ROC Endorses Three Pre-LOUs

The Regulatory Oversight Committee (ROC) has endorsed three pre-Local Operating Units (LOU) from the U.S., Germany and France, as the financial industry moves toward a Global Legal Entity Identifier System (GLEIS).

In order to be endorsed by the ROC, the LOUs needed to be sponsored by an existing ROC member. The U.S. Commodity Futures Trading Commission (CFTC) sponsored the CICI Utility, which was created by DTCC and SWIFT, Germany’s Federal Financial Supervisory Authority (BaFin) sponsored WM Datenservice and the French Treasury sponsored INSEE.

The ROC found that these three pre-LOUs—CICI Utility, WM Datenservice and INSEE—meet the committee’s principles laid out on July 27, such as being ISO 17442 compliant. With the endorsement, ROC will globally recognize any certified codes issued by these pre-LOUs; some of the codes by the CICI Utility are not certified, but the CFTC says these will be phased out by the end of November.

“The ROC’s endorsement underscores the importance of industry-wide collaboration to develop the necessary principles and requirements for establishing an efficient operating framework for a GLEIS,” says William Hodash, DTCC managing director and chairman of the CICI Utility. “The progress that’s been made in establishing a standard unique global identifier and requiring it on mandatory reporting for all counterparties to derivatives transactions paves the way for other asset classes to be brought under the fold, giving global regulators and market participants alike greater insight on potential risk exposures.”