What is an LEI?

Core Definition: A Legal Entity Identifier (LEI) is a 20-character, alpha-numeric code based on the ISO 17442 standard developed by the International Organization for Standardization. It serves as a globally recognized identifier for legal entities participating in financial transactions.

Definition and Purpose

The Legal Entity Identifier (LEI) provides a standardized, consistent way to identify legal entities involved in financial market activities. Each LEI connects to essential reference information enabling clear and unique identification, thus improving transparency and reducing ambiguity in financial transactions worldwide.

Established following the 2008 financial crisis, the LEI system addresses the critical need for improved counterparty — The other party to a transaction (e.g., a bank, fund, or company) that enters into the financial agreement with you.counterparty: The other party to a transaction (e.g., a bank, fund, or company) that enters into the financial agreement with you. identification and risk management. Endorsed by the G20 and overseen by the Regulatory Oversight Committee (ROC — ROC (Regulatory Oversight Committee) — an international group of public authorities providing oversight of the LEI system.ROC: ROC (Regulatory Oversight Committee) — an international group of public authorities providing oversight of the LEI system.), the system aims to enhance market stability by providing a universal standard for tracking financial transactions across different markets and jurisdictions — The country or legal area whose laws and regulations apply to an entity or activity.jurisdiction: The country or legal area whose laws and regulations apply to an entity or activity..

LEI reference data: Level 1 and Level 2

An LEI isn't just a code — it connects to public reference data that helps markets and regulators identify entities and their relationships. This is commonly described as:

• Level 1 data (Who is Who): core identity data such as legal name, registered address, and jurisdiction.
• Level 2 data (Who owns Whom): relationship data describing direct and ultimate parent entities where applicable.

Entities Typically Requiring an LEI

The requirement or strong recommendation for obtaining an LEI typically applies to entities involved in specific financial activities, particularly those subject to regulatory reporting:

Structure of the LEI Code

The 20-character LEI code follows a defined structure specified by ISO 17442:

The Global LEI System (GLEIS — GLEIS (Global LEI System) — the global framework of rules and institutions that supports issuing and publishing LEIs.GLEIS: GLEIS (Global LEI System) — the global framework of rules and institutions that supports issuing and publishing LEIs.)

The Global LEI System is the framework ensuring the operational integrity and accessibility of LEIs worldwide. Key components include:

• Global Legal Entity Identifier Foundation (GLEIF — GLEIF — the organization that coordinates the global LEI system and maintains data quality in the Global LEI Index.GLEIF: GLEIF — the organization that coordinates the global LEI system and maintains data quality in the Global LEI Index.): A non-profit organization responsible for coordinating the system, ensuring data quality, and managing the network of LEI issuers.
• Regulatory Oversight Committee (ROC — ROC (Regulatory Oversight Committee) — an international group of public authorities providing oversight of the LEI system.ROC: ROC (Regulatory Oversight Committee) — an international group of public authorities providing oversight of the LEI system.): A group of public authorities from around the globe providing governance and oversight of the GLEIS — GLEIS (Global LEI System) — the global framework of rules and institutions that supports issuing and publishing LEIs.GLEIS: GLEIS (Global LEI System) — the global framework of rules and institutions that supports issuing and publishing LEIs..
• Local Operating Units (LOUs — LOU (Local Operating Unit) — an accredited organization that issues/renews LEIs and validates entity data.LOU: LOU (Local Operating Unit) — an accredited organization that issues/renews LEIs and validates entity data.): Organizations accredited by GLEIF — GLEIF — the organization that coordinates the global LEI system and maintains data quality in the Global LEI Index.GLEIF: GLEIF — the organization that coordinates the global LEI system and maintains data quality in the Global LEI Index. to issue LEIs to legal entities, performing validation and ensuring data accuracy according to established protocols.
• Registration Agents — A service provider that helps entities register or renew an LEI (typically in cooperation with an LOU).Registration Agent: A service provider that helps entities register or renew an LEI (typically in cooperation with an LOU).: Organizations assisting entities in accessing LEI issuing services provided by LOUs — LOU (Local Operating Unit) — an accredited organization that issues/renews LEIs and validates entity data.LOU: LOU (Local Operating Unit) — an accredited organization that issues/renews LEIs and validates entity data..