IntercontinentalExchange (ICE) has been forced to rethink plans for the launch of its new Singapore platform after a Chinese exchange threatened legal action to stop the US group launching two commodity futures that are copies of contracts offered in China.
The move by the Zhengzhou Commodity Exchange (ZCE) is likely to send shockwaves through the global futures industry because it signals that China will not tolerate foreign exchanges copying its futures contracts, and comes in spite of the practice of offering “lookalike” contracts being accepted around the world for years.
It also highlights how China appears determined to challenge a long-accepted industry norm in the way futures markets function just as big global banks are assessing plans by China to open up its Shanghai futures markets to foreign participation.