According to the EU Directive MiFID II that came into effect from 3rd of January, 2018, organizations such as charities, Trusts, and Funds are required to have an LEI number if they to continue operating in the financial markets.
A client who is a legal entity or structure, including a charity or trust, need to make arrangements to obtain an LEI code if it wants the investment firm to continue to act on its instructions or make a decision to trade on its behalf from 3 January 2018 onwards.
So, a Trust, similarly to Funds, with no LEI will find it hard or almost impossible to operate in these markets.
Is it easy for a trust to get a Legal Entity Identifier?
Registering a LEI is a straightforward process of applying on our website, where our form will guide you step by step and in under few hours you will receive LEI code associated with your Trust.
What is the primary purpose of a Legal Entity Identifier?
A Legal Identity Identifier (LEI) refers to a unique reference code required by every legal entity involved in financial transactions within and outside its native country. Trusts are also legal entities, so they essentially need to acquire a Legal Entity Identifies if they are to smoothly run their operations, especially in countries where having an LEI is a requirement.
Your unique LEI code is like a business registration number that entities and other stakeholders of your Trust can use to get basic information about your company. Some of the information that can be extracted out of your LEI includes parent organizations (if any), legal addresses of the Trust, ownership, and ownership structure.
Yes, it is possible to get all this information about a company by doing a Google search. However, most of the information on the internet cannot be trusted. So, having your unique LEI code will enhance the trust of those you want to do business with.
Benefits of having a Legal Entity Identifier
Just like the name, a Trust has to be trusted by the public and all its stakeholders. One of the ways you can build Trust within the public and among your stakeholders is by acquiring an LEI number for your Trust. It would be hard for anyone to give away their property to be run by a Trust with no Legal Entity Identifier.
One of the easiest ways to grow your Trust is through partnering with other trusts and organizations within or outside your country. It is much easier to get such partnerships if you have an LEI number.