Overview of buying-in
A firm admitted to membership of the London Stock Exchange (“the Exchange”) may request the enforced purchase of securities on behalf of another Exchange member, in accordance with paragraphs 5140 to 5153 of the Rules of the London Stock Exchange, in order to facilitate the settlement of a transaction executed on Exchange.
The following pages outline the timetables that are applicable according to the type of security concerned setting out the earliest time that a buying member firm (“requesting party”) may initiate the buying-in process to enforce delivery of securities. They also sets out the charges that will be incurred by the ultimate selling member firm (“liable party”) which has failed to deliver within these timeframes.
Where a transaction was not undertaken with a central counterparty the requesting party is required to attempt to resolve the unsettled trade directly with its counterparty. It is required to notify its counterparty prior to instigating the buying-in procedure.
In certain situations the Exchange will be unable to complete the buying-in process. Examples include:
- where the liable party is not a member of the Exchange;
- where an attempt to buy-in by the Exchange would have a significant market impact;
- where the Exchange is unable to source the security concerned;
- Gilt-edged securities.
Submission of a buying-in request
Processing of buying-in requests by the Exchange
Withdrawal of a buying-in request
Passing on of buying-in Notices (read-on requests)
Failure to buy-in
CREST residual mechanism
Buying-in request form (file xls - 60 KB)