LMAX provides the retail CFD and FX investor with a highly sophisticated but easy-to-use neutral platform that seeks to offer traders a fairer and more transparent alternative to competitors’ offerings. The platform is a Multilateral Trading Facility (MTF) that brings together retail and institutional buyers and sellers in a wide variety of financial instruments on a level playing field. Through the platform, LMAX delivers customers fairness, transparency, neutrality and a more efficient and open way to trade.
Betfair, the world’s leading sports betting exchange, established LMAX and is the majority shareholder in the platform.
The Shearman & Sterling team advised on the innovative structuring of the MTF platform. The team assisted in establishing the legal framework with platform members (including drafting and negotiating bespoke arrangements with institutional liquidity providers as well as providing advice on complex regulatory issues from client money protections to regulatory capital).
CFD trades on LMAX will be centrally cleared through LCH.Clearnet Ltd, protecting members against counterparty risks. LMAX is the first industry initiative to move retail derivatives into exchange trading and central clearing in line with regulatory moves in Europe and the US to encourage exchange trading and central clearing of derivatives generally. Shearman & Sterling has previously advised ICE Clear Europe Ltd in establishing a clearing platform for credit default swaps. Shearman and Sterling also advised on the acquisition by Goldman Sachs of a 12.5% interest in the platform.
The Shearman & Sterling team of lawyers in the firm’s London office is being led by Financial Institutions Advisory & Financial Regulatory partner Barney Reynolds and counsel Azad Ali, with assistance from associate Aatif Ahmad, M&A partner Lois Moore, associate Laura Rich, tax partner Iain Scoon, IP counsel Deborah Lincoln and antitrust counsel Antonia Horrocks.
