Bloomberg citing two people familiar with the matter reported that European regulators told BHP Billiton Ltd that the company's push to change the way prices are set for iron ore is one of the issues that may jeopardize its USD 58 billion hostile offer for Rio Tinto Group.

As per these sources “The regulator expressed concern that the combined companies may be able to control supply and the development of reserves.”

The report added that BHP's attempt to link or index iron ore supply contracts to so called spot prices may hurt steelmakers

The report cited Mr Andrew Keen, an analyst at Sanford C Bernstein in London as saying that “If the commission objects to index pricing, BHP may have to decide whether it wants to do the deal or reform the iron-ore pricing system.”