Did you know that there is a new LEI search tool? So with this tool, you can find a contemporary Legal Entity Identifier and connect to the global Legal Entity Identifier database. This tool will help companies to check their LEI statuses and with a possible instant renewal in case of expiry.
This article will give insights into who needs LEI in the UK and how to obtain one, and the renewal procedures. Here is what you need to know on LEI for UK companies.
What Group/category requires LEI in the UK?
First off, let me begin by mentioning that companies in the UK may not need an LEI as provided by the law. The law doesn’t tie any company or sole trader to have an LEI; however, it’s not a bad idea to have one, especially when cross-border trade is involved. LEI is being adopted as a global standard, and yes, you will need one to quickly and smoothly trade in the international markets.
Local regulations require companies and sole traders to register their entities lawfully when dealing in the financial markets. Laws such as Mifid II and EMIR are satisfied by the companies/sole traders, otherwise meeting their local reporting obligations.
There is a lot of information on who falls into what category, and you can always confirm to see where you belong. This will catalyze your decision-making to acquire a LEI code/number when you are in the UK.
BREXIT will affect trading globally, and most traders are rushing to acquire their LEI codes. LEI codes are not mandatory, but you can’t keep guards down with the changing patterns in trade.
LEI Acquisition Process In The UK
Acquiring an LEI code is a quick and straightforward process not only in the UK but from anywhere else globally. The process is fast and can’t take you more than 5 minutes!
So what if your Company is a branch or owned by a more prominent company? What should you do? It’s important to note that it’s not a legal obligation to have that information on the LEI record, but you could still record that. If you decide to acknowledge the parent company on your documents, then it’s good to keep the annual reports for proof purposes. It’s only through consolidated accounts that you can show that your Company is just a branch or owned by the parent company.
Also, if the company documents don’t match what the registry has, it’s prudent to back yourself with supporting documents such as the Company’s house extract.
What Are the Benefits of Having An LEI Code?
As stated above, LEI is not mandatory, but it doesn’t mean that it lacks any benefits. LEI provides the companies/sole traders with the necessary credibility boost. We all know what that means to business, right? This doesn’t give your business a good reputation and brings along some long-term clients with it.
Another benefit linked with having a LEI code is the International Identity Card that keeps your business recognizable to any prospects. Along with the recognition comes identity security that terminates any flaws and misunderstandings between brands and trademarks.
It is also important to point out that LEI can be optional, but a lapsed LEI could cost your company a lot. For Instance, Stanley Morgan was fined $5 million due to incomplete and failed LEI reporting between 2013 and 2018.
It’s possible not to realize that your LEI has lapsed, and that problem is now being solved by the new LEI search tool. Want to stay on the safe side with the Commodity Future Trading Commission? Then renew your LEI code in time, and with the new search tool, you can know your LEI status in a matter of minutes.