Brussels/Luxembourg — EU regulators told Deutsche Boerse and London Stock Exchange (LSE) Group that their $12bn deal to create the region’s dominant exchange operator risks eliminating rivals for clearing services, according to two people who have seen the statement of objections. Other clearing operators will have little or no chance of competing against the combined company, the European Commission said in a statement of objections it sent to Deutsche Boerse and LSE in December, the people said on condition of anonymity because the document was not public. Regulators say the two companies compete directly for so-called "bundle-to-bundle" integrated clearing services. This sets the bar high for any potential concessions. Clearing — a back-office function that acts as a firewall against defaulting traders — is a key rationale for the transaction, and also has been seen as the deal’s biggest hurdle from the announcement. Putting their operations together would potentially make deriva...
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