Japan demands details of BHP bid for Rio

The Government of Japan has ordered BHP Billiton to provide details of its proposed $78 billion (£48.3 billion) bid for Rio Tinto, by 17th November.

In an uncharacteristic move, the Japanese Fair Trade Commission is issuing a compliance order demanding information on the proposed takeover.

If the details are not forthcoming, Japan’s competition regulators will almost certainly rule that the merger would be anti-competitive.

It is understood that if BHP then proceeds with a bid, legal proceedings against the company would be considered.

A combined BHP / Rio would control around 34% of the traded iron ore market and this has led to fears that prices would rise.

Furthermore, BHP / Rio and Vale, the Brazilian miner, would control over 70% of the global traded iron ore market.

Iron ore prices are a major concern in Japan because the country’s Nippon Steel and JFE are the world’s second and third-largest steelmakers; last year, Japan accounted for almost 15% of BHP’s revenues.