As disclosed on 24 December 2013, The London Metal Exchange (“LME”), an indirectwholly-owned subsidiary of Hong Kong Exchanges and Clearing Limited (“HKEx” or the “Company”), was named as a defendant in a judicial review claim commenced by United Company RUSAL Plc (“Rusal”) and filed in the English High Court on 23 December 2013. The judicial review sought to challenge the LME’s decision to introduce changes in its warehousing policy as announced in its notice dated 7 November 2013. The decision on changes to the warehousing policy was made following a three-month market consultation commenced by LME in July 2013 on changes to its policy regarding the delivery out rates of LME approved warehouses. The hearing of the judicial review claim took place on26 and 27 February 2014, and judgment was handed down on 27 March 2014. Although the court found in the LME’s favour on nearly all substantive and procedural points raised by Rusal, and made no adverse comments on the substantive merits of the proposed changes to its warehousing policy, the court found in favour of Rusal on one specific procedural issue, that the consultation should have encompassed or made reference to the option of banning or capping rent in queues. The court recognised the LME’s interest in taking action to manage the queues in accordance with its obligation to maintain an orderlymarket and ensure the integrity of its price discovery function.
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