What is LBMA and what is its significance in the precious metal world (gold & silver)?

London Bullion Marketing Association (LBMA)

“The LBMA is an international trade association, representing the London market for gold and silver bullion which has a global client base. This includes the majority of the gold-holding central banks, private sector investors, mining companies, producers, refiners and fabricators. The on-going work of the Association covers a number of areas, among them refining standards, trading documentation and the development of good trading practices.” Source: http://www.lbma.org.uk

 

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What this means is its main purpose is to ensure the best quality and standard of bullion bars (gold & silver) produced and traded.  This is achieved by having a set of rules which members must comply.  This set of rules which is called Good Delivery List has stringent criteria that an applicant must satisfy.

                       

 
                                                                     

         

Public Gold Products: Bars and Coins

In order to be listed, a refiner must first satisfy the physical committee as to its standing, ownership, net worth and operating history.  In particular, it (refinery) must produce at least 10 tonnes of refined gold and 50 tonnes refined silver annually for 3 years before it can be considered for technical assessment.  Next, the refinery’s assaying ability is assessed by sending a set of reference samples (by LBMA) that the refiner’s lab must assay and must comply to the criteria laid down by LBMA.  If this step is passed, the refiner is required to submit bars for inspection by London Market representatives and technical testing by LBMA’s 5 Good Delivery referees (located in Japan, South Africa & Switzerland).

 

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In summary, LBMA is not just some “casual” label with insignificant value that a gold or silver bars have. 

 

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Among the benefit(s) of LBMA, which to me the most important is that precious metal produced from refinery that is member of LBMA is Goods and Services Tax (GST) exempted.  In Malaysia only Public Gold bars and coins are GST exempted.

Public Gold LBMA Bar

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Prepared by,

Wan Muhammad Yusri B Wan Alwi

Public Gold Authorised Dealer

PG00067660
SMS or Whatsapp: 012-8871702

wanyusri@gmail.com