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* LME will set platinum, palladium benchmarks from Dec. 1
* Price will be determined via electronic platform LMEbullion (Adds comments from London Metal Exchange, details)
By Clara Denina , Jan Harvey and A. Ananthalakshmi
SINGAPORE/LONDON, Oct 16 (Reuters) - The London Metal Exchange, owned by Hong Kong Exchanges and Clearing Ltd , will take charge of London's platinum and palladium pricing, also known as "fixes", from Dec. 1, replacing a teleconference with an electronic platform.
The unexpected move marks a stunning comeback for the LME, which failed to secure administration of the century-old London silver price benchmark - the first to go electronic in a wave of reform for precious metals pricing procedures.
It also puts the world's biggest metals marketplace back in contention to take over the much larger gold benchmark.
"We built (our electronic platform) primarily to participate platinum and palladium but the gold fixing process is very similar, so what we said is that if the market would like to use (it) for gold as well then we are very happy to discuss that," the LME Head of Business Development Matthew Chamberlain said in a phone interview with Reuters.
The platinum and palladium benchmarks were established in 1989, when banks chose to agree a price twice a day on which their customers - producers, consumers and investors - could trade the metal and value their holdings.
This unified the way all precious metals markets set their benchmarks. The gold fix began in 1919 and silver back in 1897.
The new pricing process will be run via bespoke platform LMEbullion, which is an electronic version of the current round-by-round fixing process, Chamberlain said.
"It was fairly clear that what the banks wanted was the electronic version of what happens at the moment but with the addition of a lot of audit and reporting and compliance features," he said.
The platinum and palladium new auctions will have an initial price after which the participants will declare their interest. They will also have the ability to pause during the process to recalculate overall interest and allow customers to change their orders.
The four banks currently running the process said in July that it would seek a third-party administrator for its price benchmarks, following similar announcements from the operators of the gold and silver fixings.
It later appointed an independent chairman, former Barclays product manager Jon Spall of G Cubed Metals Ltd, to oversee the current fixes operated by HSBC, Goldman Sachs, Standard Bank and BASF Metals Ltd.
As of December 1, the LME will also become the independent chairman, Chamberlain said.
CME Group and Thomson Reuters were named in July as the administrator of the new silver benchmark, the LBMA Silver Price.
A process to find a new administrator of the gold fixing was launched last month by the London gold fixing company, with the support of the London Bullion Market Association (LBMA).
At least 15 companies expressed interest in replacing the London gold benchmark, but a shortlist of fewer than 10 will be published on Friday by the LBMA, sources said. Potential administrators include ICAP, the world's biggest interdealer broker, and CME Group and Thomson Reuters and the LME.
Scrutiny over the way precious metals benchmarks are set increased ahead of the implementation of stricter regulations on price setting from the International Organization of Securities Commissions (IOSCO) this year. (Reporting by A. Ananthalakshmi in Singapore, Jan Harvey and Clara Denina in London; Editing by Himani Sarkar, Susan Thomas, Veronica Brown and Hugh Lawson)