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Decisions
Discussion itemsitems 20150630 FIBO-BE FCT.docx
20150630 FIBO-BE FCT
Walkthrough of the taxonomy of kinds of legal or business entity. Note that business entity as intended here is intended to be very broad, not a legal formal definition. The reason we created class called "Business Entity" was (1) because it's an intuitive concept and (2) because in banks onboarding, they need to identify those entities which are onboarded as business accounts. That is, Business Entity is synonymous with potential business bank account customer in a retail context. These are logical grouping of kinds of entity. So for instance a sole proprietorship is considered a business entity, since it has a business bank account, as is an unincorporated association, a non profit, a club and so on, as these all get given business bank accounts as opposed to retail consumer accounts.
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Action: David will move InvestmntFund to RelativeThing (under FunctionalEntity), but first will run this past Jeff Braswell in case there are any cases that fall outside of what we are saying here.
Question: Kristin: in getting an LEI might not it's the funds – there is one scenario where this might not hold. We need to think about the current requirement to allocate LEIs to funds that that are trading swaps. These Having thought about this some more, Kristin agrees that these are acting as legal entities. Do So to the question, ‘Do these fall into the definition we are describing? There ’ Yes, there must be some kind of entity (corporate entity, partnership or trust) that is already trading (in order to own or buy anything), so Kristen agreed that this is probably consistent (Kristin)with what we have been saying
Moving on: looking at things like limited liability companies, which are only defined in the US, while other forms may exist elsewhere. Joint Stock Company is defined in the US as well. Current model does not include the UK specific jurisdiction defined entity types. Reloaded so we are also looking at that. Unlimited Company is defined in the UK, and is something with unlimited shareholder liability.
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Action: Dennis will call a special meeting to address this purpose. This will focus on how we classify the concepts, rather than the automated testing of the physical integrity of the resulting models. At present there is clearly ambiguity in the BE models, so it makes sense to meet with the FBC folks and get their perspectives.
Ownership and control. This This is an example of the Lattice Pattern. There is e.g. an Ownership lattice. (Note: Lattice is the low level pattern; Partitions are the top level pieces of the upper ontology e.g. Relative Thing). The lattice describe how the partitions are to be applied in a specific business concept area, such as ownership, control, etc. The relative to independent relation is called isPlayedBy,with the inverse being playsRole. The ownership lattice is symmetrical there are owners and assets (this is not the case for all uses of the partitions). This gives two roles, as perspectives on the instances of something playing that role in that context. There are direct relationships of ownership between independent things.
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Q: Majority interest versus Controlling Interest? A: Majority is usually 50% + 1. Controlling interest is very generic not clear. Thompson Reuters uses Any Interest and Controlling Interest interchangeably. The TR model has Controlling Interest as anything that is going to force that parent relationships, similar to the 50% +1; other ways to deem something a parent relation. Then there are also influence relationships, which are typically 50% or less, but has some significant relations. Then even within that, you might be "deeming" such based on a cutoff of 20% or 25% or other borders to this term. These are all affiliate relations. Then there is the Joint Venture relationship, which may also be control, majority or other. Can be duplicative. So there are nuances even in the simplistic breaks that TR chooses. Recognize that there can be a controlling entity, aggregate ownership, indirect ownership and so on.20150630 FIBO-BE FCT.docx
MB explains the original FIBO distinction between controlling interests and de facto control.
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David suggests there is not a single right answer but we need an answer.
Action items David Newman David recommends we remove Investment fund from the current hierarchy since the end result of looking at the existing models and of future work will be that it is no longer in this taxonomy of kind of independent thing as autonomous agent. As long as we have the full range of things that could elect to register to function as an investment fund, then we are good. Whichever kind of thing registers to be an investment fund, needs to exist, and register, and be given an LEI. David will move InvestmntFund to RelativeThing (under FunctionalEntity), but first will run this past Jeff Braswell in case there are any cases which fall outside of what we are saying here.
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Dennis Wisnosky Call a combined BE and FCB meeting. This will focus on how we classify the concepts, rather than the automated testing of the physical integrity of the resulting models
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