GSl Confidential/Proprietary 

GSl 

Response to 

the 

SIFMA-led 

Solicitation of Interest 

Legal Entity Identifier (LEI) 

Data Attributes 

for 

US Regulatory Reporting 

June 3, 2011 

1 I I' " l llu lll'> 
To the Commit tee: 

It is our sincere pleasure to have both been asked and to respond to your Solicitation of Interest 

on behalf of the financial institutions and others represented in your coalition of hade 

associations. We are pleased to again share our thoughts on this extremely important subject. In 

following your process we have submitted two (2) sets of questions and received two (2) sets of 

responses. We include them as an Attachment, immediately fo11owing this response. 

As background we have been sharing our approach and vision for a global financial industry 

reference data solution for nearly six years with financial institutions, financial market utilities, 

trade associations, data vendors and software companies, legislators, government bodies, 

standards organizations, auditors and corporate issuers, both here in the US and globally. The 

solution and approach we outline below is identical to the proposal we submitted to the US 

Treasury's Office ofFinancial Research- US frl!asur)''s Office ofFinancwl Research COFR) on 

the Legal Entlly JdcntJfH.:r, the CFTC- C ommodjty Futures Tradin~ Commission <CFTCl on the 

Unique Countcrparty Identifier, and the SEC - Securities and Exchange Commission <SECl on 

the Unique Identifi cation Code. 

As patt of our research and intensive preparation on this issue, we assembled a group of 

interested globa l stakeholders and engaged with them for a year prior to opening up the dialogue 

to a broader globa l audience. As pa1t of the GS I Open Forum held in January, 2011, GSl and 

Financial InterGroup invited academics, data and software vendors, financial institutions, 

financial infrash-ucture entities, regulators, trade associations, corporations, standards bodies, 

auditors and others to participate in the dialogue. Our collaboration and research informed our 

proposals to the three US regulators and now informs our response to this Solicitation oflnterest. 

Bob Carpenter, President and CEO 

GSJUS 

On behalfofGS1 Global 

www.GS I US.org 

GSl Confidential/Proprietary 21 
~able of Co tent~ 

Prerequisites ................................................................................................................................ 5 

Business Model ....................................................................................................................... 5 

Governance Model .................................................................................................................. 6 

Operating Model ..................................................................................................................... 7 

Data Model ............................................................................................................................. 7 

Technical Principles ................................................................................................................ 8 

Legal ....................................................................................................................................... 9 

Internal Governance Model and Compliance ........................................................................... 9 

Responses to SOl Se n Ill ..................................................................................................... 1 0 

Company History .................................................................................................................. 10 

Organization .......................................................................................................................... 1 0 

Account Management Structure ............................................................................................ 12 

References ............................................................................................................................. l2 

Strategic Alliances ................................................................................................................ 12 

Legal Actions ........................................................................................................................ 13 

Responses to SOl Appendix B .................................................................................................. 14 

Executive Summary .............................................................................................................. 14 

Data Standards I Model ......................................................................................................... 20 

Operating Mode1 ................................................................................................................... 25 

1. Self-Issuance of Lega11dentity Ident rs ..................................................................... 25 

Figure 1 - Global Business Entity Identifier Issuance Process ............................................ 27 

Capacity ............................................................................................................................ 28 

Figure 2- Variable Length GSI Company Prefix Within a Fixed Length Identifier ........... 29 

Non-Significance of the Company PreflX. ........................................................................... 30 

Figure 3- Common Occurring Corporate Events in the Life Cycle of a Legal Entity ......... 30 

2. Self-Registration of LEI Reference Data - Short Term ................................................. 31 

3. Self-Registration ofLEI Reference Data - Long Term .................................................. 32 

Business Model ..................................................................................................................... 38 

GSl Confidential/Proprietary 3 I 
Risk ....................................................................................................................................... 39 

Legal and Con1pliance ........................................................................................................... 40 

Governance ........................................................................................................................... 42 

Information Security ............................................................................................................. 42 

Solution Technology ............................................................................................................. 43 

Implementation Plan and Roadmap ...................................................................................... .44 

Resourcing ............................................................................................................................ 46 

GSl Confidential/Proprietary 41 1 '')I U 
Prerequisites 

Below are responses to the "prerequisites" section ofthe SOL 

Business Model 

M ust operate solution on a cost recove1y basis and have a formally documentetl governance 

stmcture with baltulCed representation f or relevtmt stakeholders 

OS1 is a glo bal not-for-profit organization, organized as a Belgium Association lnlernationale 

Sans But Lucratif(a.i.s.b.l.- an international not-for-profit organization). OS1 provides serv ices 

through its I JO counhy-specific "GS I Member Organizations" around the world, each ofwhich 

is required to operate on a not-for-profit basis. The US Member Organization, OS1 US, is 

organized as a Section 50 l(c)(6) organization. All services provided by OSI are operated on a 

cost-recovery basis. 

The highest level of governance in GSJ is the OSJ Management Board, which is composed of 

representatives ofall 25 global industJ:ies that OSJ now serves. Ifthe OS I System is selected to 

provide LEI issuance and LEI reference data registration, there will be seats for financial 

industry representatives and regulators within the governance shucture. In add ition, GSJ has 

sector-specific "project boards." We anticipate the fo rmation of a project board for financial 

services to govern OS I 's financial services-related activities, with ba lanced representation for all 

relevant stakeholder catego1ies. 

GS J has a federated governance structure through its Member Organizations around the globe. 

This allows for local involvement and, where required, local regulat01y oversight. However, 

it operates its self-registering numbering assignments from a single pool of numbers 

administered tlrrough a distributed data model thus assuring global uniqueness. 

M ust offer the legal entity identifier service to the public without f ees f or basic storage, access, 

cross-ref erencing or redistribution 

In its existing operations, GS1 recovers the costs of issuing identifiers and operating reference 

data infi:astructure through fees charged to companies that allocate and self-register identifiers. 

OS J would continue to do so for the fmancial indus tty. GS1 is prepared to offer to the public, 

fi·ee of charge, access to financial indushy LEI information. The determination of which 

information will be publicly available will be made through indush·y consensus, governed by 

OSl 's Global Standards Management Process, which will be informed by guidance fi·om 

financial services stakeholders, and in consideration of oca~ national and/or regional regulation 

and global standards development organizations. 

GSl Confidential/Proprietary s I Co I I 
Must be ltble to jimd and sustain the effort on an ongoing basis 

OS I has operated services specifically compatible with the requirements of this SOl for seven 

years, and more generally comparable services for nearly four decades. The longevity and everexpanding scope and coverage of the OS 1 System is a testimony to its ability to fund, sustain, 

and transform itself as industries mature and expand and as regulation adapts to these changes. 

Must be all appropriate size entity to manage a global utility of this size including adequate 

personnel, technology and the capacity to issue, maintain and provide access to many millions 

of LEis lmd their relltted data ltttributes. 

GS1 has provided identification services to over 1.5 million companies, including over 40 

million product identifiers and 1.5 million legal entity identifiers issued to date. OS I 's Global 

Data Synchronization Network (GDSN) today manages reference data for 6.8 million product 

identifiers, with thousands of attributes for each product. The OS 1 US GLN Registry today 

manages nearly 300,000 legal entity identifiers. These two services are explained in more detail 

in the main body of this response. 

OS 1 operates in J 50 countries, served by OS 1 's I 10 country-specific "OS 1 Member 

Organizations." The Global Data Synchronization Network today provides services to users in 

132 countries. GS J employs 2200 people around the globe. 

It should be noted that OS J, in addition to market participant identifiers (the LEI, UCI and UIC), 

has proposed an integrated set of unique identifiers to the OFR, CFTC and SEC that 

accommodates product codes for swaps and other derivatives; that allows for uniquely 

identifying divisions, h·ad ing desks and traders; that recognizes tbe impm1ance of and identifies a 

unique transaction identifier for audit trail purposes; and that provides for the unique 

identification of financial events, both life cycle events as well as corporate events. All are 

accommodated within the GSl system. We refer the reader to our proposals to the OFR, CFTC 

and SEC referenced in the covering letter. 

Governance Model 

Should be subject to supervision and regulation 

The governance structure ofGSl is open to pat1icipation by fmancial institutions, regulators, and 

other stakeholders at the national, regional, and global levels where required. GSl Standards are 

created through a voluntary industty consensus process, in which regulators may participate 

directly, and in which regulations are routinely considered by all industry participants. The 

federated nature of the governance stmcture allows for local, regional and national differences to 

be accommodated within each separately regulated environment, while adhering to a globally 

unique numbering standard. There are many examples of GSl Standards that were developed 

and are used in regulated environments, including health care, food safety, and others. 

GSl Confidential/Proprietary 61 ( 0 • l 0 1 
Operating Model 

Should ltllow LEI ref erence data to be updatellwitlt minimal turn-around time (inlntday) ami 

market participants and regulators sltoulll be able to clwllenge entries and request 

mnendments 

GS 1 's existing registries for reference data, including the Global Data Synchronization Network 

and the GSl US GLN Registry, all suppott real time updating and distribution of reference data. 

GS 1 's existing registries have defined processes for challenge and amendment of reference data. 

We anticipate establishing, through GS I 's Global Standards Management Process, specific 

procedures in the financial services context for challenge and update of reference data, tuned to 

the needs of the financial industry and its regulators. 

The process GSI envisions for self-registration (discussed in the main body of our response) 

would lead to higher quality reference data input at the somce, leading to a reduced need for 

challenge and amendment. 

Must be able to provide for LEI issuance both a self-registmtion mollel and have the 

capabilities to ltssign LEis in Cltses where legal entities don 't self-register with high data 

quality 

GS 1 's model for LEI issuance and registration of LEI reference data is based on the same selfregistration model that it already uses for issuance of legal entity identifiers, product identifiers, 

and other types of identification across 25 different industry vetticals around the world. This 

model has been used successfully for nearly four decades. 

In cases where self-registration is not possible or desired, then GS I can offer registration 

services on behalf of others, or GS 1 can work with one or more outside neutral organizations to 

provide registration services on behalf of others. 

Data Model 

Data Model Quality assum nce should include checks f or existing entities including name 

searches, address searches, and combilwtions of text strings and other clwmcteristics 

In both the case of the GLN registry and GDSN, checks ofthe kind descr·ibed in the question are 

made to ensure uniqueness of the identifiers in question. In addition, other syntax validity 

checks are applied, and addresses are norma lized using software provided by the US Posta l 

Service and other postal authorities. 

GSl Confidential/Proprietary 71 ( 
Technical Principles 

Security ltml reliability of all IT systems involved in developing, maintaining and publishing 

LEI reference data should meet or ex.ceell imlustty standards for real-time, high availability 

market service 

IT infrastructure is hosted at third party providers. The hosting environments adhere to industry 

standards and practices for security, redundancy, and service levels. More details are provided 

in later sections of this response. 

Must have experience with developing large-scale, global solution(s) elsewhere within the 

Financial Services iml11stty 

GSl Member Organizations have been actively involved with the banking industry in the areas 

of electronic payments and cash handling, and with commercial companies in the invoicing and 

payment space. GSl has partnered with Financial InterGroup, who has extensive global 

experience in designing and implementing large-scale global financial industry solutions in 

trading, clearing, risk management, data management and networking, across the broad 

dimension of capital and contract markets, both across organized exchange markets as well in the 

over-the-counter dealer markets. 

Solution provider tmtst have experience in intemational markets 

GSl operates in 150 countries, served by GS l's 110 country-specific "GS 1 Member 

Organizations." GSl 's Global Data Synchronization Network for reference data today operates 

in 132 countries, served by 28 data pools (organizations providing extended reference data sets) 

operated across the globe. 

GSl Member Organizations p rovide to each local market administration, outreach, training, 

education, and implementation support, all tailored to the language, customs, and needs of each 

locality. In addition, the GS1 Member Organizations cooperate with local government and 

regulators. 

Must be able to issue, register and maintain entity identifiers within 12 months 

GS 1 is proposing to use an existing legal entity identifier standard, the GS I Global Location 

Number (GLN). This identification system has been in use for 15 years, with over 1.5 million 

legal entity and location identifiers issued to date. GS .I is also proposing to use the existing GS I 

US GLN Registty as the basis for the near-term LEI reference data registry to meet immediate 

US requirements. This specific reference data registry has been in use for 7 years, with nearly 

300,000 legal entity identifiers registered to date. We anticipate requiring only three months to 

add additional attributes to this existillg system to meet the requirements for the 19 financial 

services attributes as detailed ill the SIFMA-led Requirements document. A more detailed 

schedule and implementation plan is described in a later section of this response. For a longer 

GSl Confidential/Proprietary 8 I 
term global solution, GS 1 is proposing a solution modeled on the GSl Global Data 

Synchronization Network, which today operates in 132 countries to provide reference data for 

6.8 million identifiers each having thousands of attributes. 

Because all elements of GSI 's proposals either make use of existing standards and systems 

without modification, or require only small enhancements to existing systems, GSl is confident 

that it will be capable of issuing, registering, and maintaining legal entity identifiers well within 

the 12 month objective. 

Legal 

Should have legal staff with appropritlte skills/background to deal with international laws, 

intellectual property rights issues 

GSl bas in-house general counsel supplemented with extemal resources in the areas of 

intellectual pro petty and intemational law. GS 1 can provide more details under NDA. 

Internal Governance Model and Compliance 

Processes should be adequately governed and tmtlitable 

All standards development in GSl is canied out through the GSl Global Standards Management 

Process. This process is a voluntary community consensus process, with well-defined process 

steps, community review points, and voting gates as detailed in GSJ 's process manual. 

Development of services offered by GS I and its Member Organizations arc carried out through a 

similar process which is geared towards setvice creation as opposed to standards development. 

Both processes are governed by the GS1 Management Board and its subcommittees. A Process 

Oversight Committee exists to audit that all processes are followed correctly, and the processes 

themselves are designed to produce outputs that allow it to be audited by external pruties if 

needed. 

GSl Confidential/Proprietary 91 
Responses to SOl Section Ill 

In this section, we respond to questions posed in Section III of the SOL 

Company History 

Include specific past experie11ces aml current performances that would directly apply to the 

goals and objectives of this SOL 

There are three components of the GS J System that exist today and which we propose to use 

directly to meet the financial industry's requirements for an LEI and LEI reference data registry. 

They are: 

• Legal Entity Identifier The GSl Global Location Number (GLN) has been in existence as a 

global standard for legal entity identification for 15 years, with over 1.5 million GLN 

identifiers issued to date. The methodology for issuing GLNs and other GS J identification 

has been the foundation of the GS 1 System since its inception in 1974, and has to date 

supported the self-issuance of over 40 mjllion globally unique identifiers by 1.5 million 

companies in 150 countries across the globe. 

• GSJ US GLN Registly This registry for legal entity reference data has been in use since 

2004, and today ho lds reference data for nearly 300,000 legal entities that are identified by 

GSJ 's GLN legal entity identifier. In this registty, each legal entity has 28 associated data 

attiibutes. 10 of these 28 atttibutes are identical those in the list of 19 attributes in Figure 1 

of the SIFMA-lcd Requirements document. We propose simply to extend the GLN Registry 

wit h approximately nine additional attributes to meet the needs of the financial industry, 

whlch we believe can be accomplished in three months. This is a proven solution that is 

ah·eady in use, operates under well-defined service level agreements, and which already has a 

complete supp01ting infrastructure for quality assurance, customer suppo1t, and the like. 

• GSJ Global Data Synchronization Network (GDSN) We propose to model the long-term 

solution on GSl 's Global Data Synchronization Network (GDSN). This approach is based on 

the industry requirements expressed to date. GDSN has been in existence since 2004 to 

register, maintain, and distribute reference data associated with globally uruque product 

identifiers, with over 6.8 million product identifiers registered to date, and tens ofthousands 

ofproduct attributes defined. GDSN has sophisticated access control mechanisms to ensme 

that reference data is distributed only to authorized parties, and a well established change 

control mechanism and process for updating the definitions of available atttibutes. GDSN 

has a federated architecture in which multiple "data pools" around the world, coordinated 

through a GS I "global registry," collaborate to provide seamless service around the globe. 

Today there are 28 data pools serv ing 132 countries. Having multiple data pools provides for 

competition (and thus choice and lowered costs to end users), and the ability to serve local 

GSl Confidential/Proprietary 10 I 
markets in a tailored fashion. More imp01tantJy, we believe that the federated model is 

essential for a solution to be accepted internationally, as we explain in the body of our 

proposal. 

Organization 

Include names and titles of all key-operating personnel. Include name and related business 

relt1ted experience of each officer, director, general partner, stockholder, or limited partners 

holding more titan 5% interest in the company. 

For GS1 US: 

• Bob Carpenter, President and CEO 

• Gay Whitney, SVP Industry Engagement 

• Katy Theroux, SVP Solutions, Customer Engagement, and Human Resources 

• Y egneswaran Kumar, SVP & CFO 

• Bernie Hogan, SVP Emerging Capabilities and Industries 

• BilJ Vo ltmer, President 1 SYNC 

For GS1 global: 

• Miguel A. Lopera, President and CEO 

• Sally Herbert, President of Standards & System Development, President ofGSl GDSN Inc. 

• Philippe Wery, Chief Financial and Administration Office1· 

• Pattick Vanlombeek, ChiefMarketing Officer 

• Malcolm Bowden, Chief Solution Officer 

Please disclose whether any of these individuals have been convicted of any crimes involving 

tlishonesty or have filed bankruptcy in the ptlst. 

None. 

GSl Confidential/Proprietary 111 0 v c.. lJ 
Account Management Structure 

Provide an organiultiomtl chart of those individuals critical to the success of this potential 

agreement within your organization beginning with your C/wimum ami/or COO. 

Please see the above list of executives, and the answer to the second question in the 

"Implementation Plan" section of the Appendix B response, and the answer to the question in the 

"Resources" section ofthe Appendix B response. 

References 

All references should include company name, address, telephone, aml contact mtme. 

Provide three 1mtjor account references that closely pm•ttllelthe requirements publishetl by the 

Tnule Associations. Include services provided aml annual billings. Provide three major 

account references that you have not retained. Include services provided, annual billings, and 

their reason for departure. 

GSl is a not-for-profit organization. GS1 is a standards development organization, and GS1 

operates services on a not-for-profit, cost recovery basis for the industries that it serves. We do 

not engage in for-profit service development or deployment. As such, it seems that the questions 

asked to not apply to om type of organization. 

If the Committee can be more specific about the type of references you seek, given the nature of 

GSl and GSl US's business, we will be happy to comply. 

Strategic Alliances 

List in your response all stmtegic ttlliances you plan to use and in what capacity, if yo11r 

company is endorsed tts one oftlze solution provider for the LEI effort. 

• Financial InterGroup GSI has partnered with Financial InterGroup for its deep financial 

industry expe1t ise. Financial InterGroup is a strategy and development fu·m advising 

fmancial enterprises and their technology suppliers on issues related to mergers and 

acquisitions, new product and market development, global strategies, restmcturings, 

information systems, communications infi·astmctures, and risk and data management. Its 

principals and advisory board members have been practitioners in and advisors to many of 

the leading service companies and many ofthe largest of financial enterp1ises globally. It has 

unparalleled expe1t ise in the relationship of data management and risk management, 

publishes extensively on these subjects in the academic literature and trade press, and its 

members have been present as advisors or practitioners at every major infrastructure event 

throughout the last six decades of financial services evolution. 

• VeriSign GSl pa1tners with VeriSign to deliver global network services. GSl 's Object 

Name Service, a global lookup service that is the foundation ofthe "Internet ofThings", is 

GSl Confidential/Proprietary 121 r • g ( (\ ' I' I I c I 2 0 J J (' • I IJ • 
operated by VeriSign. VeriSign's extensive experience in networking, security, and globalscale directory services may play an impo1tant role in the long-term globa l solution described 

herein. 

• Summa Technology Group SummaTG provides leading companies B2B Jntegration as a 

managed service. GS1 uses Summa's development, hosting, and co-location services for the 

GSl Global Data Synchronization Network. 

• Savvis Inc. Savvis is a global leader in IT infrastructure services with a platform spanning 

Notth America, Europe, and Asia. GS I US uses Savvis's hosting and co-location services 

for the GS 1 US GLN Registry. 

Legal Actions 

Provide information con ceming any p ending lmvsuits or regulatory proceedings, disciplhuuy 

actions, sanctions, license susp ensions or revocttfions, etc or any potential conflicts of interest. 

GSl US, lSYNC, GSl a.i.s.b.l. (GS J Global) and the American Hardware Manufacturer's 

Association (AHMA), are named defendants in the matter ofEdgenet Inc. v. GSJ US, Inc. et al, 

Case No. 09-CV-65 pending in the United States District Court for the Eastern Dishict of 

Wisconsin (Milwaukee Division). To date the defendants have successfully defended the action, 

as the Court recently dismissed, with prejudice, the majority of plaintiffs second amended 

complaint. The CoUJt has ordered that only claims of copyiight and misappropriation of trade 

secret survive the defendants' motion to dismiss and it also has denied plaintiffs attempt to 

pursue an interlocutory appeal. GS 1 US and I SYNC deny the allegations and will continue to 

vigorously defend against all liability and damages. 

GS 1 US is also a named defendant in the matter of Bar Code Talks Inc v. GS I US, Inc. filed in 

state comt sitting in Spokane Washington, wherein plaintiff asse1ts various breaches of contract 

and other claims against GS1 US for denying its request to amend its database to reflect a change 

in ownership of a specific UPC or company prefix. GSl US denies the allegations and will 

continue to vigorously defend against all liability and damages. 

There are no other pending lawsuits or recent judgments against GS 1 US. 

Provitle information concerning ttl/ judgments against your company in the past hllo years. 

Provide inf onmttion conceming material judgments against your compmzy in the p ast jive 

years. 

There have been no judgments against GS I US in the past five years. 

GSl Confidential/Proprietary 13( I) 
Responses to SOl Appendix B 

In this section, we respond to questions posed in Appendix B of the SOL 

Executive Summary 

Please indicate the capacity in which you are responding to this SOl, i.e., intem ational 

standards body, issuing authority, facilities uumager, or ft combination of one or more of the 

aforementioned. 

GS 1 's primary role is an identification issuing authority and as an international standards body. 

GS1 also creates and operates registration and lookup services on behalf of the indusbi es it 

serves. GSl is also prepared to suppo1t a federated solution as the roles of others are 

incorporated into an overall service tluough independent solution providers other than GSl. This 

is a model that has worked well for certain industries that have existing, entrenched solution 

providers that create value for their clients. The GS1 model is flexibly applied based upon the 

needs of each industry it works with. 

Provide fm executive stmmulry of your proposed solution, ltigltlighting aspects where you 

believe you bring in extraordinary capabilities and value that would differentiate your 

organization in a global implemenffttion. 

We believe the key differentiators of our proposal are as follows: 

• Built upon existing, proven standards and technology GS I 's proposal is based on existing 

standards and technology that have been proven in many years' usc by other industries. We 

believe GS 1 is the only organization that a keady issues lega l entity identifiers on a 

worldwide basis and operates global registries for associated reference data. Consequently, 

we believe GSl 's proposal offers the least risk and the fastest time to implementation. 

Specifically: 

• An already existing LEI GSI already issues globally unique, persistent legal entity 

identifiers, called Global Location Numbers (GLNs). These arc used today by companies 

around the world to identify legal entities in electronic purchase orders, invoices, and 

other business documents, with over 1.5 million such identifiers issued to date. There is 

no need to create new identification standards in a lengthy development process; existing 

GS I global standards can meet the needs of the financial services indushy 

• Already in use by the companies that need LEis Many of the companies that would 

require LEis under proposed financial rulemaking are the same companies that already 

use GS I GLNs as legal entity identification in electronic commerce. An estimated 30 -

50 percent of companies that require fmancial identifiers in a sample of the major trading 

market indices already use the GS1 System of standards: 

GSl Confidential/Proprietary 141 l 0 v 
33% of the S&P 500 

83% of the DAX 30 

30% ofthe FTSE 100 

53% ofthe Nikkei 225 

• An already existing system for registering and distributing reference data GSl already 

operates several systems for registering and distributing reference data. In the US, the 

GSI US GLN Registry maintains reference data for nearly 300,000 legal entity 

identifiers. Globally, the Global Data Synchronization Network (GDSN) maintains 

reference data for 6.8 million product identifiers, each with thousands of attributes, and 

delivers this tlu-ough a federated network of 28 data pools serving 132 countries. 

• International from Day 1 GS1 's legal entity identifier and systems for maintaining and 

distributing reference data are based on global standards, and are cunently used today in 

countries across the globe. GSl 's Global Standards Management Process is an intemational 

forum for creation of voluntary industry consensus standards. GSl 's 110 Member 

Organizations across the globe provide for support of internationa l users including education, 

training, customer supp01t, and patticipation in community processes, all with local expertise 

and language. 

• User-driven governance processes GS 1 's Global Standards Management Process and its 

process for developing services are designed to ensure fair, balanced participation from all 

categories of stakeholders. Minimum participation requirements for end users (in both 

number and balance) ensure that all decisions truly reflect industry consensus. GS 1 is 

governed by global and local Management Boards comprising senior stakeholders from the 

various industries served. It is suggested that the financial services industly will benefit 

tlu-ough the review and adoption of these GS I governance protocols and proven practices. 

• Globally-recognized Standards Development Process As an existing global, neutral, 

voluntary consensus standards body, GSI operates a user-driven Global Standards 

Management Process (GSMP) for the development of any new identification and reference 

data standards that may be required. Also, GS 1 is recognized by the Internationa l Standards 

Organization (ISO), collaborates with many other standards setting bodies, and can provide 

standards for financial institutions/financial intermediaries and market participants who are 

non-financia l corporations and businesses that use capital and contract markets 

• National Sovereignty and Regulation GS 1 proposes a federated model for an international 

service that provides the necessary flexibility to take into account concerns for national 

sovereignty and different national preferences for regulation and oversight. The federated 

GSl Confidential/Proprietary l SI 
model allows a country to operate in a way that is protected iiom interference by other 

countries, and allows each country's implementation to be subject to local regulation, 

different confidentiality regimes, and differing degrees of direct governmental controL 

• Neutral, no conflicts GS 1 is a neutral, not-for-profit organization operating on a costrecovery basis. It does not offer any for-profit services to the financial industry or any other 

industry. GSl 's role as the steward of a volunta1y industry consensus standards process and 

as an operator of services on behalf of the financia l indust1y is fl"ee fi:om conflicts of interest, 

and is separate and apatt iiom the competitive offerings of vendors, software companies and 

infi·astructurc providers. 

• Decozples Issuance from Registration The GS l proposal decouples the issuance of 

identification numbers fi·om the registration of reference data. This allows fo r competition to 

drive down costs, avoids disenfranchising existing organizations with experience in fmancial 

data management, and also provides for local regulations that may vary fi·om country to 

country. 

The following summarizes our proposal which was made to the OFR, the SEC, and the CFTC. 

Our intention is to satisfy the OFR's requirements for a Legal Entity Identifier (LEI), the SEC's 

requirements for a Unique Identifier Code (illC), and the CFTC's requirements for a Unique 

Counterparty Identifier (UCI). Throughout this document, we will use the term LEI, with the 

understanding that it is intended to serve as an LEI, UIC, or UCI as described by these 

government agencies. 

As stated in our submissions to the OFR, the SEC, and the CFTC, GS 1 's proposed solution has 

three components: 

• identification We propose a system of universal identification for the fmancial industty, 

which includes lega l entity identification that satisfies OFR's, SEC's and CFTC's 

requirements. The identifiers we propose are based on t he GS 1 System, which is a system 

for the globally unique identification for business that has been in existence for 40 years. 

The Legal Entity Identifier proposed here is GS I 's Globa l Location Number (GLN), which is 

already in use internationa lly by many companies who also operate in the financial sector. 

• Issuance We propose a method of issuing financial identifiers that is globally distributed, 

and directly empowers end users to issue globally unique identifiers without having to 

interact with an issuing authority each time. This is based on a two-step issuing process in 

which a user company first obtains a GSI Company Prefix which provides the user with a 

certain capacity to create financial identifiers, after which the user creates individual 

financial identifiers using the company prefix as a stem. Because the GSl Company Prefix 

issued to the end user is globally unique, all identifiers created by that end user are also 

globally unique. This is a proven methodology already well established in many sectors for 

GSl Confidential/Proprietary 16 1 I I ' I ( 
the globally unique identification of legal entities, products, supply chain logistics units, and 

other business objects. A variable-length company prefix is used, which is an i1111ovative 

method by which a wide range of capacity requirements across end user companies can be 

accommodated, while still having a sho1t, fixed overall length for identifiers that eases 

database management. 

• Reference Data We propose a method for the registration and distribution of reference data 

pet1aining to financial identifiers that decouples the process of issuing an identifier from the 

process of registering and verifying reference data. We propose a self-registration method in 

which an end user creates a standardized business document that defines the reference data 

for a given LEI (using an XBRL temp late or other standard adopted by the indushy), certifies 

the accuracy of this data with an independent auditor or other ce1tifying authority, and 

submits the cet1ified data to a reference data registry. All patts of this process are designed 

for automated, "straight through" processing, minimizing the possibility for enor. 

As regards the reference data registries themselves, a key feature of our proposal is t he 

possibility for multiple, federated registration authorities. For the purposes of registration 

and access to reference data these registration authorities act collectively as a single, 

worldwide resource. The federated structure, however, makes it possible for the system to 

scale internationally, as it can accommodate differences in local laws and regulation across 

jurisdictions, and address concerns related to national sovereignty that inevitably arise in an 

international environment. It also provides for competition and for leveraging the expe1tise 

of existing solution providers. Recognizing the urgency of a short-term solution to meet 

immediate regulato1y requirements in the US, we propose a phased approach in which GSI 's 

existing GLN registry for the US is used to meet sho1t-term needs, scaling later to a fully 

international, federated approach. 

We believe that all three of these components must be addressed in order to deliver an effective 

solution to the financial industry. Recognizing, however, that the SIFMA-Ied SOJ has chosen to 

focus attention on the third ofthese three components, the remainder of this section will describe 

in detail our proposal for registration and distribution of reference data. Please see the earlier 

referenced proposals to the OFR, CFTC and SEC fo r more information about the identification 

and issuance components of our proposed solution. 

A key differentiator of our proposed solution is that aJJ three components exist today and are 

in use at scale. The GSl Global Location Number (GLN) has been in existence as an 

international standard for lega l entity identification fo r 15 years, with over 1.5 million GLN 

identifiers issued to date. The methodo logy for issuing GLNs and other GSl identification has 

been the foundation of the GSl System since its inception in 1974, and has to date suppmted the 

self-issuance of over 40 million globally unique identifiers by 1.5 million companies in 

GSl Confidential/Proprietary 17) (l ~ I U 
150 countties across the globe. The reference data component of our proposal is based on two 

reference data registries operated by GS I today, as detailed below. 

It is well recognized that any LEI solution truly capable of addressing systemic risk must 

necessatily be an international solution, due to the highly interconnected nature of financial 

markets around the world. Therefore, it is essential that any solution be capable of scaling to a 

fully international environment. We recognize, however, that today we face a short-term 

requirement to meet the regulatory requirements of US regulators. These requirements are 

known today in much more detail than are international requirements. For this reason, GSI 

proposes a two-phase approach to providing a reference data registt·y solution to the financial 

industry: 

• Short-term We propose to use GS I US's existing GLN Registry. This registry for legal 

entity reference data has been in use since 2004, and today holds reference data for nearly 

300,000 legal entities that are identified by GS 1 's GLN legal entity identifier. In this 

registry, each legal entity has 28 associated data attributes. 10 of these 28 attributes are 

identical those in the list of 19 atttibutes in Figure 1 of the SIFMA-Ied Requirements 

document. We propose simply to extend the GLN Registry with approximately 

nine additiona l attributes to meet the needs ofthe financial industt·y, which we believe can be 

accomplished in three months. This is a proven solution that is already in use, operates under 

well-defmed service level agreements, and which already has a complete suppmiing 

in:tiastructure for quality assurance, customer supp01t, and the like. 

• Long-term We propose to model the long-term solution on GSl 's Global Data 

Synchronization Network (GDSN). This approach is based on the industry requirements 

expressed to date. GDSN has been in existence since 2004 to register, maintain, and 

distt·ibute reference data associated with globally unique product identifiers, with over 

6.8 million product identifiers registered to date, and tens of thousands of product attributes 

defmed. GDSN has sophisticated access control mechanisms to ensure that reference data is 

distributed only to authorized patties, and a well established change control mechanism and 

process for updating the definitions of available attributes. GDSN has a federated 

architecture in which multiple "data pools" around the world, coordinated through a GS I 

"global registry," collaborate to provide seamless service around the globe. Today there are 

28 data pools serving 132 counhies. Having multiple data pools provides for competition 

(and thus choice and lowered costs to end users), and the ability to serve local markets in a 

tailored fashion. More importantly, we believe that the federated model is essential for a 

solution to be accepted internationally, as we explain below. 

More information about the GS I US GLN Registry and the GS1 Global Data Synchronization 

Network may be found in the Operating Model section and other sections below. 

GSl Confidential/Proprietary 18) ) y ' I 
GSl has long experience in issuing identification and managing reference data in an international 

setting. GSl 's standards for product identification and electronic commerce are the most widely 

accepted standards of their kind in the world. All consumers are fami liar with GS1 's Global 

Trade Item Number (known as the Universal Product Code or U.P.C. in Notib America, and the 

European Article Numbering code or EAN elsewhere in the world) which appears on the labels 

of consumer products in 150 counh; es around the world. Less visible to consumers, but equally 

in1portant, are GS I 's identifiers for legal entity identification (the GLN) which are an integral 

part of elech·onic commerce messaging between trading pattners around the world. 

As a consequence of this expet; ence, GS 1 recognizes that a globally-acceptable solution for 

registration and distribution of reference data must be a federated model. By a "federated 

mod ~" we mean a system that provides seamless access to all reference data regardless of otigin 

or point of access, but where the data is held in a collection of repositories that interact to 

provide this seamless access rather than as a single repository. There are several reasons why a 

federated model is essential to operating in an international environment: 

• Having a single, centra lized worldwide database is unlikely to scale adequately to meet 

worldwide demand, especially as more stringent real-time requirements for access and 

updating evolve 

• A single registrar would have no conesponding global regulator and would thus be a highly 

vulnerable "weak link" in the worldwide financial system as the oversight of that single 

organization would not be possible under current g lobal regulatory regimes 

• In an international setting, it is highly unlikely that any country would accept a system where 

information critical to the oversight of that country's financial markets is held by some 

registration organization located outside of that country. Many, if not alJ, countries will see 

this as an issue of national sovereignty, and want to have regisn·ation for their own financial 

entities handled by a registrar that is located in their country or its regional extension, subject 

to that sovereign entity's own laws and regulations, and able to function regardless of the 

state of foreign relations with other countries. 

• Maintaining financial reference data is a highly complex task requiring considerable skill and 

expertise. Moreover, there are many value-added services that can be provided around the 

maintenance of and access to reference data. It is highly desirable in this space to foster 

continuous innovation, to improve cost effectiveness, and to a1Jow for competition while not 

disenfranchjsing existing service providers who provide value added services to the financial 

industry (i.e. market and reference data vendors, fmancial market utilities, h·ading venues, et 

al) . 

• It is desirable to leverage the capabilities of the many existing companies and organizations 

that have expeti ise in maintaining a myriad of financial reference data (i.e. tax-identification 

GSl Confidential/Proprietary 191 
numbers, tax exemption certificates, delivery addresses, credit ratings, transfer agent 

registries, et al). 

Data Standards I Model 

Describe the dattt standards you would develop to support this effort. Include details around 

your data model including attributes, metadata, etc.? How will you emmre that this is 

extensible in the future? 

We believe the following standards are needed: 

• A data standard that defines the stmcture and allocation of the LEI itself. 

• A data standard or collection of standards that defines the structure and meaning of reference 

data associated with each LEI. Initially, this would be a single standard that defines a core 

set of attributes similar to those defined in Figure 1 of the SIFMA-led Requirements 

document. Over time, we expect this will grow to encompass additional data as the industry 

identifies additional requirements, and may grow to a modular set of standards that reflect 

different types of data that need to be associated with the LEis for different types of legal 

entities, and different operational purposes. 

• A data standard for the submission of LEI reference data by a registrant to a registrar dming 

the process of self-registration. This data standard should be designed to be auditable, so that 

a registrant can work with an independent auditor or other designated certifying agent to 

certify the accuracy of the data prior to its registration and entry into the LEI reference data 

repository. 

• A data and interface standard for the query of data fi·om the registry by users and 

applications. 

• Data and interface standards to support the inter-registry communication needed to supp01t 

the federated model. 

We propose that these standards be developed as fo llows: 

• A data standard that defines the structm·e and allocation of the LEI Use If GS 1 is proposing 

using the existing GSl Standard for the Global Location Number (GLN). This is a widely 

adopted international standard for legal entity identification, used today to identify legal 

entities in electronic purchase orders, invoices, and other busiJ1ess transaction documents. 

Over 1.5 million GLNs have been issued to date around the world. 

• Data standards that further define the reference data associated with an LEI To the extent 

that the LEI minimum data attributes for regulatory reporting and aggregation purposes, as 

described by the OFR and further evolved in the SIFMA-led Requirements document, is 

GSl Confidential/Proprietary 20 I 
found sufficient and complete then it will become the reference data associated with the LEI. 

To the extent that other data attributes arc found to be needed we propose developing such 

standards through a global voluntary industry consensus process. GS J 's Global Standards 

Management Process (GSMP) is available to develop such standards. Moreover, there are 

standards organizations that are ah·eady widely accepted in the financial industry (e.g. for 

bank and bank branch codes; communication messaging; asset identification, et al). GS I 

would seek to leverage those standards rather than developing new standards. Our proposals 

to the OFR, SEC and CFTC recognize legacy and best practice standards and accommodate 

them in a practical way, either for perpetual usc or as temporary best practice identifiers that 

will be replaced over time as legacy systems are decommissioned. 

• A data standard for submission ofLEI reference data during self registration As XBRL is a 

widely-accepted suite of standards for the submission of financia l data, we believe XBRL is 

a ve1y appropriate choice for this purpose. However, GSl would determine such submission 

standards through a global voluntary industry consensus process. Here, GSl 's Global 

Standards Management Process (GSMP) is available to develop and/or adopt such standards, 

if the indust1y chooses. To the extent that other standards organizations are already widely 

accepted or other input mechanisms are available fro m within the financial industry, we 

would seek to leverage those standards and systems rather than developing new ones. 

• Data and inleJface standards for interacting with reference data registries, and for interregisfly communication in the federated model GSI is proposing to develop and/or adopt 

such standards through a global voluntary industry consensus process. Here, too, GS 1 's 

Global Standards Management Process (GSMP) is available to develop such standards, if the 

industry chooses. To the extent that other standards organizations are already widely 

accepted or other input mechanisms are available fi·om within the financial industry, we 

would seek to leverage those standards and systems rather than developing something new. 

GSI standards are designed for extensibility. There are well-defined mechanisms for versioning 

of data and accommodating extensions within each data structure. The Global Standards 

Management Process provides a well-defined process by which users can request enhancements 

to existing standards, which then leads to revision ofthe standards through the voluntary industry 

consensus process. 

In the context of GS I 's Global Data Synclu·onization Network, there is a well-defined process 

for the roll out of enhancements to standards for reference data, such that all pa1ticipating data 

pools can implement enhancements in a coordinated way that is predictable to end users. 

GSl Confidential/Proprietary 211 ) ( ( 
Describe your capabilities around hierarchy maintenance including processing of changes. 

Woultl your model be able to accommodate ami maintain seveml layers of ltiemrchy 

information? 

Yes. Existing GS 1 Standards for product reference data already incorporate several notions of 

hierarchy. The Global Data Synchronization Network's data models for product reference data 

include hierarchy of packaging levels (the relationship between item-level, case-level, and palletlevel product identifiers, fo r example), and hierarchy of product categorization. The GS I US 

GLN Registry for legal entity identifiers includes a "parent" attribute which supports an 

unlimited number of layers of ownership hierarchy. 

Explain how the proposed data standtmls will ttdllere to the principles tletailed in the business 

requirements document. Besides the aforementioned principles, what other principles would 

you recommend when developing the data stamlards? 

GS 1 's legal entity identifier, the GLN, meets the requirements detailed in Section 6.1 of the 

SIFMA-led Requirements document as follows: 

• Persistent GS I identifiers are governed by an "allocation Jules" standard, which specifies 

the conditions under which a legal entity requires a distinct legal entity identifier, and how 

identification docs or does not change when various events occur in t11e life of the identified 

entity. We anticipate that through the GS J Global Standards Management Process the 

existing GLN allocation rules will be modified as necessary to meet the requirements of the 

financial indushy. 

In pa1ticular, "persistent" is defmed in the SlFMA-led Requirements document as meaning 

"The LEI should fo llow a legal entity through its life regardless of corporate actions or other 

business or structural changes." We would expect this principle to be reflected directly in the 

GLN allocation ru les. The rules themselves would be more detailed, and enumerate specific 

types of corporate actions and the resulting effect on the legal entity identifiers. For 

example, while we agree in principle that an LEI should follow a legal entity through its life 

regardless of corporate action, there are certain corporate actions in which this principle is in 

conflict to other principles identified in the SIFMA-led Requirements document. For 

example, in the case of two companies, each identified with a legal entity identifier, that 

merge to form a single legal entity, it is not possible for both to have each of the original 

legal entity identifiers persist in naming the new entity, and follow the "singular" principle 

("There must be only one LEI per lega l entity''). In cases like this, the allocation mles wou ld 

specify which of the two original legal entity identifiers would persist as the identifier for t he 

merged entity, or whether a third legal entity identifier must be created for the merged entity. 

The relationship between these identifiers would be expressed through reference data; e.g., in 

the latter scenario the reference data for the new LEI would name the two old LEis as 

"predecessor" LEis. This would also be covered in the allocation mles. The merger example 

GSl Confidential/Proprietary 22 1 
above is just one example of a number of scenarios that we would expect to be addressed in 

allocation rules. The GS1 Global Standards Management Process provides for the 

consensus-based maintenance and enhancement ofthe allocation rules over time by industry 

stakeholders. 

• Neutral The SlFMA-led Requirements document defines "neutral" as meaning that the 

identifier has no embedded intelligence. In the GSJ System, this is referred to as the 

principle of"non-significance" and is a core principle underlying the construction and use of 

all GS 1 identification including the legal entity identifier. 

• Singular As with the "persistent" principle above, we agree with this principle and would 

put it into effect through the constl1Jction of allocation rules for the lega l entity identifier. 

Please see the description and examples above for the "persistent" principle. 

• Unique This is a fundamental principle of GS 1 identification, and is reflected in the 

allocation rules fo r the GLN. As described elsewhere in this response, GS1 employs a 

distributed allocation methodology that ensures global uniqueness. Checks for uniqueness 

are also performed when identifiers are registered with their reference data. 

• Extensible (Scalable) The GSI legal entity identifier (GLN) has a theoretical maximum 

capacity of one trillion unique legal entity identifiers, of which approximately 11 0 billion are 

currently reserved for issuance in the US, and another 445 billion reserved for issuance in 

other countries. (The remaining 465 billion are held in reserve and not yet allocated to any 

country.) Of the 110 bilJion capacity currently reserved for the US, approximately 27 bilJion 

have already been allocated to US-based companies (this is the collective capacity allocated 

to those companies; the actual number of identifiers issued so far by those companies is 

several orders of magnitude smaller). In contrast, the document authored by Bottega and 

Powell ("Creating a Linchpin for Financial Data: The Need for a Legal Entity Identifier") 

estimated that the number of legal entities requiring identification at between 500,000 and 

2 million, or 0.002% of the current capacity. 

• Structurally Fixed The GSl legal entity identifier (GLN) is and has always been 13 digits in 

length, constructed as described elsewhere in this response. 

• Reliable (Quality) See responses to other questions that deal with reference data quality. 

The legal entity identifier itself includes a check digit, which helps to avoid keying errors 

when identifiers are subject to manual data ently. 

• Interoperable The GSl legal entity identifier (GLN) is widely used as a legal entity 

identifier in many widely deployed standards for electronic commerce. GS 1 numbeting 

systems are recognized by ISO standards, and are designed for automatic identification and 

GSl Confidential/Proprietary 231 I l C. c; I l 
data capture in an unambiguous way. The GLN is a 13-digit number that may be processed 

by any computing system whatsoever. 

How will you ensure that the developed data st(mdanls are globally accepted and comply with 

loC£tl regulations? 

GS l's Global Standards Management Process is designed to engage patticipants from across the 

globe, and thereby ensure global acceptance. Compliance with local regulation is addressed by 

individual patticipants in standards development working groups, including regulators 

themselves. 

Describe the likely scenarios and processes to refine, and/or update the proposed data 

standm·ds? 

GS 1 has a formal process for creation and enhancement of standards, called the Global Standards 

Management Process (GSMP). This process has four steps: 

1. Statement ofBusiness Need: industry stakeholders formally document the business need that 

is to be addressed by a change to standards. 

2. Requirements Analysis: industry stakeholders jointly defme the business and technical 

requirements that the change to standards must meet. 

3. Solution Development: industry stakeholders draft the changes to existing standards and/or 

create new standards documents. 

4. Deployment: the new or changed standards arc ratified by the GS J Management Board 

fo llowing an evaluation that due process was followed in all the preceding steps, the new or 

changed standard is published, and collateral materials to assist in implementation are created 

and disseminated. 

All stages are open for patticipation by all stakeholders. Each stage includes a step of 

community review, and a community ballot to proceed to the next step. 

The above process is tuned to the size and nature of the changes. For small maintenance 

changes, such as additions to code lists or minor enhancements, requirements are gathered in a 

very lightweight form and processed through the later steps as a batch, resulting in a period 

maintenance release of the standard. For larger or more complex changes, a separate work effott 

is initiated resulting in a new version of the standard addressing the change at the end of the 

process. 

A controlled roll-out process is used to deploy changes to standards to the operating data 

registries. 

GSl Confidential/Proprietary 24 1 
Operating Model 

Describe in detail your proposed operating model including but not limited to registration, 

mainteiUmce, verification, distribution, access, etc. 

Though the SOJ focuses on regish·ation of LEI reference data, GS I considers the issuance oft he 

LEI itself to be an integral patt of its operating mode l and is, therefore, included in the 

discussion below. 

The operating model is described in three parts: 

• The operating model for self-issuance of Legal Entity Identifiers by fmancial industry 

participant companies 

• The operating model for self-registration of reference data associated with Lega l Eutity 

Identifiers by financial patt icipant companies, in the short-term solution 

• The operating model for self-registration of reference data associated with Legal Entity 

Identifiers by financial pa1ticipant companies, in the long-term solution 

The description of the operating models below is taken directly fi·om GSI 's submissions to the 

OFR, SEC, and CFTC. 

1. Self-Issuance of Legal Identity Identifiers 

This section outlines the envisioned process for issuing Legal Entity Identifiers under the GS I 

proposal. 

A distinguishing feature of the GSl System is that globa lly unique identifiers are issued in a twostep process, which empowers an end user company to issue indi vidual identifiers for itself with 

no intermediary involved. This is in contrast to the issuance process used in the financial 

services industry today. The issuance process in the GS 1 System works as follows: 

• A user company that anticipates a need to issue LEis (or any other type of GSI identifier) 

fu·st obtains a GSl Company Prefix from a loca l GSl Member Organization. The GSI 

Company Prefix is a string of six to eleven digits that may be used in the next step to issue 

individual identifiers. A user company chooses the length of the GS1 Company Prefix it 

requests based on its anticipated capacity requirements, as described below. 

• Once a user company has obtained a GSl Company Prefix, it may issue individual LEis by 

assigning the remaining digits according to the structure defined for the LEI in the relevant 

GS1 Standard (in this case, the Global Location Number standard, which specifies a 13-digit 

number overall, comprised of the GS l Company Prefix, the remaining digits assigned by the 

end user company, and a check digit calculated as a function of the other twelve). A user 

company may repeat this step as many times as needed for each LEI that it needs to create. 

GSl Confidential/Proprietary 251 
In the context of financial services, we also anticipate that each time a company issues a unique 

LEI it will be required to register that LEI and its associated reference data into an LEI registry. 

Registration of identifiers and reference data is discussed in a later section. 

Figure 1 illustrates the issuance process. 

This structure for issuing LEis provides many benefits: 

• It reduces the degree of interaction between an end user and the issuing authority (namely, 

GSI). A single GSl Company Prefix provides the end user the capacity to issue many LEis 

without further interaction with GSI. This reduces costs for end users. 

• Once a user holds a GSI Company Prefix, the act of issuing new LETs or other identifiers can 

be carried out by the end user without further interaction with GS 1. This reduces the time 

required for an end user to create a new identifier. 

GSl Confidential/Proprietary 261 , I 11 
Figure 1 - Global Business Entity Identifier Issuance Process 

Step 1: User Company Obtains GS1 Company Prefix (GCP) 

GS1 

Request new GCP 

User Company 

Member 

Organization 1---------~ 

GCP = 0614141 

Step 2: User Company Issues new LEI 

User Company 

New Entity#= 12345 

0614141 12345 2 ]>-------•• NewLE/=0614141123452 

I ~4 

Step 3: User Company Registers new LEI with reference data 

GS1 US 

GLN Registry 

(shorllerm) 

______ ..,. Long-term Solution 

based on GS1 Global 

Data Synchronization 

Network (GDSN) 

The highly decentralized nature of this process helps to ensure that GS I and local regulators do 

not become bottlenecks for the financial industty. This is further aided by the fact that GSl 

Company Preftx.es are themselves allocated in a distributed fashion, across I .I 0 GS I Member 

Organizations worldwide. At the same time, the assignment of GSl Company Prefixes is 

coordinated to ensure global uniqueness of a II numbers. 

The variable length of the GS 1 Company Prefix allows the available numbering capacity to be 

used very efficiently, despite wide variation in the individual capacity requirements of individual 

GS1 Confidential/Proprietary 27( 
user companies. At the same time, the overall fixed length of the LEI simplifies its use in 

databases and other information systems. 

In some instances, a user company has only a very limited need to issue identifiers: for example, 

a small company with a simple organization that does not issue any securities but may for 

example, be a swap participant that may only require a single LEI. In such a case, the user 

company may request a single individual LEI fi·om its local GS1 Member Organization, rather 

than requesting a GS 1 Company Prefix. The GS I Member Organization in this case issues a 

complete I 3-digit LEI fi·om a reserve of ava ilable numbers maintained by the GS 1 Member 

Organization for this purpose (essentially, the GSl Member Organization a11ocates a GSI 

Company Prefix to itself, fi·om which it issues individual identifiers). Once issued, an 

individually-issued LEI functions exactly the same as any other LEI, and is globally unique with 

respect to a11 LEis regard less of how issued. The user company would register its individua 1 LEI 

in the same mam1er as it would a LEI created via the two-step process. 

Capacity 

In the GS I System, each company obtains a GS 1 Company Prefix (GCP), which effectively 

gives that company control over a pottion of the overall numbering space fiom which the 

company can issue its own identifiers. This leads to questions concerning the capacity for 

numbering required by different user organizations. 

• It is anticipated that there will be some user organizations, typically very large or very 

complex corporations that will need to issue many LEis. 

• At the other end of the spectrum, there will be many organizations that only need to issue a 

small number of LEis, including very small entities that may only need a single LEI. 

The GSl System accommodates these varying user requirements through its use of a variable 

length company prefix (see Figure 2). W11ile the overall length of an GBEl is always 13 digits 

(of which 12 digits are assigned, the 13111 being calculated algmithmically 1iom the other 12), the 

number of those 13 digits that are the company prefix varies, with the number of digits available 

for assignment by the user holding the company prefix varies in an inverse fashion. 

• For example, a large conglomerated enterprise requiring a very large capacity to create LEis 

might request fi·om GSl a 7-digit GSl Company Prefix. A 7-digit company prefix leaves 

five digits ava ilable for the creation of LEis by the user - thereby giving that user the 

capacity to issue up to J 00,000 distinct, globally unique LEis. 

• At the other end of the spectrum, a small business that only anticipates issuing a handful of 

LEis might request an 11-digit GS 1 Company Prefix, leaving one digit for assignment by the 

user. This small business therefore would have capacity to issue up to I 0 LEis using that 

GSl Confidential/Proprietary 28 1 y I U 
company prefiX. As noted earlier, an even smaller organization might request a single LEI, 

without ever obtaining a company prefix. 

Figure 2 -Variable Length GS1 Company Prefix Within a Fixed Length Identifier 

r:::.. ::; GS1 

GS1 Company ~ Member 

Prefix Database Organization 

'- - Individual LEI I I = 0181234567894 

GCP = 0614141 

GCP = 08699999999 

Large User Company Small User Company Tiny User 

' Company 

I 7-digit GCP I 111-digit GCP I I One LEI I 

5-digit Entity # 1 -digit Entity # 

(capacity for 100.000 (capacity for 10 

different LEis) different LEis) 

~ 

0614141 12345 2 08699999999 1 3 

I ~£ I ~£ ...... 

l 

..I ...... 

r 

..I 

LEI= 0614141123452 LEI = 0869999999913 LEI= 0181234567894 

Mat'ket patticipants are encouraged to obtain an appropriate length company prefix according to 

their capacity requirements, to avoid "wasted" identifier space through capacity allocated to a 

user but not used to issue identifiers. On the other hand, it is not necessary for a company to be 

clairvoyant with regard to its future capacity needs. If a company exhausts the capacity provided 

by the company prefix it obtained, it simply goes back to GS 1 to ask for the allocation of another 

GSl Company Prefix, giving it fresh capacity to create new identifiers. 

• For example, XYZ Corporation requests an 11-digit GSl Company Prefix, giving it the 

capacity to issue 10 distinct LEis. IfXYZ later discovers that it needs to issue an eleventh 

LEI it simply goes back to its GSl Member Organization and requests a second company 

prefix. It can then issue more LEis using that company prefix. If XYZ has discovered that 

its capacity requirements have increased dramatically, it may ask that the second company 

prefix be shorter, providing greater capacity for new identifiers. 

GSl Confidential/Proprietary 291 , .J [ y IIIG lLJ\ 
Non-Significance of the Company Prefix 

It is imp01tant to note that the GSl Company Prefix is intended to facilitate the allocation of 

identifiers only. It is not intended to be parsed from the LEI or other identifier, and does not 

serve to identify the company that holds the LEI. Ownership and other attributes of each LEI are 

recorded separately as reference data. In the GS 1 System. the lack of any meaning associated 

with the GS 1 Company Prefix, or indeed to any patt of an identifier, is called the "principle of 

non-significance." The reason for non-significance can be appreciated by considering how 

identifiers persist across various corporate events as seen here in some typical scenarios in Figure 

3: 

Figure 3 - Common Occurring Corporate Events in the Life Cycle of a Legal Entity 

A Large Company with Multiple Legal Entities 

XYZ Corp and ABC Co are large companies. XYZ has obtained the 7-digit GS1 

Company Prefix 5555555, and ABC bas the Company Preftx 6666666. XYZ bas 

created many LEis beginning with its prefix, e.g., the GBEJ 5555555012343; ABC 

has done likewise, e.g., the GBEl 6666666543219. On some date, XYZ Corp 

acquires ABC Co, and all of the ABC legal entities become subsidiaries ofXYZ. It is 

not desirable to assign all of the former ABC entities new LEis, as that would 

invalidate aU of the historical fmancial records pe1taining to it. Instead, the ABC 

entities continue to operate using their existing LEis beginning with 6666666. To 

reflect the change in ownership, the registered reference data for the ABC LEis are 

updated to indicate they are now subsidiaries ofXYZ, but the LEis themselves do not 

change. XYZ Corp now has two company prefixes, 5555555 and 6666666, and 

identifiers beginning with those two prefixes are now tied together tlU'ougb the 

reference data which is updated to so indicate their relationship. Any unused 

numbering capacity under ABC's 6666666 preftx is one of the assets that XYZ bas 

acquired, and going fo tward XYZ may use either prefix to create new LEis. 

A Small Company Establishes A Single New Affiliated Company 

Jtty-Bitty Corp ts a very small company that obtained an individual LEI 

1234567890 128. Several years aftetwards, Itty-Bitty creates a who!Jy-owned 

subsidia ry. The subsidiary obtains a second individual LEI 1357902468018. There is 

nothing in the LEI numbers themselves to indicate the ownership relationship; 

instead, this relationship is registered in the reference data. 

GSl Confidential/Proprietary 30 I 
The previous examples make clear that any attempt to embed intelligence in an identifier, 

especially in an attempt to capture parent-child or other ownership relationshjps between 

identifiers, is thwarted by the fact that those relationships change over time. It is for this reason 

that GS I identifiers are to be considered as opaque numbers ("non-significant", or "neutral" to 

use the term fi·om the SIFMA-led Requirements document), and any information about what 

identifiers mean or their relationship in a hierarchy of ownership is to be obtained through 

consulting the appropriate reference data associated with each identifier. 

2. Self-Registration of LEI Reference Data - Short Term 

To meet the short-term needs ofUS regulators and their constituents, GSJ is proposing to use the 

existing GSl US GLN Registry, wruch today has nearly 300,000 legal entity identifiers and their 

reference data registered. 

A key feature of our proposal is that we propose the creation of a data standard that defines a 

machine-readable document for the submission of reference data (e.g., an XBRL template), and 

that we anticipate the involvement of auditors or another suitable certification agent in the 

reference data self-registration process. These will greatly contribute to high data quality. 

In more detail, the process for the initial issuance and registration of an LEI works as fo11ows: 

• A company self-issues its own LEI using a previously obtained GSJ Company Prefix, as 

outlined in the previous section ofthe response to this question. At this stage, however, the 

LEI may not be used in financial transactions. 

• A company creates reference data for its LEI, in the form of an electronic document 

conforming to a data standard to be established (e.g., XBRL template). 

• A company works with an independent auditor to obtain an auditor's certification for the 

reference data. The auditor applies suitable criteria as agreed by the industty. 

• The company submits its reference data in electronic form, together with the auditor's 

certification, to the GSJ US GLN Registry. 

• The GS 1 US GLN Registry confirms that an auditor's ccttification is present, and performs 

additiona l quality checks on the completeness of the data, avoidance of duplicate data, 

validity ofthe LEI, etc. Note, however, that checks requiring a detailed understanding ofthe 

financial and legal situation of the registrant have been perf01med by the auditor, relieving 

GS I from having to perform this task. 

Registration of LEis is subject to annual renewal. As part of the renewal process, a company 

must once again submit an auditor's cettification as to the accuracy of its LEI reference data. In 

addition, regulators may require cettification at other times; e.g., when a corporate action 

changes the ownership structure of an LEI. Here we refer you to our proposals to the OFR, 

GSl Confidential/Proprietary 311 
CFTC and SEC wherein we discuss the Global Financial Event Identifier (GFEI) and the 

mechanism by which such information is made part of the self-registration process. In this way, 

ongoing data quality can be maintained. 

3. Self-Registration of LEI Reference Data - Long Term 

To meet the long-term needs of global financial markets and their regulators, GS I is proposing to 

use an approach modeled on the existing GSl Global Data Synchronization Network (GDSN). 

This is a federated model which today is realized by 28 data pools serving 132 countries, 

coordinating with each other via the GS I GDSN Global Registry (not to be confused with the 

GS1 US GLN Registty that forms the basis of om proposed shoti-term solution). 

Conceptually, the registry for LEI reference data is a single repository: all LEis are registered in 

the reposito1y, and so reference data fo r alJ LEis worldwide is available from a single source. 

However, we do not believe it is practical for the registry to literally be a single database. 

Today's distributed teclmology allows for a federation of local databases, each serving different 

regional markets. Moreover, we do not believe it is desirable, nor likely to be acceptable in an 

intemational setting, to have such databases (whether physically distributed or not) under the 

control of a single registrar. 

There are many reasons why we believe a single registrar, even one that operates distributed 

databases, is inadequate to meet the desire for a worldwide identification system: 

• Having a single, centralized worldwide database is unlikely to scale adequately to meet 

worldwide demand, especially as rea l-time requirements for access and updating evolve 

• A single registrar would have no corresponding global regulator and would thus be a highly 

vulnerable "weak link" in the worldwide financial system as the oversight of that single 

organization would not be possible under cunent global regulatory regimes 

• In an intcmational setting, it is highly unlikely that any countly would accept a system where 

information critical to the oversight of that country's financial markets is held by some 

registrar located outside of that country. Many, if not all, countries will see this as an issue 

of national sovereignty, and want to have registration for their own financial entities handled 

by a registrar that is located in tl1eir country and/or region, subject to that sovereign entity's 

own laws and regulations, and able to function regardless of the state of foreign relations 

with other countries. 

• Maintaining financial reference data is a highly complex task requiring considerable skill and 

expertise. Moreover, there are many value-added services that can be provided around the 

maintenance of and access to reference data. It is highly desirable to allow for competition in 

this space, to foster continuous innovation and improving cost effectiveness. 

GSl Confidential/Proprietary 321 II 
• It is desirable to leverage the capabilities of the many existing companies and organizations 

that have expe1tise in maintaining financial reference data. 

For these reasons, for the long term we propose a federated model for registration of financial 

reference data, in which there is one governance structure but many registrars worldwide. This 

is modeled after the GS1 Global Data Synchronization Network, and operates on the following 

principles: 

• Reference data for LEis worldwide is to be maintained under a federated model of registrars 

but under a single governance model 

• Any identifier may be initially registered with any registrar (possibly subject to local 

regulation, as described below). The reference data is provided by the user organization to 

the chosen registrar in the same manner as described above for the short-te1m solution. 

• All registrars synchronize with each other, so that data registered with one registrar is made 

available to all the other registrars. 

• Therefore, another user who wishes to obtain reference data (and is authorized to do so), may 

go to any registrar, and the data will be available regardless of whether that data was 

originally registered with a different registrar. 

• Any given regish·ar may be subject to local laws and regulation, and a user organization's 

choice of registrar may also be constrained by local laws and regulation. 

• Global standards for financial reference data registrars are established through a voluntary 

consensus standards process, such as the GSl Global Standards Management Process. These 

standards would address the following: 

• Minimum data requirements for reference data that must be recorded for each new 

identifier. 

• Interfaces by which users or vendors supply reference data for new identifiers and update 

existing reference data. 

• Interfaces for querying for reference data. 

• Protocols for synchronization of reference data between registration authorities. 

• Procedures for challenging reference data and requesting updates. 

Local laws and regulations may impose additional constraints for a rcgish·ar operating in a 

given jurisdiction, beyond what the global standards require. Local laws and regulations 

GSl Confidential/Proprietary 33 , , ~ r. ( ' 0 p y ~ '! l I J , I 
would specify how a registrar is certified to be in compliance with the global standards and 

accredited to act as a registrar within that jurisdiction. 

• Subject to local laws and regulation, a user wishing to register reference data for an 

identifier, maintain previously registered reference data, or query to obtain reference data, 

chooses which registrar to use from amongst the registration authorities operating within the 

user's jurisdiction. 

• GSJ maintains a top-level directory, the GSl Global Registry, that lists all registered 

identifiers, a minimal set of commonly-used reference data attributes associated with each 

registered identifier (i.e. the SLFMA-led requirements defined for the 19 data attributes 

associated with the LEI), and indicates which registrar was chosen by the user for the 

registration of each identifier. Entries in this top-level directory are maintained through 

collaboration between GS I and the registrars. 

This model provides for seamJess access to reference data which appears to end users as a 

single, worldwide database, but provides for scalability, competition, and flexibility for local 

laws and regulations. Local laws and regulations may address the foUowing: 

• Constraints on the governance and/or corporate organization of a registrar; e.g., that it be notfor-profit, etc. 

• Government audit procedures to which registrars are subject 

• Local data or additional quality assurance procedures above and beyond what is specified in 

the global standards 

• The number of registrars that are permitted to operate in a given jurisdiction. For example, a 

given country or regional jurisdiction could decide to: 

• Provide only one, state-operated registrar for the entire country or region 

• Authorize a single, independent not-for-profit organization to act as registrar for the 

country or region 

• Allow for multiple registrars to operate within the jurisdiction, potentially allowing for 

competition on service fees and value-added services. 

It is impo1tant to note that while under this proposal there are potentially many registrars for 

financial reference data worldwide, this is not the same as the current situation of many 

independent identification systems across the globe. The difference is that in this proposal, aU 

financial identifiers are allocated fi·om the same universal space of financial identifiers, and so a 

given legal entity or pa1ticipant or counterpa1ty only has one identifier that is the same in eve1y 

registrar that has a copy of its reference data. The reference data is also the same regardless of 

GSl Confidential/Proprietary 34 I 1 • 1 r 
which registrar is used to quety for that data. Figure 4 illustrates how reference data is registered 

and synchronized in a federated system: 

Figure 4 - Federated Reference Data Registrar Network 

1. Load new 

LEI 123 and 

CompanyNendor 

2. Register LEI 

123 with pointer 

registrar #1 

Reference Data 

Registrar #1 

Global Registry 

{GS1) 

5. Request 

reference 

data for LEI 

123 

6. Reference 

data for LEI 

123 

Reference Data 

Registrar #2 

3. 

reference 

data for 

123 

7. Reference 

for LEI 

This federated structure has been successfully deployed by GSl and its members in other sectors 

of the global economy. In the consumer goods sector, the GSl Global Data Synchronization 

Network (GDSN) provides reference data about consumer products to aU supply chain 

patticipants who need such data. (Reference data about a consumer product includes such things 

as: product name, product description, manufacturer, target market, dimensions, weight, 

nutrition information for food products, dosage information for pharmaceutical products, etc.) 

The GDSN is a federated network of "data pools" (corresponding to "registrars" in the above 

description), and each product manufacturer chooses a data pool with whom to register its 

product reference data. The data pools synchronize using protocols established by GS 1 

standards, and so reference data about any product is available from any data pool, regardless of 

which data pool was used to register the data in the fu·st place. GS I maintains a database ca lled 

the "Global Registry" which maps each product identifier to the home data pool for that product. 

GSl Confidential/Proprietary 35) 1 • 
GDSN today has 28 data pools operating in 132 countries, and collectively they hold reference 

data for 6.8 million product identifiers, each having thousands of attlibutes. In an analogous way 

financial intermediaries who provide reference data today will each be certified as a Reference 

Data Registration Authority (conesponding to the GDSN concept of a "data pool") and 

synchronize through the GS1 Regist1y. 

What processes will you implement to ensure high quality of data both at the onset and 

subsequently at steady state? What checks and balances do you intend to employ to ensure 

that these quality asstmmce processes are adequately robust? 

A key feature of our proposal is that we propose the creation of a data standard that defines a 

machine-readable document for the submission of reference data (e.g., an XBRL template), and 

that we anticipate the involvement of auditors in the reference data self-registration process. 

These will greatly contribute to high data quality. 

In more detaiJ, the process for the initial issuance and registration of an LEI works as follows: 

• A company self-issues its own LEI using a previously obtained GS1 Company Prefix. At 

tills stage, however, the LEI may not be used in fmancial transactions. 

• A company creates reference data for its LEI, in the form of an electronic document 

conforming to a data standard to be established (e.g., XBRL template). 

• A company works with an independent auditor to obtain an auditor's certification for the 

reference data. The auditor applies suitable criteria as agreed by the industly. 

• The company submits its reference data in electronic form, together with the auditor's 

cettification, to the LEI reference data regish-y. In this way, the regish·y operator is assured 

of the accuracy ofthe incoming data. 

• The reference data regish·y confirms that an auditor's cettification is present, and performs 

additional quality checks on the completeness of the data, avoidance of duplicate data, etc. 

Note, however, that checks requiring a detailed understanding of the financial and legal 

situation ofthe registrant have been performed by the auditor, relieving the registry operator 

fi·om having to perform this task. 

Registration of LEis is subject to armual renewal. As pmt of the renewal process, a company 

must once again submit an auditor's certification as to the accuracy of its LEI reference data. In 

addition, regulators may require certification at other times; e.g., when a corporate action 

changes the ownership structure of an LEI. In this way, ongoing data quality may be mainta ined. 

The above comments apply to both the sh01t-tem1 and long-term solutions envisioned by GS 1. 

GSl Confidential/Proprietary 361 
GSl believes that the specific design decisions within the above framework, namely the design 

of the reference data submission document, the minimum criteria for auditor certification, and 

the minimum quality checks performed by the registry, are best determined through a global 

consensus standards process that involves all stakeholders, including solution providers, financial 

market pa1ticipants, auditors, and regulators. We do not believe it is the place for GS1 or any 

single solution provider to dictate these decisions, and hence we do not provide further detail 

here. 

What avenue(s) will be available to the users of the proposed LEI solution to challenge and 

remedy tlata accuracy issues? How will you ensure the transpttrency of the clwllenge/remedy 

process? 

GS I 's existing registries utilize the following data challenge process. A request to review or 

amend data is received through GSJ 's customer service organization. A "ticket" is opened to 

track the request. GS l will then embark on a verification procedure to determine the appropriate 

changes to be made. This determination is reviewed with the data regish·ant. In the event of a 

disag,-eement, appropriate legal counsel is sought, and all pa1ties work towards a successful 

resolution. In all cases, an audit trail for the entire process is kept with the ticket, and remains 

available after the ticket is closed. 

GS I anticipates using a similar data challenge process for financial reference data, which GS I 

will design in consultation with financial industry stakeholders. 

What processes will you implement to periodically verifY, and update the LEI data while 

maintaining an audit trail? How will the process be initiated, coordinated and driven? 

GSJ Member Organizations verify company information as part of the annua l renewal and 

billing process. Engaging the Auditing and Accounting firms in the annual process will 

significantly improve data quality. 

The GLN Registry maintains an audit history by company of who added or modified a record, 

who approved the additions or modifications as well as the attributes that were modified. 

Describe the SLAs you intend to implement as part of the proposed LEI solution. Further, 

specifY how tlte relevant metrics (around process, volume, accessibility, availability, etc.) will 

be captured, measured, and published on an ongoing basis. 

The SLAs ultimately implemented will be dete1mined after gathering requirements fi·om all 

relevant indush-y stakeholders. The starting point will be the SLAs already in place for the GSJ 

US GLN Regish-y (for the short-term solution), and the GS1 Global Data Synchronization 

Network (for the long-term solution). 

For the short-term solution, the following SLAs apply: 

GSl Confidential/Proprietary 37l t l g ( V I It { l I ( 
Operates according to a documented service level agreement, which covers technical suppott 

availability, priority levels and escalation, service level benchmarks, maintenance windows, 

secUJity, disaster recovery, rep01ting, and acceptance criteria. The current availability target is 

99.9%, and tl1e setvice currently operates at that level. 

For the long-tetm solution, the following SLAs apply: 

The GSl Global Data Synchronization Network operates according to a documented service 

level agreement, which covers technical supp01t availability, priority levels and escalation, 

service level benchmarks, maintenance windows, security, disaster recovery, rep01ting, and 

acceptance criteria. The current availability target is 99.5% and the service cunently operates at 

99.9%. 

For both the short-term and long-term solution for fmancial setv ices, GS 1 will work with 

industry stakeholders to determine the appropriate service level requirements and develop a 

suitable SLA for the setvices offered for financial se1vices. 

Business Model 

Describe in detail your business model with a specific focus on how you plan to ftmd and 

sustain the effort? Cost for basic registration services must be kept very low. What is your 

estimate of the cost for basic registration and maintenance? 

GSl operates as a not-for-profit organization, and provides its services on a cost-recovery basis. 

The business model is very well established as GS I has been in operation for nearly four 

decades. As the GS I proposal is based on existing solutions (the GSI US GLN Registty and the 

GSl Global Data Synchronization Network), the solution is already fimded and sustained. 

See the next question for cost of services. 

Provide detflils ftrouml your proposed fee stmcture ami !tow you phm to account for usage, 

complexity, etc. 

The fee structure would be determined based on a consideration of the services to be offered and 

market requirements. We also expect that the fee sttucture would be determined on a percountty basis, reflecting different market conditions and expectations in each country. 

As a basis for comparison, here are highlights of GS 1 US's fee structure for the services which 

we propose to employ in the LEI solution. 

• The fee a GSI member pays to register a GLN and its associated reference data in the GS1 

US GLN Registry is based on an annual subscription which gives the subscribing company 

the right to register an unlimited number of LEis. The annual subscription fee is based on 

company size, and ranges from $250 to $8000 per year, with no limit on the number of LEis 

GSl Confidential/Proprietary 381 (, y ' 1 I 'I 
registered. In the case of a company with many LEis, the annual subscription fee is 

amortized over all the LEis that arc registered, resulting in a low cost per LEI. 

Describe the infomwtion ami services to which you will provitle free access. Provide details Oil 

how you plan on keeping the informtttion/services free 

GSl is prepared to offer to the public, free of charge, access to financial industry LEI 

information. The determination of which infom1ation will be publicly ava ilable will be 

constrained by regulatory considerations and, within those constraints, made through industry 

consensus as established by GSl 's Global Standards Management Process. GS J supports its 

operations on a cost-recovery basis fl"om membership fees and fees charged for services such as 

allocation ofGSl Company Prefixes and registration of reference data (see previous question). 

The GSl US GLN registry today offers a service free to the public on GS1US's public website 

that allows a user to enter a legal entity identifier and have displayed all of its registered data 

attributes. 

Provitle details on your ttbility to accommotlate requests for customized services within your 

proposed LEI solution. 

One of the key benefits of the federated model which GSl proposes for the long term is that each 

registrar (data pool) may offer its own customized services on top of the basic functions of 

registration and d1shibution of standardized reference data. The federated model allows different 

registry operators to compete on the basis of value-added or customized services which they 

offer. 

Why do you believe your operating mode/would deliver the most cost effective solution? 

The shott-term model proposed by GS1 is based on an existing registry for reference data 

associated with globally unique legal entity identifiers. Therefore, this will be extremely costeffective compared to other proposals because we are not proposing the construction of an 

entirely new service. 

The long-term federated model proposed by GSI delivers the most cost effective solution 

because it allows for competition between different registrars (data pools). We believe that freemarket competition is the best way to ensure low costs and high quality service fo r end users. 

Risk 

Describe in detail your ttpproaclt to business continuity planning and the measures you would 

adopt to ensure business continuity. 

Assuming that this question refers to continuity of the services that GSI will offer, GSI operates 

all services in accordance with commonly accepted indushy practice for highly available, 24x7 

GSl Confidential/Proprietary 391 lJ 
services. All services are hosted in external co-location environments, which GSl selects on the 

basis of the service level agreement that these companies offer. The continuity and disaster 

recovery processes that these providers employ include njghtly backups of all systems, off-site 

storage of backup media, automated fail-over, full semi-annual disaster recovery tests, and 

redundancy testing. 

Describe "pproaclt to prevent fraudulent LEis from being issued. 

As detailed in the responses in the "Operating Model" section, there are several points in the 

proposed process in which verification to prevent fraud will take place: 

• To obtain a GS 1 Company Prefix, a company must present proof of its corporate identity. 

• When registering an LEI and its associated reference data, the following checks occur: 

• The reference data must be submitted with an independent certification of accuracy from 

a financial auditor. The auditor is required to apply verification criteria as agreed by 

industry and regulators. 

• The regis tty verifies that the GS 1 Company Prefix potiion of the LEI corresponds to a 

GSl Company Prefix that was duly issued and is still active. 

• The registry performs other self-consistency checks on submitted data; e.g., checking for 

dupljcate LEis. 

• In addition, we anticipate annual renewal of registrations as well as renewal at the time of 

corporate actions affecting LEI reference data, and the same checks apply at each of these 

renewal points. 

• Access to LEI reference data to regulators, auditors, and, where permitted, to the public 

provides an opportunity for other patties to perform additional verification. 

Legal and Compliance 

How would your solution support regiOil(l/ conventions and regulations lmd provide loc(l/ 

certification while being lt global solution? 

As described earJjer, the long-tenn solution envisioned by GSl is a federated mode~ in which 

there are many registrars (data pools) worldwide providing service to a regional market, 

collaborating with each other to create a seamless global system for registration and dishibution 

ofLEI reference data. 

A key benefit of the federated model is precisely that it allows for regional conventions, 

regulation, and certification. Each participating registrar may be subject to the applicable local 

regulation, and local regulators may specify which registrar worldwide may be used for 

GSl Confidential/Proprietary 40 I 
registration of LEI reference data in that patt icular regulatory regime. In that regard, local 

regulators may impose local cettification requirements for registrars to operate in their 

jurisdiction. 

This model allows for wide variation in the conventions and regulations that apply in any given 

market. For example: 

• In countries that follow free-market principles, we expect that regulators will permit any 

number of privately-operated registrars to come into existence and compete to provide LEI 

registration services to end users. They may compete on the basis of additional se1vices 

offered, ability to serve cettain classes of end users better than others, etc. 

• In some countries, the local regulators may wish to designate a single registrar as the sole 

authorized data pool petmitted for use in that countty. In such countries, the local registrar is 

a quasi-governmental function, and subject to oversight and regulation by the local 

govemment. 

• In some countries, the government itself may choose to operate the registrar for that country, 

and exercise tight regulatoty control. 

This type of variation exists today among the 28 data pools in GS 1 's Global Data 

Synchronization Network, which collectively serve 132 counhies around the world. 

As noted in the "Operating Model" section, the federation of multiple registrars worldwide is not 

the same as the cun ent situation of many independent identification systems across the globe. 

The difference is that in this proposal, all fmancial identifiers are allocated from the same 

globally unique space of financial identifiers, and so a given legal entity has one identifier that is 

the same in eve1y data pool that has a copy of its reference data. The reference data is also the 

same regardless of which registrar is used to query for that data. 

Besides the registrars, there are components of the proposed GSl solution that are provided by 

GSl itself, such as the issuance of GSI Company Prefixes that give end users the capacity to 

create LEis and maintain minimum data attributes that regulators require for performing their 

oversight functions. 

For these components, regional conventions and regulation are fac ilitated by GSI 's 110 

"member organizations" around the world, which provide GS l services to their respective local 

markets. Each GS I Member Organization offers training, education, and customer service in a 

manner tailored to the local market. 

GSl Confidential/Proprietary 411 II l I 
Governance 

Describe your internal governance structure tmd how it ensures all aspects of the LEI solution 

will he properly administered. 

GSl has a federated govemance structure that ensures balanced representation of stakeholders 

both locally and across the globe. The GS I organization consists of a 1 ] 0 country-specific "GS 1 

Member Organizations," and is overseen by the GS1 Global Office. 

Each of the 110 GS1 Member Organizations has a board of governors that is composed of 

stakeholders across all industry groups and stakeholder types that the Member Organization 

serves, including local regulators. The GSl General Assembly consists of the chairman and 

CEO of each of the 110 Member Organizations, and is the high governing body in GSl. The 

General Assembly approves GSJ Global Management Board nominees consisting of global 

industry leaders and member organizations. 

Specific activities ofGSI are govemed by these bodies in the following way: 

• For standards development under the Global Standards Management Process (GSMP), draft 

standards are balloted by all member companies that patticipate in the GSMP, and then 

submitted to the Board Committee for Standards (a sub-committee of the global Management 

Board). The Board Committee for Standards confirms that all due process steps of GSMP 

were followed in creation of the draft standard, and then recommends ratification to the 

global Management Board. The global Management Board ratifies the standard on behalf of 

the General Assembly. 

• For pricing, local services, and other aspects that are patticular to a given GSJ Member 

Organization, tbe local Member Organization's board governs. 

• For matters of policy that petiain to GSl globally, other than ratification of standards as 

described above, tbe General Assembly governs. 

Describe whether there are lmy constNtints on your organiztttion(s) being overseen by tl broadbased governmzce hotly comprisetl of members from indust1y and the regulatory community. 

As noted above, this is precisely how GSl 's govemance already operates. 

Information Security 

Describe in detail your proposed steps to safeguard the privacy of the information stored 

within LEI systems while atlhering to regulatory mmulate. 

Both the GSl US GLN registry and the GS I Global Data Synchronization Network employ the 

following security safeguards, among others: firewalls, multiple trust zones, authentication of all 

users, required periodic password change with strict rules on password construction, antiGSl Confidential/Proprietary 42 I p .1 I Y 0 l I l I l t I l 
virus/anti-malwru·e protection, 128-bit SSL, cross-site scnptmg blocking, countermeasures 

against SQL intrusion, data center physical secUtity and environmental controls, mock disaster 

recovery drills, and qualified system administrators. 

For the communication between data pools in the federated Global Data Synchronization 

Network, AS2 with 168-bit encryption is employed for all messaging. 

Security measures conform to SysTrust and PC! standards. 

More detail regarding security may be provided under NDA. 

What processes will you put in place to contain and manage a potential security breach? 

See previous answer. More detail regarding security may be provided under NDA. 

Solution Technology 

Describe in 1letail your proposed solution technology including security (including access 

controls), business continuity, network, lutrdware, d1ttabases, interfttces (web-based, 

messaging, protocols 1md fonmus), ami programming languages and paclmges used (e.g. 

J2EE). 

GS 1 will provide information of this kind under NDA, if needed. 

Describe your technology lifecycle mamtgement processes 1md capltbilities, including but not 

limited to development, QA, release management, database schema clumges, and bug fixes. 

Both the GSl US GLN Registry and the GS1 Global Data Synchronization Network employ a 

lifecycle management process which is governed by a detailed, written development process 

manual. The process includes steps of requirements gathering, technical analysis, release 

planning, design, development, QA, and implementation. Wlitten design artifacts are employed 

at each stage, with change control and required sign-offs. Release roadmap planning is 

employed to provide customer visibility to upcoming changes. Testing includes unit testing, 

integration testing, perfmmance testing, and security testing. Beta and certification testing is 

also performed. A formal process of build migration and customer notification takes place when 

a new release is ready to deploy. 

We will share more details under NDA, if needed. 

GSl Confidential/Proprietary 431 1 I., ( ( !' 11 J 0 I I t c; I J' 
While documenting your solution, elaborate, flS ltppropriate, lzow the solution will comply with 

tlte technical principles listed in the document. 

How would you ensure that the technology solution described herein will be ftble to lutmlle the 

volume, updltte frequency fmfl speed requirefl as the solution is ftdopted on a global basis? 

As noted earlier, the GSl US GLN registiy today has nearly 300,000 legal identifiers registered, 

and the GSl Global Data Synchronization Network has 6.8 million identifiers registered each 

with thousands of data attributes. Both of these systems in their current versions have been in 

continuous use for five years or more. Their current capacity and usage is therefore already at 

the levels that are expected to be needed in the shott term, and also ah"eady at the levels outlined 

in the "linchpin" report. These systems are well positioned to continue to scale as volume 

eventually surpasses current levels in the very long term. 

Operationally, both registries are monitored daily to ensure performance levels are maintained at 

99%. Stress and volume testing are performed and setvers/applications are adjusted if required 

based on the results. 

Implementation Plan and Roadmap 

Layout the project plan highlighting the phasing strategy, various implementation phases, 

milestones, fmd de/ivembles. Describe how you will adhere to the best pntctices related to 

implementing a solution ojU1is scale. 

The project plan and schedule will be developed based on understanding both the requirements 

of participating fmancial entities as well as regulators. It is impossible to commit to a schedule 

at this time; however, the following exampl.e is indicative of what we anticipate such a schedule 

will be: 

• July 2011 - GSl is selected to provide legal entity identification and registration of LEI 

reference data 

• October 2011 -the definition of the Tequired legal entity reference data elements is finalized 

througl1 consensus of financial indushy stakeholders, including regulators, struiing from the 

19 attributes identified in the SIFMA-led requirements document. Legal entity identifier 

allocation mles are also established through a similar process, starting from the GSl GLN 

allocation mles. 

• January 2012 - enhancements to the GS1 US GLN Registry are made to suppo1t the new 

reference data attributes beyond the attributes a1Jeady present (some of which overlap with 

those required for the financial industry). In parallel with this, fmancial industry ouh·each is 

performed to make financial institutions aware of the new legal entity identifier, and the 

processes for obtaining a GSI Company PrefJX and for registering reference data. 

GSl Confidential/Proprietary 441 J' il r. ( ",J y r [! 1 I (l > () J J ( I II 
• April 2012 - a pilot is completed in which a selected number of financial institutions create 

legal entity identifiers, register reference data in the GS 1 US GLN Registry, and business 

processes simulated to show the use ofLEis and their reference data in financial transactions. 

Regulators will be part of this process. Following completion of the pilot, all financ ial 

industry participants are invited to create and register their LEis. 

• July 2012 - the LEI registry is operating in steady state. 

Simultaneously with the above schedule, global outreach begins to lay the groundwork for 

expansion of the system on a global basis. The pace and schedule for this work is highly 

dependent on the regulatmy environment in other countries. 

Note that the above schedule is dependent on tasks that are outside GS 1 's control, such as the 

timing of the industry to come to consensus on the needed reference data elements, the 

willingness of fmancial companies to participate in the new system, etc. These obviously will 

have an impact on the schedule. 

Provide detltils around your proposed team structure llml implementation govenumce model 

including communication, and escalation channels. Include recent bios for personnel 

proposed for initial phases of work. 

The following functional depa1tments within GS 1 US will be employed in ro lling out a shaltterm solution based on the GS 1 US GLN Registry: 

• Technology Delive1y Responsible for the design, implementation, and operation of the 

software systems involved. Managed by the Sr Director Technology Delivery repmting to 

the CFO. 

• Indushy Engagement Responsible for outreach to the financial services community and 

liaising with other outside organizations, regulators, trade organizations, etc. Managed by an 

industry VP to be assigned to the financial services industJy, repmting to the SVP Industry 

Engagement. 

• Solutions and Marketing Responsible for suppmting industly engagement and current 

customers through marketing effmts. Managed by the VP Solutions and Marketing, 

repmting to the SVP Solutions, Customer Engagement, and Human Resources. 

• Customer Programs Responsible for customer suppmt and the call centers. Managed by 

the VP Customer Programs, repo1ting to the SVP Solutions, Customer Engagement, and 

Human Resources. 

• Legal Includes both in-house counsel and outside firms. Repo1ts to the CFO. 

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• Emerging Capabilities and Industries Responsible for business development and Liaising 

with the GS1 Global Standards Management Process and outside standards orgamzations. 

Managed by the SVP Emerging Capabilities & Industries. 

All of the above repmt to the CEO. 

For the long-term global solution, a federated organization will include a similar table of 

organization within each GSl Member Organization that serves the financial sector in their 

country. The details of each such organization are tailored to the customs of each individu al 

country. In addition, the long-term federated solution relies on a network of data pools which are 

independent companies typically organized as a software solutions and services company. 

In addition to the above, all standards development is carried out through the GS1 Global 

Standards Management Process, whose governance is described elsewhere in this response. 

Names and bios may be shared under NDA, if appropriate. 

Describe how you will implement this solution to ensure that issuing tmd registration 

processes can begin within 12 months. 

As noted earlier, the solution we are proposing is built using the ex;sting GS 1 GLN identifier for 

legal entities, and the existing GS 1 US GLN Regishy for legal entity reference data. Therefore, 

there is very low risk in achieving operational status within 12 months, because the system 

already exists and has been in use for 7 years. The onJy changes required are the definition of 

additional data athibutes beyond those akeady implemented in the GLN Registry. As noted 

earlier, 10 ofthe 19 attributes identified in the SIFMA-led Requirements document are already 

implemented in the GLN Registry, and so the total enhancements required amounts to adding 

approxin1ately nine additional atttibutes. Provided that the indush·y comes to a quick consensus 

on precisely what attributes are required, 12 months appears adequate to make this small 

enhancement. 

Resourcing 

Describe the number, skills, and experience of the staff you have or will retain to deliver the 

LEI solution. Be sure to provide details for each .fimctiomtl category, i. e., daltt, openttions, 

technology, legal, complitmce, risk, intellectual property rights, information security, and 

solution implementation. 

Within GS 1 US, the approximate numbers for each of the functional areas listed two questions 

above are as follows: 

• Technology DelivetJ' 19 

• lndust1y Engagement 20 

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• Solutions and Marketing 20 

• Customer Programs 41 

• Legal 3 in-house staff, and 3 external law fu·ms with specializations in international and 

intellectual property law 

• Emerging Capabilities and Industries 11 

For the long-term global solution, there would be similar numbers in each of the pa1ticipating 

counhies, scaled as appropriate given the size of counhy. 

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