European Commission approves acquisition of NYSE Euronext by InterContinental Exchange

On 24 June 2013, the European Commission issued a press release stating that it has cleared the acquisition of NYSE Euronext (“NYX”) by the InterContinental Exchange (“ICE”).  Both NYX and ICE operate in future exchanges, derivative trading platforms, and clearing services.  NYX is an operator of exchanges in the U.S. and Europe, and ICE is a global operator of exchanges in the U.S., Canada and Europe.

The Commission confirmed that the transaction would not raise competition concerns due to the fact that NYX and ICE are not direct competitors and due to the presence of other competitors that would continue to compete with both exchange operators.

It may be recalled that last December 2012, the European Commission prohibited the merger between Deutsche Börse and NIX, based on concerns that the merger would have resulted in a quasi-monopoly in the area of European financial derivatives traded globally on exchanges (together, the two exchanges control more than 90% of global trade in these products.)

The Commission investigated the proposed acquisition on multiple market platforms, notably the market for trading and clearing services for exchange traded derivatives (“ETDs”) such as agricultural commodities, soft commodities and U.S. equity derivatives.  Additionally, the Commission found minor overlaps in the areas of other agricultural ETDs, foreign exchange derivatives and bonds trading.

Finally, the Commission did not identify any vertical competition concerns with respect to trading and clearing of derivatives, as well as the provision of exchange connectivity services and front-end trade execution services.  [Anthony Reda]