It is reported that The Japan Iron and Steel Federation has asked Japan's trade watchdog to review BHP Billiton Plc's proposed merger with Rio Tinto Plc and its potential impact on the iron ore and coal market.

Hoping to safeguard Japanese steel makers' negotiating leverage with natural resources giants, the Japanese steel industry group said it has asked the Fair Trade Commission to take necessary steps to ensure that a fair competitive environment in iron ore and coal trading is maintained.

The federation in a statement said that BHP's takeover of Rio Tinto, if successful, would reduce competition among the suppliers and possibly hamper fair pricing.

A steel federation spokesman said the group is asking Japanese trade authorities to come up with data showing the proposed merger's impact on the Japanese market and to cooperate with other countries concerned to take appropriate action. He added that the federation didn't give a deadline for the Fair Trade Commission's response.

While Japan's Fair Trade Commission has no jurisdiction over matters outside the country, Mr Hajime Bada chairman of the federation last month said that his group would propose that the trade watchdog consider approaching its Australian and European counterparts and encourage them to probe the BHP Rio Tinto pairing over competition issues.

The latest move by the industry group echoes opposition to the mining giants' merger from the International Iron and Steel Institute and regional steel industry groups. The European Confederation of Iron and Steel Industries, the leader in the global steel sector is also asking the European Commission to oppose the merger, which would give the combined company a share of nearly 40% in the iron ore market.