LEI

The LEI system was established by the G20 in response to the 2008 financial crisis to improve risk management and regulatory oversight. LEIs are issued by accredited Local Operating Units (LOUs) under the oversight of the Global Legal Entity Identifier Foundation (GLEIF). The 20-character code includes a four-character LOU code, two reserved digits, a 12-character entity identifier, and two check digits. LEIs are mandatory for many financial transactions, particularly in derivatives markets, and are required for regulatory reporting under various jurisdictions including MiFID II, EMIR, and Dodd-Frank. The system provides transparency about corporate structures and ownership, helping regulators assess systemic risk.