How to Trade on ACE

 

It is very simple to trade on ACE, simply contact the ACE offices or any ACE registered broker and they will facilitate the process.


The most secure way to trade on ACE and to access financing is through the warehouse receipt system. It is not a requirement to trade using a warehouse receipt, but it is highly recommended as doing so provides additional security to the parties involved (buyer and seller).

 

There are a few steps that need to be completed when trading on ACE, to ensure the contractual relationship between the buyer or seller, the broker and ACE.

 

1)   Contract of Agency

Both the buyer and the seller must sign a contract of agency authorising ACE or a broker to contract on their behalf. The contract of agency gives clear instructions to ACE or the broker on what terms and in what price range the buyer or seller is willing to contract. ACE or the broker will then place a bid to buy or an offer to sell (following the instructions in the contract of agency) onto the ACE trading system. The bid or offer will immediately appear on the market information screen.


2)   Negotiation Process

The bids and offers on the market information screen will be promoted on the internet, email, SMS, newspapers and radio.  If a buyer or seller is found, they can either place a counter bid/offer or accept the active bid or offer. If a counter bid/offer is placed the seller/buyer will be notified and can again either react with a counter bid/offer or accept.


3)   Contract Generation

When one party accepts a bid or offer on the ACE trading system a binding contract is generated and performance according to the terms on the contract can begin. The contract is entered into by ACE or the brokers, but it binds the buyer and seller with the full force of the law, which is derived from the signed in the contracts of agency.


4)   Performance

If the contract does not involve a warehouse receipt, then performance is left to the parties. If the parties agree, ACE can assist with inspections, transport and settlement. In these circumstances, the buyer will be required to deposit into the ACE Settlement Account and once seller has performed, the contract value will be released after paying any outstanding amounts due in respect of storage, transport, broker fees handling or ACE commission.
        

5)   Dispute Resolution

Any dispute arising on any matter under the auspices or related to the ACE shall be referred to arbitration in terms of regulation 38 of the regulations of ACE. The arbitration shall be conducted in terms with the ACE Arbitration Rules and any award consequent upon such arbitration shall be valid and binding upon all the parties thereto.