https://www.accc.gov.au
The ACCC will not oppose the proposed acquisition of
LSEG and Refinitiv are global companies supplying financial markets infrastructure products and services to financial industry professionals.
In
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The ACCC examined horizontal overlaps where both parties supply competing products and services along with a number of vertical relationships between LSEG and Refinitiv, where one party supplies inputs to the other or its rivals.
The merger investigation was extensive and involved contact with a large number of stakeholders and examination of internal documents.
"We consulted with a wide range of competitors and customers and the majority did not express concerns with this transaction," ACCC Chair
The ACCC found no material competition concerns in relation to horizontal aspects of the transaction.
In terms of the vertical relationships between LSEG and Refinitiv, the ACCC considered whether the merged entity could favour Refinitiv's trading venues and platforms in the provision of LSEG's clearing services. The ACCC also considered whether the merged entity could restrict LSEG's clearing services rivals from accessing Refinitiv's trading venues and platforms.
"We determined that the merged entity was unlikely to engage in anticompetitive foreclosure as a change to the established open access approach was likely to lead to commercial, reputational and regulatory risks,"
The ACCC also investigated whether the merged entity could affect competition for financial indices and financial data products by restricting rival providers' ability to distribute those products via Refinitiv's real-time data feeds and desktop terminals, or if rivals rely on the merged entity for inputs such as currency benchmark rates, pricing data for financial instruments and security identifiers.
"The industry is characterised by interconnected relationships, where large, sophisticated market participants are often both customers and competitors of each other across different products and services. If the merged entity sought to disadvantage rivals, there would be a negative response from industry and the potential for increased regulatory scrutiny,"
"Such a strategy could also diminish the value of the merged entity's offering relative to competitors. Rivals would likely be able to effectively leverage their bargaining power to defeat any attempted price rise or decrease in service quality."
Further information is available at:
Background
The proposed acquisition is a global transaction and is being considered by a number of competition regulators around the world, including the
LSEG is an international financial markets infrastructure business. Its global business activities include: capital markets trading venues and platforms (for example,
Refinitiv is a financial markets data and infrastructure business. Its global business activities include: financial data and analytics including real-time data feeds (Elektron), desktop terminals (Eikon) and financial security identifiers (RICs)), capital markets trading platforms (Tradeweb and FXall), and index licensing (including WM/Reuters foreign exchange benchmark rates).
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(C) 2020 M2 COMMUNICATIONS, source