Photo/Tan Yuhan (NBD)

March 9 (NBD) -- The Hong Kong Exchanges and Clearing Limited (HK00388) on Wednesday announced that its wholly-owned subsidiary LME (London Metal Exchange) and LME Clear were sued by several international investment institutions.

Commodity Asset Management LLC(US), Pala Investments Limited(Jersey), Pentimon Limited (BVI), Welton Investment Partners LLC(US) and Sunrise Capital Partners LLC(US) complained that LME's decision to invalidate affected contracts after 0:00 o'clock after March 8, 2022, is illegal interference with their human rights, claiming compensation of over £10 million.

It is noticed that this is not the only claim for compensation from LME due to the halt of nickel trading. In June 2022, US hedge fund Elliott Investment Management and Wall Street trading giant Jane Street filed lawsuits against LME and LME Clear, asking for compensation of $456 million and $15.34 million respectively, according to an HK bourse filing disclosed.

In response to the latest accusation, management personnel at LME and LME Clear on Wednesday believe that these claims have no legal basis.

The new claim did not raise any new issues from existing cases against the LME and LME Clear announced in June last year, said the HKEX. As such, the parties have agreed to a stay of claim pending the final determination of a judicial review of its decision to halt nickel trading and invalidate affected contracts, it added.

On March 3, the Financial Conduct Authority stated that it had begun investigating actions systems and controls implemented by LME between January 1st and March 8, 2022.

The Bank of England recently also issued a statement saying that it plans to appoint an independent supervisor who will regularly report on progress made implementing remedial measures at LME Clear aimed at improving governance risk management.

The London Metal Exchange will resume nickel trading during Asian hours on March 20, said the Exchange at the end of February.