LSE suitors told to ring-fence clearing services

LSE suitors told to ring-fence clearing services

The UK's Competition Commission says that Euronext and Deutsche Börse would have to ensure the independence of the London Stock Exchange's clearing services provider if they want to take over the Exchange.

The competition watchdog's undertakings give effect to the findings of its preliminary report on the proposed mergers that was published in November. At that time, the CC found that the acquisition of the LSE by either of its continental rivals was likely to give rise to a substantial lessening of competition.

In a statement, the Commission says: "The undertakings require each party to implement a package of structural and behavioural remedies to ensure the independence of LSE's clearing provider, should they acquire LSE."

On this basis, Deutsche Börse would only have to take action if it replaced the LSE's current clearing services provider, LCH.Clearnet, with one in which it holds an interest. Euronext, on the other hand, would be expected to reduce its stake in LCH.Clearnet to 14.9%.

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