OFT lifts LME e-trading ban

OFT lifts LME e-trading ban

The UK's Office of Fair Trading (OFT) has lifted a ban that prevented the London Metal Exchange (LME) from extending the trading hours of its electronic dealing platform, LME Select.

The temporary ban - which was the OFT's first use of an interim measures direction - was imposed on 27 February 2006 and prohibited the exchange from extending trading hours on its LME Select platform to cover the Asian trading day.

At the time OFT said it was investigating "a suspected abuse of a dominant position" by the LME and the plan to extend trading hours on the LME platform would further restrict competition.

The temporary ban was imposed following a complaint from Spectron Group - a voice broker in the energy trading market - that any extension in the operating hours of LME Select would force its own eMetal platform out of the market.

However Spectron later said it had withdrawn its request because the OFT's measures attracted negative publicity in the market and restricted liquidity.

OFT says following new evidence, it no longer considers it is necessary to act urgently to prevent serious and irreparable harm to Spectron Group, but the watchdog says it continues to investigate "the suspected abuse of a dominant position by LME".

The decision to lift the temporary ban comes three weeks after the exchange lodged an appeal against the measures.

The LME says it is now free to extend the opening hours of LME Select. It had originally intended to do this on 1 March 2006 and it will now work with member firms to get the service up and running as soon as possible.

Simon Heale, LME chief executive, says: "We can now get on with serving the interests of the international metals community and work to have LME Select available during Asian trading hours as soon as possible."

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