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Legal Entity Identifier – How to Obtain, Renew, Download LEI Code
In the modern corporate world, due to the development of technology, businesses engage in high-level transactions that involve large sums of money. This increases the risk for businesses and financial institutions. The worldwide financial crisis of 2007-08 brought to light the need for transparency in financial transactions, as some corporations engaged in deceptive practices to raise funds and attract investors, resulting in a disaster. Thus, the Legal Entity Identifier system was put in place to address this issue.
Legal Entity Identifier
The LEI is a 20-character alphanumeric code, designed in accordance with ISO 17442 by the ISO. Thanks to the LEI, essential data about participants in a financial transaction can be easily accessed. It works as a global registry, offering transparency and all the details of the ownership structure and associated information of those involved for everyone’s benefit.
Structure of the LEI Code
The LEI code is not complicated due to its four basic principles: being global, assigning each legal entity a single identifier, being publicly available and free for everyone to use, and having a high quality of data. It consists of 20 characters, with the first four assigned by the ROC Secretariat, two reserved characters (00), a 12 character reference assigned by the Local Operating Unit, and two check digits under ISO 17442.
How Does One Obtain an LEI?
The LEI code can be obtained by following the steps mentioned below:-
Document list: Log into the online portal https://www.ccilindia-lei.co.in/ and go to the “Downloads” section. There you can find the documents and their corresponding formats which are necessary to submit, based on the legal structure of the entity.
Self-registration on the online portal: An individual must be chosen as the authorised individual to oversee and complete the process of attaining the LEI Code. This authorised user may be chosen through a resolution, power of attorney, or voluntarily. Only this authorised user is granted permission to create an account, utilizing their official email address and filling out the online form. Those who are authorised include:
- Primary/Main user who submits the online application form. – Authorised User
- Name and email id of the authorised officials named in the online form.
- Secondary User – Name and email id of the secondary authorised officials named in the online form.
The LEI registration form consists of 5 pages in total, including the payment gateway.
Company Information Page: This page contains all the necessary information about the company.
The information of the main company should be entered on the Holding Company Page.
When the company is a subsidiary of another company, the information for both the parent and the ultimate parent should be included on the Ultimate Parent Page.
The fee for filling out the form should be paid after it has been finished.
This Upload Page allows you to submit the necessary documents. After filling out the form, you can choose to pay online right away or opt to make a demand draft. When you select one of the online payment options and press the “Save and Submit” button, LEIL (Legal Entity Identifier India Limited) will provide you with a reference number. An email will also be sent to you, containing a list of documents that need to be submitted to LEIL. When you choose the demand draft option and click the “Save and Submit” button, the reference number and email will be generated immediately.
Submission of the documents.
Verification process: The LEIL will check the documents submitted, either electronically or physically, in addition to the application form. Should it be necessary, the LEIL may request for further documents. The applicant entity might also be instructed to make changes to the online application form by the LEIL.
Upon completion of the form and documents, the LEI code will be assigned, and an email containing the code will be sent to the entity. This code needs to be provided to the banks.
Renewal of the LEI Code
An LEI Code typically lasts one year, and to keep using it, you must renew it on the same online portal. Simply choose the “Modify and Renewal” option, not “Register” this time. Any changes must be made by an authorized person. Once the LEI Code is entered, all the information will show up automatically. After that, check the “LEI Renewal” box, fill out the form, pay the fee, and submit the documents. Once all of this is done, the LEI Code will be renewed, and you will receive confirmation.
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FAQs on Legal Entity Identifier
It is mandatory for organizations conducting transactions in the interest rate, foreign exchange, and credit derivative markets to obtain a Legal Entity Identifier (LEI). The Reserve Bank of India (RBI) has also made it compulsory for companies and organizations with an aggregate credit exposure of more than 50 crore rupees in both fund-based and non-fund-based categories to acquire an LEI.
The Legal Entity Identifier (LEI) is a type of reference code, similar to a bar code, that is employed in different markets and jurisdictions to identify a distinct legal entity that is involved in a financial transaction.
Legal entities involved in controlled financial activities must obtain LEIs according to 116 international rules. Examples of such entities include investment funds, trusts, and insurance firms.
A Legal Entity Identifier (LEI) can be obtained from either a Local Operating Unit (LOU) or a Registration Agent. To get an LEI, legal entities must register with a service provider like an LOU, Registration Agent, or any other LEI service provider. In order to receive an LEI, the registration form must be filled out.
Legal Entity Identifier India Limited (CIN- U74900MH2015PLC268921), a subsidiary of The Clearing Corporation of India Ltd. wholly owned by them, operates as a Local Operating Unit (LOU) in India to issue Legal Entity Identifiers (LEIs) that are compatible with a global standard.