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SEBI has introduced the Legal entity identifier system
May 09, 2023
The Securities and Exchange Board of India (SEBI) has introduced the Legal Entity Identifier (LEI) system for issuers that have listed or are planning to list non-convertible securities, securitized debt instruments, and security receipts. This unique global identifier for legal entities participating in financial transactions aims to create a global reference data system that uniquely identifies every legal entity that is a party to a financial transaction.
The LEI code is a 20-character code that identifies legally distinct entities that engage in financial transactions. Its purpose is to provide a unique global identifier for legal entities participating in financial transactions. The LEI system helps to improve transparency in financial markets and mitigate systemic risk by providing a comprehensive and standardized database of legal entity information.
The Reserve Bank of India (RBI) mandates non-individual borrowers having an aggregate exposure of above ₹25 crore to obtain the LEI code. SEBI has specified the deadline for issuers having outstanding listed non-convertible securities, securitized debt instruments, and security receipts to obtain and report the LEI code to the centralised database of corporate bonds and depositories respectively by September 1.
In addition, issuers who plan to list non-convertible securities, securitized debt instruments, and security receipts after September 1, must report their unique global identifier code to the central database of corporate bonds and depositories during the allocation of the International Securities Identification Number (ISIN).
Important Links:
- 4-IN-1 Professional Diploma in Banking, Financial Services & Insurance (PDBFSI): https://tscfm.org/courses/4-in-1-professional-diploma-in-banking-financial-services-insurance-pdbfsi/