Become a member

There are seven categories of membership each with different capabilities:

• Categories 1 and 2 – General Clearing Members who can trade for own account and on behalf of clients
• Category 3 – Individual Clearing Members who can trade for own account
• Category 4 – Non-Clearing Members who can trade for own account and on behalf of clients but who are not members of LME Clear and will therefore use the services of a Category 1 or 2 Member to clear their trades
• Category 5* – Entities who are involved in the physical market and or clients of Category 1, 2 or 4 Members, who wish to be associated with the LME brand
  * ^{_{Given that Category 5 Members are not Members of LME Clear or Trading Members, the LME does not conduct ongoing assessments as to the creditworthiness of such Members.}}
• Honorary – Honorary members.

More detail on these types of membership can be found in our membership categories section.

LME membership structure – criteria and capabilities (PDF)

LME Member Jurisdictions Policy (PDF)

There are two types of Registered Intermediating Broker (RIB) membership which offer different levels of access to our markets:

• Tier 1 RIB member
• Tier 2 RIB member

More detail on these types of membership can be found in our membership categories section.

RIB membership structure - criteria and capabilities (PDF)

LME members (Categories 1-4), LMEprecious members and RIBs must be regulated by the UK Financial Conduct Authority, a competent authority of an EEA State or benefit from an exclusion under the Financial Services and Markets Act 2000 (Regulated Activities) Order (“RAO”). Members wishing to issue LME registered client contracts to customers will need to demonstrate applicable regulatory authorisations.

Core LME and LME Clear systems

The LME operates three trading venues, an electronic trading platform (LMEselect), an open outcry trading floor referred to as the Ring, and the inter-office or telephone market.

Trading and matching

The electronic trading platform is called LMEselect. Orders may be placed into the central order book via the LMEselect GUI or via the LMEselect FIX API. Trades executed in LMEselect are automatically transmitted to the LME matching system, LMEsmart, and then into the clearing system, LMEmercury, operated by LME Clear. Trades executed in the Ring or in the telephone market are entered into LMEsmart using the LMEsmart GUI or the FIX member interface and are then automatically transmitted to LMEmercury for clearing. LMEselect is not a mandatory LME system but LME members generally opt to utilise the LMEselect GUI and the FIX member interface in order to execute LME contracts electronically and to offer their clients an electronic order-routing service.

Warrant management

LMEsword is the LME’s warrant management system. Warrants are issued by LME-approved warehouses and are bearer documents entitling the holder to receive delivery of a specific parcel of metal at a specified warehouse. LMEsword allows for the lodging of warrants with the depository and the transfer of warrants between account holders. When an LME contract goes to delivery, the seller will deliver a warrant to LME Clear via the LMEsword system and receive cash in return. Conversely, the buyer will receive a warrant from LME Clear into their LMEsword account via a random allocation process and make payment to LME Clear.

Position reporting

Category 1, 2, 3 and 4 Members are required to report all warrant holdings, LME positions for house and client accounts and open interest as at the close of business each day. These reports must be made electronically the following morning via the LME’s Daily Position Reporting System, LMEdprs.

Systems access options - base metals

System		Cat 1	Cat 2	Cat 3	Cat 41	Cat 5
LMEselect	Electronic trading	O	O	O	O	O
LMEsmart	Post-trade matching and registration	R	R	R	O	N
LMEmercury	Clearing and risk management	R	R	R	N	N
LMEsword	Warrant management	R	R	R	O	N
DPRS	Daily position reporting	R	R	R	O	N

_{¹ Category 4 Members are Non-Clearing Members (NCMs) and may choose to outsource post-trade and reporting activities to their nominated clearer}

Key
R	Required
O	Optional
N	Not required

Connectivity arrangements

Connectivity to core LME and LME Clear systems can be achieved via leased line connectivity to LMEnet, via an approved Independent Software Vendor (ISV), or via proximity hosting in the LME’s Community Data Centre’s (CDC) in InterXion. LMEnet connectivity provides access to all LME systems. Category 1, 2, 3, and 4 Members who are accessing systems directly need to ensure their chosen solution provides connectivity to all required systems, or that they put in place arrangements to outsource any other required system access to another LME member.

		CDC	LMEnet	Approved ISV
LMEselect	Electronic trading	Y	Y	V
LMEsmart	Post-trade matching and registration	Y	Y	V
LMEmercury	Clearing and risk management	Y	Y	V
LMEsword	Warrant management	Y	Y	V
DPRS	Daily position reporting	Y	Y	V

 

Key
Y	Provided access
N	Does not provide access
V	Varies from provider to provider

Requirement to hold B shares in LME Holdings Limited

Candidates are required to comply with a number of financial and regulatory criteria and hold a minimum shareholding of B shares in LME Holdings Limited, as set out in the table below.

Base category	B share requirement
Category 1	25,000
Category 2	25,000
Category 3	5,000
Category 4	2,500
Category 5	0
RIBS category	B share requirement2
Tier 1	2,500
Tier 2	0

_{¹ Existing members of the base service are not required to own additional B shares unless the B share quantity owned is less than the minimum B share holding requirement for the intended category of LMEprecious membership.}

_{² Existing members of the base service are not required to own additional B shares unless the B share quantity owned is less than the minimum B share holding requirement for the intended category of RIB membership.}

Process for acquiring B shares in LME Holdings Limited

Candidates must source the minimum number of B shares for the category of membership they are applying for from existing B shareholders in order to satisfy the membership requirements.

Candidates are invited to enter into bi-lateral discussions with holders of excess B shares set out in the schedule. For a list of current B shareholders, please contact the Market Access team.

In the event that a candidate has exhausted all lines of enquiry and cannot acquire B shares, LME Holdings Limited, in accordance with the B Share Scheme, can issue the requisite number of B shares to a candidate in order to satisfy this membership requirement. Further information can be obtained by contacting the Market Access team.

The B share sub-committee last convened on 23 June 2014, and after taking into account all relevant factors, it resolved to set the price at which LME Holdings Limited will issue B shares (if required) to £72 per B share. This price will be in respect of issues of B shares made between 24 June 2014 and 19 September 2014. For issues after this date, the B Share sub-committee will determine whether to maintain this price or change it.

B Share Scheme (PDF)