The issue of legal entity identifier
is an important matter in India. It has become a basic requirement for doing global business and financial transactions. Legal entities require this code for identification and recognition in the global arena. If you are in India and you belong to any global organization, you will need to know a thing or two about legal entity identification. Understand the definition, the use, and the process of getting this legal code so that you can run the international business smoothly. Below is all you need to know about the what, the how, and the why of LEI.
What is a Legal Entity Identifier?
A legal Entity Identifier is a unique 20-digit code that is given to a legal entity to provide basic information like name, address, and also the type of the entity. It is used to locate entities on the global database and make it easier to conduct global business. The LEI code is a combination of letters and numbers which has become a legal requirement for many companies in global trade.
How it Works
The LEI code is uniquely designed to identify individual legal entities on the global financial platform. Since businesses share names, the code makes it easier to identify a particular entity by number and not by name. It is a more precise standard for identifying entities in the bid to promote transparency in commerce. Each LEI is unique to an entity and so if a customer or business partner is interested in a certain organization, they can easily find it.
It is an international ISO standard so all necessary information is published and availed to all. Entities like limited companies, trusts, and organizations provide legitimate information and enjoy the advantage of unique global identification. They can easily and legitimately trade internationally and conduct their financial transactions freely. If you are conducting your international business from India, then acquiring this number is a legal requirement.
How to get LEI in India
The process of obtaining the LEI code in India is simple and straight forward. As long as you are eligible for this code, then you can get it in less than 24 hours. The registration process is done online by filling a form and submitting the necessary information. Below is a step-by-step process of obtaining the LEI code in India:
Benefits of Legal Entity Identifier
- Visit a legitimate LEI registration website in India, such as LEI Register, and click on the registration button. At this stage, you will be required to fill out your contact details as the applicant. This is what they will use to contact you if necessary.
- Fill in the details of the entity that requires the LEI. The information here includes the address, name of the legally responsible person be it the director, CEO, or any other, and so on.
- Provide the level 2 data which refers to the information about the parent company. If the organization in need of the LEI is a ranch of a larger organization, you may need to give the mother-company details.
- Upload the relevant documentation and submit your LEI application form. Whatever you sent is cross-matched with that of India’s local companies’ registry to see if it is a match. If the company cannot be found, you will be required to provide supporting documentation for verification.
- After applying, choose your mode of payment and complete the application. One of the LEI worldwide team members reviews your submission then if all is well you receive your code within a few hours.
- It provides a clear and speedy global business identification method
- The single and standardized database offers accurate and freely accessible business data
- LEI enables better data sharing to speed up international business processes ad boost international trade
- This unique code eliminates confusion where different businesses share a name
International business in India is swiftly becoming very lucrative. That means local businesses must position themselves strategically to benefit maximally from this trade. Obtaining the LEI code is one of the ways of positioning your business in the global arena. The insights discussed here will help you to understand why you need the code and how to get it in India.
Disclaimer: The views, suggestions and opinions expressed here are the sole responsibility of the experts. No Forbes India journalist was involved in the writing and production of this article.