GFMA Legal Entity Identifier Webinar MIFID II and Other Important LEI Matters

Transcription

1 GFMA Legal Entity Identifier Webinar MIFID II and Other Important LEI Matters Friday, October 13, 2017

2 Panelist Roster o Moderator Robin Doyle, MD, Office of Regulatory Affairs, JP Morgan o Giulia Ferraris, Policy Officer, European Securities and Markets Authority (ESMA) o Clare Rowley, Head of Business Operations, Global Legal Entity Identifier Foundation (GLEIF) o Teri Brunsman, Senior Counsel, Invesco o James Fertitta, Vice President, Goldman Sachs o Eugene Ing, Executive Director, Global Market Entity Identifier Utility (GMEI) o Brid Nic Fhloinn, LEI Executive, Irish Stock Exchange o Pritha Sharma, Manager of LEI, London Stock Exchange 2

3 Audience Poll # 1 WHAT TYPE OF ORGANIZATION DO YOU BELONG TO? Service Provider 25% Buy Side 29% Sell Side 19% Other 20% Regulator 7% 3

4 Audience Poll # 2 WHERE ARE MOST OF YOUR CUSTOMERS/CLIENTS LOCATED Other 8% Asia 6% North America 43% Europe 42% Middle East 1% 4

5 Audience Poll # 3 WHAT CHALLENGES IS YOUR ORGANIZATION EXPERIENCING WITH THE UPCOMING EMIR AND MIFID II LEI REQUIREMENTS? 5

6 Recent ESMA Guidance on LEIs MiFID II and EMIR Briefing Legal Entity Identifier, October 9, sma _lei_briefing_note.pdf Guidelines Transaction reporting, order record keeping and clock synchronisation, under MiFID II, updated August 7, _guidelines_mifid_ii_transaction_reporting.pdf o Scenarios 5.30 Reporting by a Trading Venue of a transaction executed through its systems under Article 26(5) of MiFIR (page 170+) Example 76 Investment Firm acting under a discretionary mandate for multiple clients (page 143+) 6

7 Gap analysis - what entities have LEIs and which ones need them. Firm Planning. Steps Taken Beyond MiFID & EMIR CFTC recent enforcement actions Level II MiFID II and EMIR Industry Readiness 7

8 Potential volume delays around MIFID/EMIR What causes delays MiFID II and EMIR LOU Readiness Capacity & turnaround time improvement How registrants can help expedite 8

9 Audience Poll # 4 WHAT CHALLENGES IS YOUR ORGANIZATION EXPERIENCING IN COMPLYING WITH NEW LEVEL II REQUIREMENTS? 9

10 Webinar GFMA Legal Entity Identifier Webinar MIFID II and Other Important LEI Matters Friday, 13 October 2017 Clare Rowley, Head of Business Operations, GLEIF 1 9

11 LEI Level II Who owns whom Starting 1 May 2017, the LEI data pool is enhanced to include information on who owns whom. This allows the identification of direct and ultimate parents of a legal entity and, vice versa, so that the entities owned by individual companies can be researched. Publication of Level 2 data commenced in May Collection and validation of Level 2 data by the LEI issuing organizations for LEIs that existed prior to May 2017 takes place with the annual renewal of the LEI. Level 2 data for the majority of the LEI population is expected to be available in the first half of GLEIF and/or its affiliates. All rights reserved GLEIF unrestricted 2 9

12 LEI Level II Level 2 data report Q ,277 legal entities reported Level 2 data. This is 11% of the total active LEIs. (As of 30 June 2017). Q3 report will be published shortly. *Reference: GLEIF LEI System Business Report 2017 GLEIF and/or its affiliates. All rights reserved GLEIF unrestricted 3 9

13 LEI Level II Interpretation of exception reporting Applicable Exception Reasons: NO_LEI 1) NATURAL_PERSONS 2) NON_CONSOLIDATING 3) NO_KNOWN_PERSON 1) LEGAL_OBSTACLES 2) CONSENT_NOT_OBTAINED 3) BINDING_LEGAL_COMMITMENTS 4) DETRIMENT_NOT_EXCLUDED 5) DISCLOSURE_DETRIMENTAL *Reference: GLEIF Business Reporting Dictionary 2017 GLEIF and/or its affiliates. All rights reserved GLEIF unrestricted 4 9

14 Ability to differentiate Branches LEI-CDF (Level 1) Element Legal Form: Branch or International Branch RR-CDF (Level 2) Relationship Type: IS_INTERNATIONAL_BRANCH_OF Branch Head Office Branch Branch Branch 2017 GLEIF and/or its affiliates. All rights reserved GLEIF unrestricted 5 9

15 BIC-LEI mapping GLEIF and SWIFT have agreed to a plan including the following deliverables for achieving the BIC-to-LEI Mapping. Deliverable 1: Agreements Cooperation agreement and SLA are ready to be signed by the end of August Deliverable 3: Establish process for BICto-LEI GLEIF and SWIFT interactions Protocol of establishing the process for BIC-to-LEI GLEIF and SWIFT interactions has been defined, deployment is planned to be in September Deliverable 2: Certification of SWIFT BICto-LEI Mapping Certification of SWIFT BIC-to-LEI Mapping is planned to be finalized by the end of August Deliverables 4 and 5: Communications and then Go-Live The expected date of publication is unchanged. GLEIF plans to golive by the beginning of Q GLEIF and/or its affiliates. All rights reserved GLEIF unrestricted 6 9

16 LEI-ISIN issuer matching GLEIF and ANNA are in the pilot phase to call on the potential way forward on technical and operational protocol work streams. Final decisions will be taken upon successful completion of this phase. Some NNAs are already LEI issuers. Consistent operational procedures of assigning the LEI will likely be efficient GLEIF and/or its affiliates. All rights reserved GLEIF unrestricted 7 9

17 ROC Fund Relationship consultation LEI ROC published a consultation document* on Funds Relationships in the Global LEI System on 26 September The objectives are as follows: Ensure consistent implementation of relationship data throughout the Global LEI System. Provide a means to facilitate a standardized collection of fund relationship information at the global level. The report proposes to replace the current optional reporting of a single fund family relationship of Level 1 with Level 2: Fund Management Entity, Umbrella Funds, Master-Feeder and Other Fund Family. Your feedback on this consultation is invited by 26 November Please send it to leiroc@bis.org. *Source: GLEIF and/or its affiliates. All rights reserved GLEIF unrestricted 8 9

18 Limitations This presentation contains confidential and proprietary information and/or trade secrets of the Global Legal Entity Identifier Foundation (GLEIF) and/or its affiliates, and is not to be published, reproduced, copied, or disclosed without the express written consent of Global Legal Entity Identifier Foundation. Global Legal Entity Identifier Foundation, the Global Legal Entity Identifier Foundation logo are service marks of Global Legal Entity Identifier Foundation GLEIF and/or its affiliates. All rights reserved GLEIF unrestricted 9 9