Global regulators set to stop Rio and BHP venture

BHP BILLITON and Rio Tinto’s $116bn (£72bn) joint venture in Australia hit another serious stumbling block yesterday when regulators in Germany and Japan moved to block the deal.

The German federal cartel office said yesterday it intends to formally object to the venture next week, and the Japanese fair trade body said it was concerned about the deal.

Steelmakers around the world have claimed that competition would be severely affected if the two giants were allowed to team up to share equipment in Western Australia.

The pair said in a joint statement they were disappointed, but “continue to believe that the joint venture is pro-competitive and will increase the supply of iron ore”.

The firms have not decided what action to take. Several global regulators including the European Commission and the Australian watchdog are also due to rule on the venture.