GLEIF discussed the regulatory roadmap of China to promote nationwide adoption of the Legal Entity Identifier (LEI). The regulatory roadmap is part of the "One Belt One Road" initiative and unveils the national plans to increase LEI issuance by at least 170% between the end of 2020 and the end of 2022. The Chinese regulatory authorities are proactively driving LEI usage and have set ambitious plans for substantial near-term increases in LEI volume.
In the fourth quarter of 2020, four financial regulators (PBC, CBIRC, CSRC, and the State Administration of Foreign Exchange) in China released a report detailing the LEI implementation roadmap, which looks ahead to 2022. The report outlines the general objective of the roadmap and details key LEI implementation milestones over the next two years. GLEIF understands that the general objective of the roadmap is to establish a comprehensive LEI usage policy system across the financial system in China, in line with the international standards, by the end of 2022. By the end of 2020, the roadmap provides for proposed LEI application rules in scenarios such as RMB cross-border payments, digital RMB cross-border business, qualified foreign institutional investor and RMB qualified foreign institutional investor access, derivatives trading, securities trading, and listed company supervision. Then, by the end of 2021, the roadmap mentions proposed LEI application rules in areas such as the financial market transaction reporting system, credit rating, and application of special institutional codes by overseas institutions. By the end of 2022, the total LEI volume in Mainland China is expected to reach 100,000 and China expects to use LEI in scenarios such as digital identification of cross-border legal persons and to establish a mechanism for commercially sustainable operation of LEI.
GLEIF also welcomed the news that Chinese Financial Certification Authority (CFCA) has launched the first commercial demonstration of LEIs embedded within digital certificates. CFCA has simultaneously become the first Certification Authority to assume a Validation Agent role within the Global LEI System. The combined sum of these two initiatives (roadmap and demonstration of LEIs) is significant. This shows an advanced level of proactivity from regulatory authorities, which is driving LEI issuance to support financial services and banking ecosystems, simplify international trade, and enhance digital identity across the region.
Keywords: International, Asia Pacific, China, Banking, Insurance, Securities, LEI, GLEIS, Roadmap, FCA, PBC, CBIRC, CSRC, GLEIF
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