Reuters reported that US regulators have delayed by two months a ruling on BlackRock Inc's plan to launch a copper exchange traded fund backed by physical metal,a week after giving the go ahead to a similar product proposed by JPMorgan Chase&Co.
The US Securities and Exchange Commission set a new and final deadline of February 22 to rule on the BlackRock fund.It said it needed more time to consider the issues surrounding the Shares Copper Trust,which along with JPMorgan's fund has ignited fears among copper fabricators about their impact on prices and supplies.
The postponement comes just a week after the SEC gave the green light to JPMorgan's fund,saying it did not believe it would disrupt the availability of the metal.
That decision was seen as a benchmark for BlackRock's product.The SEC followed a similar path with JPMorgan,waiting to rule until the final deadline in order to investigate claims by copper fabricators that by hoarding more than 180,000 tonnes of copper off the market,the funds would inflate prices and tighten supplies.
There is one final regulatory hurdle that JPMorgan must cross before it can launch its product it must file a prospectus for the product with the SEC.
Copper end users who have launched a strenuous attack on the products may challenge the ruling in federal court.
Mr Robert Bernstein an attorney with the law firm Eaton&Van Winkle LLP,who is representing a consortium of fabricators,said he will decide whether to appeal the ruling on the JPMor gan XF Physical Copper Trust once he has analyzed the SEC's findings.He said that"I think there are grounds to appeal."
