ESMA issues a third statement on the implementation of LEI requirements for third-country issuers

The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, issues a third statement  on the implementation of Legal Entity Identifier (LEI) requirements for third-country issuers under the Securities Financing Transactions Regulation (SFTR) reporting regime. ESMA acknowledges the potential reporting implementation issue with respect to securities financing transactions (SFTs) entered into by EU investors for securities of third-country issuers. In particular, in third-country jurisdictions LEIs are not widely mandated beyond dealers of derivatives, therefore a significant number of issuers still do not have an LEI.

Neither ESMA nor national competent authorities (NCAs) possess any formal power to dis-apply a directly applicable EU legal text. Therefore, any change to the application of the EU rules would need to be implemented through EU legislation.

ESMA expects that counterparties, as well as the…