31.12. 85 Official Journal of the European Communities No L 369/31 COMMISSION DECISION of 13 December 1985 relating to a proceeding under Article 85 of the EEC Treaty (IV/27.592 — Coffee Terminal Market Association of London Limited) (Only the English text is authentic) (85/565/EEC) THE COMMISSION OF THE EUROPEAN COMMUNITIES, Having regard to the Treaty establishing the European Economic Community, Having regard to Council Regulation No 17 of 6 February 1962, first Regulation implementing Articles 85 and 86 of the Treaty (1), as last amended by the Act of Accession of Greece, and in particular Article 2 thereof, Having regard to the notification and application for negative clearance submitted on 29 June 1973 and on 20 May 1985 by the Coffee Terminal Market Association of London concerning the Rules and Regulations of the Association, Having regard to the summary of the notification published (?) pursuant to Article 19 (3) of Regulation - No 17, After consulting the Advisory Committee on Restrictive Practices and Dominant Positions, I. FACTS The Coffee Terminal Market Association of London (CTMAL) is one of many commodity markets established in London. The commodity markets are self-regulatory organizations run by Commirttees of Management selected by members from amongst themselves, aided by secretariats, and using powers given to them by their members in market rule books. Although the markets are self-regulating, there is an element of supervision by the Bank of England. The object of the CTMAL is to set up and to administer a terminal market in London for coffee. A terminal market or a futures market provides organized facilities for concluding contracts for the purchase and sale of a commodity to be delivered at named future dates. Futures markets have been developed primarily to enable persons involved in commodity trading to protect themselves from the risks of adverse price movements. The CTMAL provides a market floor for trading and price-making, determines various technical questions such as allowable delivery months and the standard contract terms () O] No 13, 21. 2. 1962, p. 204/62. (2) O)J No C 204, 13. 8. 1985, p. 8. and procures the provision of clearing and settlement facilities. Trading is done on the floor of the market where dealers face each other with bids and offers being made by the system known as ‘open outcry’. The contract currently traded on the Coffee Market is for 5 tonnes, or a multiple of 5§ tonnes, of Sound Robusta CTMAL Standard (i.e. a quality defined in detail in Section § of the Rules of the CTMAL) and stored in a warehouse nominated by the CTMAL. All contracts traded on the London Coffee Terminal Market must be registered with International Commodities Clearing House Limited (‘ICCH’), an independent service company which provides clearing and settlement facilities for the CTMAL. ICCH has substantial capital and reserves and is wholly owned by six clearing banks. The principal functions of ICCH are to maintain and organize a ‘daily clearing’ of all trades and provide a guarantee for due fulfilment of contracts, in accordance with the rules of the CTMAL, to clearing members in whose names such contracts are registered. The number of Floor Members of the CTMAL, the only category of members permitted to trade on the floor of the market, is limited to 35, although this number may be increased by the Association in General Meeting. There are two other classes of membership: Home Associate Members and Overseas Associate Members. Their number is unlimited. Associate Members do not have the right to attend or vote at general meetings of the CTMAL. Applicants for membership may be of any nationality but must satisfy certain minimum capital requirements laid down from time to time by the Committee of Management. They must furthermore be carrying on business in the coffee trade and must have done so prior to membership for a period of time also to be laid down from time to time by the Committee. Applicants for floor membership must trade from an office in London established for that purpose. A detailed statement of the criteria for membership in force at any time may be obtained from the Association upon application. Membership may be transferred to another firm or company provided that other also meets the criteria for membership. All Floor Members must be members (‘clearing members’) of the ICCH and must register their contracts with the ICCH which in return for its fee guarantees the performance of the contracts.