on trade reporting, order record keeping and clock synchronisation under MiFID II issued by ESMA;

-   Q&A set on data reporting under MiFIR, issued by ESMA.

The LEI is a 20-character alphanumeric code, the structure of which is based on the ISO 17442 standard and is a unique identifier for entities involved in financial transactions. The implementation and administration of the Global LEI System is carried out by GLEIF - the Global LEI Foundation.

 

Obtaining an LEI code is an operation carried out by the applicant entity or by entities specifically empowered by it, and must mainly follow the following steps:

  1. Check the list of entities authorised to issue an LEI code and choose one of them.
  2. Check with the entity chosen to issue the LEI, the set of data belonging to the applicant company, to be submitted in order to obtain the unique identifier (LEI) and submit them.
  3. Payment for the issuance of the LEI code (issuance cost + annual administration cost).

Please note that Depozitarul Central (the Central Depository) is the only institution in Romania authorized to issue LEI codes. Depozitarul Central meets all the accreditation requirements set by GLEIF and is authorized to issue LEI codes for legal entities in Romania as a Local Operating Unit (LOU).
Depozitarul Central assigns LEI codes to legal entities in accordance with the principles agreed by the LEI ROC.

The Global Legal Entity Identifier Foundation (GLEIF) - established in June 2014, which ensures the operational integrity of GLEIS and participates in the implementation and use of the Legal Entity Identifier (LEI), in order to streamline the process of obtaining the LEI Code by entities eligible to identify themselves through it, has introduced the role of ''Registration Agent''.

 Registration Agents may be entities that will proactively want to help their clients (e.g., trading venues for securities issuers, investment firms for their clients), but will not be responsible for issuing LEI codes nor will they have access to edit the LEI code database."

 

General details about the LEI code

   LEI

What is LEI?     

The LEI is a unique, 20-digit alphanumeric code that is a clear and unique identifier for entities involved in financial transactions (legal entities, structures including companies, trusts, charities, governmental and multinational organisations).
Its structure is based on the ISO 17442 standard and the implementation of the LEI leads to the creation of a global base (Global LEI Index), which can be found here.

What are the benefits of implementing LEI globally?

LEI is an essential element that contributes to increasing transparency in global markets where financial transactions take place, reducing the risk associated with them.

How does the Global LEI System work?

The Global LEI System consists of:
 • The LEI Regulatory Oversight Committee (LEI ROC), made up of representatives of a group of global public authorities in January 2013, coordinates and oversees the work of the GLEIF;
 • The Global LEI Foundation (GLEIF), established in June 2014 by members of the Financial Stability Board (FSB) and the G20, is a non-profit, multinational organisation based in Basel, Switzerland, authorised to implement LEI and ensure the integrity of the Global LEI System.
 •  The Local Operating Units (LOUs), represented by entities authorised to issue LEI codes, serve as the primary interface operating the registration of entities involved in financial transactions and issuing the related LEI codes.

Who manages the LEI database?

Global Legal Entity Identifier Foundation (GLEIF). Details about GLEIF can be found here.

  What information is provided by the LEI code?Ce informație este furnizată   de codul LEI?

The Global LEI System database was created mainly to answer 3 questions:
 - Who is who?
 - Who owns whom?
 - Who owns what?

 Why is it necessary to obtain the LEI?

 There are several legal provisions, which require obtaining a LEI code: EMIR, Transparency Directive (TD), MAR, AIFMD, MiFID II, MiFIR, together with all the regulations issued to supplement, amend and implement them.

   Who is obliged to obtain the LEI?

 1. Investment firms
 2. Credit institutions
 3. Investors, with legal personality, involved in financial transactions, carried out in regulated and OTC markets
 4. Issuers of financial instruments and underlying assets of derivatives
 5. Financial and non-financial counterparties
 6. Central counterparties
 7. Reporting entities
 8. Holders or operators of trading venues

  Who is authorised to issue the LEI?

 The LEI Regulatory Oversight Committee (LEI ROC) is the competent entity to authorise issuers of LEI codes, a list of which can be found here.

 How much does it cost to issue a LEI?

 There are 2 costs involved in obtaining a LEI:
  - The fee for issuing the LEI code, which has a different value depending on the issuing entity
  -  The annual LEI code data management fee, which differs depending on the issuer of the LEI code chosen.

 Who can apply for a LEI?

 The entity required by the legal provisions in force to have a LEI code, or any other entity specifically authorised for this purpose.

   How can LEI be obtained?

 1. By checking the list of entities authorised to issue an LEI code and choose one of them.

 2. By checking with the entity chosen to issue the LEI, the set of data belonging to the applicant company, to be submitted in order to obtain the unique identifier (LEI) and submit them.

 3. By paying for the issuance of the LEI code (issuance cost + annual administration cost).