The Global Legal Entity Identifier Foundation (GLEIF) today launched the accreditation program that confirms the suitability of organizations issuing Legal Entity Identifiers (LEIs) to legal entities engaging in financial transactions.
LEIs enable clear and unique identification of these entities. Organizations currently issuing LEIs based on previous authorization procedures must become GLEIF accredited, as must any organization wishing to issue LEIs in the future.
Accreditation is a rigorous evaluation process carried out by GLEIF. Candidate organizations must meet the requirements set out in the Master Agreement, which is the contractual framework governing the relationship between GLEIF and LEI issuing organizations. The Master Agreement was finalized following an in-depth review process involving GLEIF, representatives of existing LEI issuing organizations and the LEI Regulatory Oversight Committee (ROC). The LEI ROC is a group of over 60 public authorities from more than 40 countries established in January 2013 to coordinate and oversee the Global LEI System.
Before the launch of the GLEIF accreditation program, the LEI ROC was responsible for endorsing organizations as LEI issuers. GLEIF assumed the responsibility of evaluating candidate organizations with the conclusion of a Memorandum of Understanding between the LEI ROC and GLEIF. GLEIF published the Memorandum of Understanding, the Master Agreement and related accreditation documentation on its website at www.gleif.org on 7 October 2015.
The LEI ROC will not accept new applications for endorsement as LEI issuers. Each LEI issuer endorsed by the LEI ROC to date will apply to become GLEIF accredited. They will be subject to the same evaluation criteria as any new organization seeking accreditation. Only GLEIF accredited organizations will be authorized to issue LEIs.
Organizations currently operating based on LEI ROC endorsement will continue issuing LEIs while they undergo the GLEIF accreditation process. All LEIs issued remain valid regardless of whether the issuer succeeds in becoming GLEIF accredited or not. In the event that an organization currently issuing LEIs should fail to meet the requirements of GLEIF accreditation, the LEIs issued by that organization would be transferred to a GLEIF accredited issuer.
LEI issuers - also referred to as Local Operating Units (LOUs) - supply registration, renewal and other services, and act as the primary interface for legal entities wishing to obtain an LEI. A legal entity is not limited to using an LEI issuer in its own country; instead, it can use the registration services of any LOU that is accredited and qualified to validate LEI registrations within its jurisdiction.
GLEIF will verify annually whether organizations accredited to issue and maintain LEIs continue to meet the requirements with regard to service orientation and quality set out in the Master Agreement.
GLEIF CEO Stephan Wolf comments: “Implementation of the GLEIF accreditation program is the first of several GLEIF services rolling out in the next six months to support its partners in the Global LEI System in optimizing the quality, reliability and usability of LEI data.”
GLEIF Chairman Gerard Hartsink adds: “With the conclusion of the Memorandum of Understanding between GLEIF and the LEI ROC, GLEIF has taken on greater responsibility for ensuring that the LEI becomes a broad public good. Use of the LEI increases transparency and stability of financial markets. It also generates tangible benefits for businesses including reduced counterparty risks.”