Why Is the Good Delivery Standard Important for Gold Investors?

The quality and authenticity of gold are paramount, especially for investors. The Good Delivery standard plays a significant role in this regard and offers numerous advantages. In this article we explain why the Good Delivery standard matters for gold investors and how it safeguards the security and value of their investment.

What Is the Good Delivery Standard?

The Good Delivery standard is defined by the London Bullion Market Association (LBMA) and sets out requirements for the quality, dimensions, and purity of gold bars.

Bars that meet the standard must have a minimum fineness of 995 parts per thousand and conform to precisely defined dimensions and weight, ensuring internationally recognised market acceptance and tradeability.

Dimensions of Good Delivery Standard Gold Bars:

Fineness: minimum 995.0 parts per thousand fine gold. Marks: serial number, refiner's mark, fineness, year of manufacture. Gold content: 350-430 troy ounces (11-13 kg). Recommended dimensions: Length (top): 210-290 mm (8.3-11.4 inches). Width (top): 55-85 mm (2.2-3.3 inches).

Older Good Delivery bars may differ from the above specifications but are still considered standard-compliant if they met the requirements applicable at the time of manufacture.

It is important to distinguish between the standards that apply to gold bars themselves and the requirements governing a refiner's inclusion on the Good Delivery List.

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The Advantages of the Good Delivery Standard

1. High Liquidity

Bars meeting this standard are globally recognised and readily saleable. This provides high liquidity, which is particularly important for investors, as the bars can be converted to cash quickly when needed.

2. Reliability and Authenticity

LBMA-approved gold bars meet the most stringent quality requirements, ensuring that the gold is genuine and unadulterated. This is especially important for investors for whom the authenticity of their investment is essential.

3. Consistent Quality

The standard guarantees uniform quality and purity across gold bars. This ensures that the value of the bars is not diminished by quality discrepancies.

4. Lower Risk

Standardised gold bars are less exposed to quality risks. This reduces uncertainty for investors and enhances the investment value of the bars.

5. Easier Verification

Every piece of standardised gold bar carries a unique identifier, enabling the tracking of authenticity and ownership. This increases transparency and security for investors.

Further Important Aspects of the LBMA Good Delivery Standard

1. Responsible Gold and Responsible Silver Guidance

The LBMA's Responsible Gold and Responsible Silver Guidance documents set out strict guidelines for ethical and sustainable gold and silver mining.

These guidelines aim to ensure the responsible sourcing of gold and silver, which is particularly important for investors who prioritise sustainability and ethical investment.

2. LBMA Physical Committee

The LBMA Physical Committee oversees the physical gold and silver markets and ensures that standards are applied consistently.

This committee is responsible for the maintenance and updating of standards, ensuring their continued relevance and accuracy.

3. Vault Managers Working Group

The Vault Managers Working Group comprises LBMA members responsible for operating the world's largest gold and silver vaults.

This group ensures the security and integrity of those vaults, which is of critical importance to investors.

4. LBMA Referees

LBMA Referees are independent experts who verify the purity and quality of gold and silver. Their work ensures that bars meeting the Good Delivery standards comply with the most exacting requirements.

5. LBMA Vaults

LBMA Vaults are accredited storage facilities that meet the LBMA's stringent security and operational requirements. These vaults ensure that gold and silver are stored safely and reliably.

6. Good Delivery Supervisors

Good Delivery Supervisors are specialists who monitor compliance with the standards. Their role is to ensure the consistent application of standards and the maintenance of quality.

7. Rounding Rules

The Rounding Rules specify how the weight and purity of gold and silver must be rounded in accordance with the Good Delivery standards. This ensures accuracy and consistency in measurements.

Why Choose Good Delivery Standard Gold?

Selecting standardised gold bars offers several advantages:

Market Acceptance:

Such bars are widely accepted and readily saleable.

Value Preservation:

The purity and quality of the gold are guaranteed, ensuring that the investment retains its value over the long term.

Security:

Unadulterated and certified gold bars offer greater security for investors.

Summary

Choosing to invest in Good Delivery standard gold affects not only the quality and value of the gold, but also the investor's peace of mind and security.

Selecting standardised bars facilitates selling, increases liquidity, and ensures that the invested capital continues to represent value over the long term.

If you are looking to invest in gold, a standard-compliant bar is a safe and reliable choice.

For further details and information about the Good Delivery standard, please visit the World Gold Council and LBMA websites.

Glossary

#### Approved Weigher

A list of weighers of gold and silver bars whose weighing equipment, measurement procedures, and competencies meet the standards prescribed by the LBMA.

#### Bars

In the case of gold, approximately 400 troy ounces; in the case of silver, approximately 1,000 troy ounces of fine bar.

#### Executive Committee

Responsible for reviewing work proposed or agreed by the board and its sub-committees in order to ensure the effective operation of the LBMA.

The Executive Committee is responsible for the following with regard to the Good Delivery List:

• maintaining and improving the high standard of the Good Delivery List;
• ensuring that the rulebook is kept up to date and fully implemented;
• reviewing identified issues and determining subsequent steps;
• making final decisions on applications and status.

The terms of reference (TOR) of the Executive Committee, the Board, and its sub-committees are available on the LBMA website.

#### Former Lists

A list of refiners and/or their bars that have been removed from the list. The Former Lists include:

• Refiners that no longer manufacture bars at the listed locations, and whose bars are still considered Good Delivery up to the point of their transfer to the Former Lists.
• Refiners whose bars are no longer accepted as Good Delivery by the London bullion market; from the date of their transfer to the Former Lists.
• Solely assaying companies that previously held Good Delivery status. Refiners must now be capable of both assaying and refining to the prescribed standard.

#### Suspension from the Good Delivery Lists

Refiners that fail to comply with the rules and requirements set out in the rulebook may have their Good Delivery status suspended until the matter is resolved to satisfaction.

During this period, new production does not qualify as Good Delivery.

#### Good Delivery List

The list of acceptable refiners of gold and silver bars for the London market.

#### Physical Committee

Responsible for the oversight, development, and protection of the Good Delivery List. It also ensures the maintenance of standards, with emphasis on continuous market improvement and transparency.

#### Referees

Referees are refiners appointed by the LBMA to assist in maintaining the Good Delivery system.

#### Responsible Sourcing Programme (RSP)

Established for Good Delivery refiners to comply with high-level standards in combating human rights abuses, avoiding contribution to conflict, and fighting money laundering and terrorist financing.

The RSP formalises and consolidates the high-level due diligence standards already existing among standard-compliant refiners.

#### Good Delivery Rules

The rules set out in the Good Delivery rulebook, including technical specification rules and quality assurance rules.

#### Supervisors

Supervisors of the Good Delivery system are responsible for witnessing dip-sampling and bar-casting operations related to the Proactive Monitoring Programme and report on these to the LBMA.

#### Vaults

Refers to LBMA members with market-maker status that also provide vault and gold bar clearing services to third parties.

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