Legal Entity Identifiers
Under the European Union’s revised Markets in Financial Instruments Directive II (MiFID II), every ‘legal entity’ will need to register and obtain a 20-character alphanumeric reference code known as a Legal Entity Identifier (LEI) before it can trade on financial markets in the UK. This will take effect from 3rd January 2018.
The LEI initiative, endorsed by the G20, is designed to create a global reference data system that uniquely identifies every legal entity or structure, in any jurisdiction, that is party to a financial transaction. Legal entities include Companies (Public and Private), Charities, Unincorporated Bodies, Trusts (but not Bare Trusts) and Pension Funds (but not Self-Invested Personal Pensions).
Investment firms who are subject to the MiFID II transaction reporting obligations will be required to report all transactions in financial instruments to the UK regulator, the Financial Conduct Authority (FCA), and therefore will not be able to execute a financial transaction on behalf of a legal entity who is eligible for an LEI and has not obtained one. It is the legal entity itself that is responsible for obtaining an LEI, but at Charter Tax, we can apply for the LEI on your behalf, should you require one, providing we include a signed registrant authorisation form with our application.
An LEI is available from bodies accredited by the ‘Global Legal Entity Identifier Foundation’ (GLEIF) or bodies endorsed by the ‘Legal Entity Identifier Regulatory Oversight Committee’ (LEIROC), as an authorised Local Operating Unit for the global allocation of LEIs. There is a registration fee and ongoing annual renewal fees.
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If you need any more information or would like us to prepare an application on your behalf contact our team at Charter Tax today.
The information provided by Charter Tax Consulting Limited is general in nature and does not constitute specific tax advice. Professional advice should be sought before deciding on a course of action, or refraining from a certain action, arising from the above information. Tax legislation changes regularly and information contained herein is provided based on legislation as at 15 December 2017
Taxation planning concerns the application of complex statute and case law to future events. Accordingly, however expert the opinion given, it is always possible that the Courts will take a different view of the application of the law. We undertake to apply reasonable care and skill in the provision of advice. We do not guarantee that tax planning steps will in all circumstances achieve a certain legal effect.