AUSTRALIA'S competition regulator is ready to make a call on the USD 116 billion iron ore joint venture between BHP Billiton and Rio Tinto if its overseas counterparts give the proposal the green light.

Analysts have expressed extreme doubt that the production joint venture would clear regulatory hurdles, particularly those of the European Union, which is considered to be the toughest task.

Last month the Australian Competition and Consumer Commission agreed to a request from BHP and Rio to push back a decision on the proposal to give it the best chance of satisfying any overseas regulatory concerns.

Mr Graeme Samuel commission chairman said that the regulator had completed most of its work on the proposal but would hold off on making a decision under the previously announced agreement.

He said that ''We have done the bulk of our investigation. We have been asked not to make a final decision until such time as the parties have had a chance to deal with other regulators around the world and we have agreed to do just that.''

In a speech to the Merger Market's event in Sydney last night, Mr Samuel recalled the review the commission did in 2008 on the failed BHP-Rio merger, under section 50 of the Trade Practices Act. He said the ACCC is 'focusing on whether market forces have changed since that time'.

He said that ''I might note that this review is not a typical section 50 review, but rather an assessment of whether the joint venture would constitute a contract, arrangement or understanding that would fall for consideration under section 45 of the act. The same 'substantial lessening of competition' test applies, even though this isn't a merger as such.''

(Sourced from Sydney Morning Herald)