The investigation comes as a result of an agreement signed in December 2009 between the two companies to establish a production joint venture covering both companies’ entire Western Australian iron ore assets.
The Commission will examine whether the joint venture would have a negative effect on competition on the worldwide market for iron ore transported by sea.
Iron ore is the main component of steel. Virtually all iron ore mined worldwide is used in steel production. Worldwide iron ore consumption is now picking up again following a slowdown as a result of the economic and financial crisis, and is forecast to grow steadily in the coming years.
Three companies, Vale of Brazil, Rio Tinto and BHP Billiton account for most of the iron ore sold worldwide on a seaborne basis.
In 2008, the Commission examined the acquisition of Rio Tinto by BHP Billiton under the EU Merger Regulation; that transaction was abandoned by BHP Billiton in November 2008.
The current investigation concerns the establishment of the joint venture for iron ore production, which would leave the marketing activities of the companies separate.
The opening of the investigation does not imply that the Commission has conclusive evidence of an infringement, but merely that it will investigate the case as a matter of priority.
Red Bull makes hydrogen fuel cell play with AVL
Formula 1 is an anachronistic anomaly where its only cutting edge is in engine development. The rules prohibit any real innovation and there would be...