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The Legal Entity Identifier (LEI) is a unique 20-character code that is used to identify legal entities involved in financial transactions. In Portugal, the use of LEI codes has become increasingly important for compliance with regulatory requirements, particularly in the financial sector. In this blog post, we will explore the LEI code, including its benefits and requirements.
Benefits of LEI Code
The LEI code provides a standardized way of identifying legal entities involved in financial transactions, making it easier for regulatory authorities and other stakeholders to track and monitor transactions. Moreover, the LEI code is recognized internationally, making it easier for businesses to engage in cross-border transactions and comply with global regulations.
The LEI is also beneficial for companies involved in export and import transactions, among other functions.
The use of the LEI increases confidence in counterparties to transactions and reduces risks of market abuse, financial fraud, money laundering, and terrorist financing.
Requirements for Obtaining an LEI Code
In Portugal, legal entities that engage in financial transactions are required to obtain an LEI code. This includes entities such as corporations, partnerships, and trusts. The requirements for obtaining an LEI code in Portugal include:
- Registering with an LEI issuer
- Providing accurate information.
When registering for an LEI code, legal entities are required to provide accurate information about their identity and legal status. This information is verified by the LEI issuer to ensure that the entity is eligible for an LEI code.
- Paying the required fees.
There are fees associated with obtaining an LEI code, which vary depending on the issuer and the length of the registration period.
- Maintain the LEI code.
Once obtained, legal entities must maintain their LEI code by updating their information as necessary and renewing their registration before it expires.
Conclusion
The LEI code has become an essential tool for regulatory compliance in the financial sector in Portugal. By obtaining an LEI code, legal entities can ensure that they are compliant with regulatory requirements and have a standardized way of identifying themselves in financial transactions. If you are a legal entity involved in financial transactions in Portugal, it is important to consider obtaining an LEI code to ensure compliance and facilitate cross-border transactions.