Legal Entity Identifier for cross-border transactions
RBI published on 10 December 2021 that entities must now register for a Legal Entity Identifier (LEI) code for cross-border transactions. The last date to register for the LEI code has been set for 1 October 2022.
LEI shall be recorded for all non-individual NEFT / RTGS messages/transactions.
Once an entity obtains an LEI code, it must be reported in all transactions, regardless of size.
“In order to further harness the benefits of LEI, it has been decided that AD Category I banks, with effect from October 1, 2022, shall obtain the LEI number from the resident entities (non-individuals) undertaking capital or current account transactions of ₹50 crores and above (per transaction) under FEMA, 1999. Further, AD Category I banks may encourage concerned entities to voluntarily furnish LEI while undertaking transactions even before October 1, 2022. Once an entity has obtained an LEI number, it must be reported in all transactions of that entity, irrespective of transaction size.” – RBI said in the circular.
What is an LEI?
The Legal Entity Identifier (LEI) is a 20-character alpha-numeric code used to identify parties to financial transactions worldwide uniquely. A company’s LEI data is publicly available, free of charge, and can be accessed by anyone through the LEI database. This provides a more transparent global marketplace and offers businesses a one-stop approach to identifying legal entities, potentially taking the complexity out of business transactions.
Entities can obtain an LEI from Local Operating Units (LOUs) or Registration Agents accredited by the Global Legal Entity Identifier Foundation (GLEIF), the body tasked to support the implementation and use of LEI.
LEI Register is an accredited Registration Agent with Ubisecure Oy (RapidLEI). Since early 2018, we have been helping legal entities apply for new LEI codes or transfer and renew existing LEI codes. We have successfully pursued our goal of making the LEI registration process simple, automated, fast, and affordable.
At LEI Register, we keep our profit margins low and believe in building long-term business relationships. Provide a same-day LEI issuance facility, live chat, and toll-free support seven days a week, active until 11 pm.
How to register an LEI?
The entities can register themselves in 3 simple steps:
- Fill in the application form with the entity details at https://www.legalentityidentifier.in/
- Upload the necessary documents & select the validity of the LEI code.
- Proceed with the payment.
The adoption of LEIs in India
The Global LEI System (GLEIS) was developed by the G20 in 2011 in response to the 2008 global financial crisis. This crisis made the need for a more transparent financial system evident. The purpose of the LEI code is to allow the identification of any organization or legal entity in a worldwide database.
The adoption of LEI has grown at a rapid pace in India as compared to our global peers.
According to GLEIF, the number of entities having an LEI code can be found below:
| Year | 2017 | 2018 | 2019 | 2020 | 2021 |
| No. of entities having an LEI code | 2152 | 15,770 | 14,524 | 14,853 | 29,461 |
