ESMA Stressing LEIs Under MiFID II, Urging Groups to Obtain Compliance
- LEIs are central to matching and aggregating market data obligations under MiFID II.
The MiFID II countdown is now in full swing, with the January 3, 2018 implementation date quickly approaching. Ahead of the date, European Securities and Markets Authority (ESMA) has released its latest documentation regarding Legal Entity Identifier (LEI) requirements under the new regime.
An LEI is a 20-digit, alpha-numeric code that enables transparent identification of legal entities participating in financial transactions. Under MiFID II, LEIs are needed by firms to fulfil their reporting obligations, which are of particular note in terms of matching and aggregating market data.
LEIs are a common component of many existing EU regulations and directives, including European Markets Infrastructure Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term (EMIR), Market Abuse Regulation (MAR), Capital Requirements Regulation (CRR), and several others. In preparation for MiFID II, many venues have also reconciled their LEI obligations, leading to rollout of several new products over the past few months.
Urgent action recommended
Given the previous implementations of other requirements such as EMIR, ESMA is wasting no time in urging firms to maintain full compliance under the new MiFID II requirements. This entails multiple steps to achieve full satisfaction of LEI obligations.
Steven Maijoor, ESMA
Steven Maijoor, ESMA Chair, commented: “This is not a difficult process, if you make the effort now you can obtain your LEI within a short time frame, it costs a few hundred euros and will save you time and expense in the long run, while providing comfort to your clients, counterparties and regulators.”
ESMA’s stressing of LEIs represents its continued push towards broader market transparency. LEIs are an integral factor of the new regulations, given that they constitute a unique identifier for all entities participating in financial transactions that can also be used on a cross border basis.
Broadly speaking, this entails a free and open database that is updated on a daily basis. In doing so, this framework provides a well-defined structure for identifying potential levels of exposure, while also shoring up Risk Management Risk Management One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, Read this Term of financial transactions, and some of the strongest market surveillance coverage to date.
“LEIs play a key role under the new MiFID data-reporting regime as well as being essential in supporting regulators work on transparency and market surveillance. It is vital that investment firms and trading venues make the necessary efforts to obtain their LEIs in good time,” added Mr. Maijoor.
How to obtain the LEI
Groups interested in obtaining an LEI can follow a short process by accessing the Global LEI Foundation (GLEIF) website. By following the outlined steps, any participating company can garner an LEI within 24 to 48 hours pending the issuer.
The MiFID II countdown is now in full swing, with the January 3, 2018 implementation date quickly approaching. Ahead of the date, European Securities and Markets Authority (ESMA) has released its latest documentation regarding Legal Entity Identifier (LEI) requirements under the new regime.
An LEI is a 20-digit, alpha-numeric code that enables transparent identification of legal entities participating in financial transactions. Under MiFID II, LEIs are needed by firms to fulfil their reporting obligations, which are of particular note in terms of matching and aggregating market data.
LEIs are a common component of many existing EU regulations and directives, including European Markets Infrastructure Regulation Regulation Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Like any other industry with a high net worth, the financial services industry is tightly regulated to help curb illicit behavior and manipulation. Each asset class has its own set of protocols put in place to combat their respective forms of abuse.In the foreign exchange space, regulation is assumed by authorities in multiple jurisdictions, though ultimately lacking a binding international order. Who are the Industry’s Leading Regulators?Regulators such as the UK’s Financial Conduct Authority ( Read this Term (EMIR), Market Abuse Regulation (MAR), Capital Requirements Regulation (CRR), and several others. In preparation for MiFID II, many venues have also reconciled their LEI obligations, leading to rollout of several new products over the past few months.
Urgent action recommended
Given the previous implementations of other requirements such as EMIR, ESMA is wasting no time in urging firms to maintain full compliance under the new MiFID II requirements. This entails multiple steps to achieve full satisfaction of LEI obligations.
Steven Maijoor, ESMA
Steven Maijoor, ESMA Chair, commented: “This is not a difficult process, if you make the effort now you can obtain your LEI within a short time frame, it costs a few hundred euros and will save you time and expense in the long run, while providing comfort to your clients, counterparties and regulators.”
ESMA’s stressing of LEIs represents its continued push towards broader market transparency. LEIs are an integral factor of the new regulations, given that they constitute a unique identifier for all entities participating in financial transactions that can also be used on a cross border basis.
Broadly speaking, this entails a free and open database that is updated on a daily basis. In doing so, this framework provides a well-defined structure for identifying potential levels of exposure, while also shoring up Risk Management Risk Management One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, One of the most common terms utilized by brokers, risk management refers to the practice of identifying potential risks in advance. Most commonly, this also involves the analysis of risk and the undertaking of precautionary steps to both mitigate and prevent for such risk.Such efforts are essential for brokers and venues in the finance industry, given the potential for fallout in the face of unforeseen events or crises. Given a more tightly regulated environment across nearly every asset class, Read this Term of financial transactions, and some of the strongest market surveillance coverage to date.
“LEIs play a key role under the new MiFID data-reporting regime as well as being essential in supporting regulators work on transparency and market surveillance. It is vital that investment firms and trading venues make the necessary efforts to obtain their LEIs in good time,” added Mr. Maijoor.
How to obtain the LEI
Groups interested in obtaining an LEI can follow a short process by accessing the Global LEI Foundation (GLEIF) website. By following the outlined steps, any participating company can garner an LEI within 24 to 48 hours pending the issuer.