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Report: London Metal Exchange to delay ban on tainted metal to 2025

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Report: London Metal Exchange to delay ban on tainted metal to 2025

The London Metal Exchange intends to delay plans to ban the trading of metal brands tainted by human rights abuses by three years to 2025 due in part to a lack of support from major producers, Reuters reported Sept. 18, citing anonymous industry sources.

The postponement will also give producers that buy from artisanal miners more time to meet Organization for Economic Co-Operation and Development, or OECD, guidelines and give the LME more time to rethink its approach, according to the sources.

LME spokesperson Miriam Heywood said in an interview Sept. 19 that discussions are still in the consultation phase, and the exchange expects to release a response to the outcome in the coming weeks.

In October 2018, the exchange outlined plans to automatically subject metals such as cobalt and tin to more stringent reviews as they were perceived to be a higher risk, with intentions to complete an audit by the end of 2020. It also aimed to complete an audit for copper, aluminum and zinc by the end of 2021.

A few months later, 14 nongovernmental organizations sent a letter to the LME opposing the plan. "It is short-sighted and irresponsible of the LME to single out cobalt and tin as higher risk metals above others, or to single out (artisanal) material as implicitly higher risk," the letter said, according to a Feb. 7 Reuters report.

The exchange subsequently launched consultation on the new standards in April and said it aimed to have all metal brands undertake an assessment by the end of 2020, with any flagged during the process to be audited by the end of 2022.

The LME said it intends to encourage greater transparency around the sourcing of metals traded on the exchange to discourage potential financial crime and corruption risks. Human rights concerns include the use of artisanal and child labor in the Democratic Republic of Congo, a major source of cobalt.