These identifiers are key global standards for promoting transparency in the financial markets, the central bank said in a release.
LEI code is a 20-character unique identity code assigned to entities that are parties to a financial transaction. This code will be applicable to all OTC transactions undertaken by entities other than individuals in the markets for Government securities, money market instruments, foreign exchange instruments and derivatives, as per the release.
For users/clients undertaking non-derivative foreign exchange transactions, the LEI code shall be applicable only for transactions involving an amount equivalent to or exceeding USD one million or equivalent thereof in other currencies, the central bank said.
Further, UTI is a unique identifier assigned to an OTC derivative transaction.
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UTI needs to be generated or reported for all transactions in the OTC derivatives market undertaken in terms of the Governing Directions, and the directions will be applicable to OTC derivative transactions entered into on or after the date the directions come into effect.
The central bank said UTI have to be generated in accordance with the UTI Technical Guidance issued by the Committee on Payments and Market Infrastructures (CPMI) – International Organisation of Securities Commissions (IOSCO) in February 2017.It shall have a maximum of 52 characters comprising the LEI of the generating entity, followed by a unique identifier and shall be unique to a derivative transaction throughout its lifecycle.
The directions on the LEI will be applicable with immediate effect, and UTI will come into effect from January 01, 2027, the central bank said.