What are CySEC LEI acquisition requirements? Updated circular

CySEC issued two new circulars today, one of which directs financial firms about the requirements of acquiring a LEI. Let's go through the latest document to see what are CySEC LEI acquisition requirements? 

20 September, AtoZForex - The Cyprus Securities and Exchange Commission (CySEC) has issued directives for Forex brokers on acquiring LEI number ahead of EU MiFID II rules effective date. EU MiFID 2 is set to take effect on January 3, 2018.

Legal Entity Identifier (LEI) is a unique identifier for persons that are legal entities or structures including companies, charities, and trusts. LEI is a 20-character, alpha-numeric code, to uniquely identify legally distinct entities that engage in financial transactions. As a part of MiFID II, all legal entities that trade with an EU-licensed broker need to be identified by their LEI.

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What are CySEC LEI acquisition requirements?

The requirements of LEI acquisition are mentioned in Article 27 of MiFIR. It points out that trading venues (TVs) must provide their competent authorities with identifying reference data relating to financial instruments. Also, the same article says that systematic internalisers (SIs) must provide their competent authorities with reference data of the following instruments that are traded on their systems.

The regulator also highlights assistance in the context. It mentions that ESMA issued a relevant Q&A (Question 2) on 3 April 2017. As regards, TVs or SIs may take actions in the cases if the LEI of the issuer cannot be obtained. In particular, ESMA advises the TVs and SIs to inform the issuer in order to comply with the above-mentioned requirements.

In addition, ESMA advises TVs and SIs that the GLEIF has introduced the concept of ‘Registration Agent’. This facility will enable TVs and SIs to assist the issuer applying for the LEI to access the network.

CySEC urges all issuers to acquire a LEI number

Although, Cyprus Stock Exchange (CSE) has proceeded to an agreement with the London Stock Exchange (LSE). The deal aims to issue LEI to interested legal entities, including Issuers. The CSE provides the ability to acquire a LEI code with the Assisted Registration process. Further information on this service, can be found on CSE website.

Further information about identifying financial instruments data CySEC had already issued on September 15, 2017.

CySEC urges all issuers to acquire a LEI as soon as possible in order the transaction reporting requirements to enter into force as of 3 January 2018. It stressed that the submission of the identifying reference data relating to financial instruments that ESMA has started since July 2017. Please find the official CySEC document here.

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