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HKEx, LME Sign London-Hong Kong Trading Link MOU

by Mary Swire, Lowtax.net, Hong Kong
28 October, 2015

An agreement has been signed between group members of Hong Kong Exchanges and Clearing Limited to form a new trading link, the "London-Hong Kong Connect."

A memorandum of understanding on the proposed trading link was signed on October 21. If implemented, the link will enable Hong Kong Futures Exchange Limited (HKFE) eligible Exchange Participants to trade London Metal Exchange (LME) products, and HKFE Clearing Corporation Limited (HKCC) eligible Clearing Participants to clear those trades.

Development is said to be at a preliminary stage and further work needs to be done to determine the appropriate trading and clearing arrangements.

C K Chow, the Chairman of HKEx, said of the plans: "This is another step in the development of the HKEx Group. Our link will be an important bridge between Hong Kong and London, two of the world's leading financial centers. Intermediaries and investors in Hong Kong will be able to have fast, stable, and low-cost access to the LME."

"The LME's growing business ties with Asia, a major source of both supply and demand for the base metals industry, will become even stronger as a result of this project," Brian Bender, Chairman of the LME, added. "The MOU we signed today represents another close and mutually beneficial business relationship between China and the UK."

"As domestic investors gain more opportunities to move beyond their home market under China's gradual opening measures, we want to be able to offer them access to multiple asset classes so they can benefit from a broad variety of investment opportunities," concluded Garry Jones, HKEx's Co-head of Global Markets and Chief Executive of the LME.

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