The Financial Conduct Authority (FCA) advice on its website indicates that ‘if you are a corporate entity, public body, council, charity or trust, your financial service provider will need your LEI.

‘Your financial service provider will not be able to execute transactions on your behalf from 3 January 2018 if you have not provided them with your LEI or National Insurance number.’

Michaela Johns, director at HWB and head of the not-for-profit team at the accountancy firm, said: ‘These new rules are aimed at making financial markets clearer and safer for everyone, but it’s important to act now in order to comply.

‘Every charity will need to inform their financial services provider of their LEI otherwise they will not be able to execute transactions on their behalf.’

Shares, corporate bonds, structured products, exchange traded instruments and venture capital trusts, are some, but not all, of the financial instruments subject to the regulation under MiFID II.

All trusts and charities that are parties to financial transactions will need an LEI – a unique 20-character alphanumeric code that identifies distinct legal entities. Johns says this covers charities that engage in financial transactions, including transactions in listed investments.

The unique LEI code is included in a global data system and enables every legal entity or structure that is a party to a relevant financial transaction to be identified in any jurisdiction.

LEI numbers are available from bodies endorsed by the Legal Entity Identifier Regulatory Oversight Committee (LEIROC) as an authorised local operating unit for the global allocation of LEI numbers. There is a fee for obtaining an LEI, which Johns says is generally in the region of £150.

The FCA’s MiFID II – Legal Entity Identifier (LEI) update is here.

Report by Pat Sweet