Average LME transaction fee will rise 34% from Jan 1; discounts for short-dated client carries

The London Metal Exchange has confirmed the changes to its fee schedule for 2015, including a 34% increase in the average transaction fee.

Fees at the London Metal Exchange will rise from the start of 2015, with the cost of the average transaction increasing by 34%, the exchange said.

Annual membership fees are also up for ring dealing members in particular, who must now pay an annual charge of $95,000, up from £55,000 ($89,360) previously.

The tariff for trading has been simplified to provide an all-in transaction fee in US dollars, and will come into effect in January, the exchange said.

The all-in transaction fee will have trading and clearing components, charged in dollars to “align Exchange fees with the currency of the contracts traded”, it added.

Discounts will be offered for some trade types, including ring trade and short-dated client carry trades, on which there will be a 25-cent charge for trading and for clearing.

The LME has also decreased the fee for member-to-member give-up trades to 25 cents, while the LME Clear fee is unchanged.

Non-ring dealing on the exchange and all other client contracts will have a 65-cent charge for trading, and 25 cents for clearing, the LME said.

The discount for ring trading “reaffirms the LME’s commitment to the trading floor and recognises its vital role in the price discovery process”, according to the exchange.

The move will provide funding for “continued investment in IT, systems and service provisions”, linked to a changing regulatory environment and “necessary system upgrades”, it added.

“Our new tariff is integral to our evolution into a truly commercial global exchange and underpins our continued investment and our next phase of expansion,” Garry Jones, LME CEO and HKEx co-head of global markets, said in a statement.

“The new LME tariff is competitive and ensures we can continue focusing on innovation and offering users the highest levels of service.” 

Claire Hack
chack@metalbulletin.com
Twitter: @clairehack_mb

A full breakdown of the main fees and charges is below:
 


Futures, carries, traded options and TAPOs (per leg per side per lot) Fees (USD)
Contract type Category    Trading   Clearing        Total
Exchange Ring/Kerb  0.25 0.25 0.5
Non-Ring 0.65 0.25 0.9
Give-up  0.25 0.25 0.5
Client Short-dated carries 0.25 0.25 0.5
All other  0.65 0.25 0.9
Option exercise/assignment                 - 0.35 0.35
Cash settlement fee            - 0.08 0.08
Delivery fee             - 0.35 0.35
LME minis (per side per lot)   Fees (USD)
All - 0.25 0.25
Subscription and facilitation fees        
LME annual subscription  Fees (USD)
Ring dealing members   95,000
Associate broker clearing members   90,000
Associate trade clearing members 30,000
Associate broker members 75,000
Associate trade members 4,000
Individual members 500
Honorary members -
LME Clear recurring facilitation fees Fees (USD)
GCM clearing for other LME members  25,000
GCM Clearing for clients 17,000
ICM clearing only for itself 14,000
ISA fee (per additional a/c) 1,700
OSA fee (per additional a/c) 5,000
One-off fees Fees (USD)
LME application fee 4,000
LME Clear application fee 1,700

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