bullet Legal Entity Identifier (LEI)

A Legal Entity Identifiers (LEI) - is a identifier associated with a single corporate entity that identifies that entity in the financial market. In essence, LEIs constitutes a “social security number” system for entities. Although no common entity ID convention exists in the market today, a range of regulatory initiatives are driving the creation of a universal LEI standard for financial markets.

LEI will help enable organizations and regulators to more effectively measure and manage risk while providing substantial operational efficiencies and customer service improvements.

The FSB LEI Expert Group has been working on identifying the key issues and developing framework solutions.The FSB has, however, decided to provide early clarity on two technical points.First, the Expert Group has agreed that a 20-character alphanumeric code is a good basis for the global LEI code. Second,the eligibility criteria as well as the reference data that the regulatory community views as essential and, consequently, would require to be associated with the identifier.For more information on the technical features of LEI click here.

ISDA and the industry are committed to promoting widespread adoption of the global LEI.

The CFTC Interim Compliant Identifier (CICI), as its name implies, is an interim identifier that will be used in recordkeeping and reporting under CFTC jurisdiction. The Commission is participating in an international process, coordinated by the Financial Stability Board (FSB), to establish governance principles and technical requirements for a global legal entity identifier (LEI). Until the FSB endorses the recommendations, the CFTC is referring to the identifier to be used in reporting as the CFTC Interim Compliant Identifier (CICI). The Commission anticipates that the CICI will transition into the global LEI, and be referred to as the LEI.

CICI Utility:

LEI presentation:

Timeline and Milestones:

  • August 2012

    DTCC and SWIFT launch CFTC Interim Compliant Identifier (CICI) utility.

  • Fall 2011 to June 2012

    The industry recommended DTCC-ISO-SWIFT-ANNA alliance implements an LEI utility.

  • July 2011

    The trade associations present an industry recommendation for the organizations that they believe are best suited to operate a global LEI.

  • Spring 2011

    The trade associations release of a comprehensive set of requirements for establishing the legal entity identification system. A Request for Proposal (RFP) is issued, followed by a vendor selection process to identify one or more solution providers best suited for delivering the global LEI solution.

  • January 2011

    A coalition of financial-services trade associations (the “Trade Associations”) came together to initiate the process of developing requirements for the Global LEI Solution, identify potential solution provider(s), and drive consensus among the global financial services community.

LEI Representation in FpML

LEI Representation - As per the ISO 17442 standard, the LEI will be 20 characters: 18 alphanumeric characters + 2 numeric check digits. LEIs will be referenced in FpML by overriding the default partyIdScheme URI with a new URI that points to the LEI standard or (draft) ISO Standard 17442.
The new URI is http://www.fpml.org/coding-scheme/external/iso17442

The FpML syntax is shown in the below XML snippet:
<party id="party1">
<partyId partyIdScheme="http://www.fpml.org/coding-scheme/external/iso17442">ZNHTL6O2WODTKMPF1Z48</partyId>
<partyName>Bank Y</partyName>
<organizationType>SwapDealer</organizationType>
</party>

At some point (TBD) we may decide to default the partyIdScheme to point the iso17442 URI, at which time the partyIdScheme could be omitted i.e.,
<partyId>ZNHTL6O2WODTKMPF1Z48</partyId>
but for now the partyIdScheme URI needs to be explicit.

CICI Representation

The CICI is represented in FpML using a different URI: http://www.fpml.org/coding-scheme/external/cftc/interim-compliant-identifier

<partyId partyIdScheme="http://www.fpml.org/coding-scheme/external/cftc/interim-compliant-identifier">VTOUP9FCHUXIINML4787</partyId>

Resources:

Comment Letters and Submissions: