21 February 2019

Shanghai FTZ will not allow LME warehouses, Reuters says

China will maintain a ban on overseas commodity exchanges setting up warehouses in the Shanghai free trade zone (FTZ), Reuters reported Wednesday, citing a government source with direct knowledge of the policy. The London Metal Exchange (LME), acquired by Hong Kong Exchanges & Clearing Ltd. (HKEx) (00388.HK) in December 2012, has sought for many years to set up delivery networks in China. However, the overriding concern is that the proposed LME warehouses in the mainland would pose a serious challenge to the Shanghai Futures Exchange, the source said. An official from the China Securities Regulatory Commission refused to comment, the report noted.

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