Timing of registration of LME contracts

Members are advised that section 2A.4.3 of the Procedures has been amended to reflect legal changes to the timing of the registration of contracts on the London Metal Exchange (LME).

Background

Until now, strictly speaking, LME contracts were only registered one hour after the closing of the matching system. However, this has never been the approach of LCH.Clearnet Ltd in practice; we have always accepted intraday business for registration.

The LCH.Clearnet Ltd Board has decided that the removal of this legal uncertainty would be beneficial to all market participants and would make the legal framework consistent with current practice. As such, the Rulebook has been amended to state that all transactions, unless suspended, are deemed to be registered as soon as they are matched in the LME matching system. Please note that the process regarding suspended trades still applies, see section 2A.4.2.1 of the Procedures for details.

This change removes any minor residual uncertainty as to whether LCH.Clearnet Ltd will register and novate all contracts on the LME intraday.

Members should note that we intend to make an identical change for contracts traded on LIFFE once the exchange has amended its Rulebook.

These changes for the LME will take effect on Monday 16th February 2009.

 
For further information please contact Lucy Hammond, +44 (20) 7426 7173 or lucy.hammond@lchclearnet.com.