Covered Entity (CE) means a financial counterparty, a significant non-financial counterparty, or another entity designated by the HKMA, but excludes a sovereign (i.e. central government of a country), central bank, public-sector entity, multilateral development bank and the Bank for International Settlements.
Financial counterparty refers to any entity for a one-year period from 1 September each year to 31 August of the following year, if the entity itself or the group to which it belongs has an average aggregate notional amount of non-centrally cleared derivatives exceeding HKD 15 billion. For significant non-financial counterparties, an aggregate notional amount of non centrally cleared derivatives exceeding HKD 60 billion is used to assess the need for margining using the same phase-in period defined for financial counterparty.
The margin provisions apply to the Bank only when it enters into transactions with a CE that are booked in the Bank’s book. However, the Bank will be subject to initial margin (IM) requirements if (i) the counterparty is a covered entity and (ii) both the Bank and the covered entity have an average aggregate notional amount of noncentrally cleared OTCD exceeding the threshold stipulated in the phase-in schedule.
Foreign Covered Entity (FCE) refers to an entity operating outside of Hong Kong which, if operating in Hong Kong, would be classified as a Covered Entity.
Some information is quoted from Source: https://en.wikipedia.org/wiki/Legal_Entity_Identifier.
Non official translation – If there is any inconsistency or ambiguity between the English version and the Chinese version, the English version shall prevail.