The EU's antitrust probe into credit derivatives trading by 13 of the world's biggest banks stalled after the lenders' lawyers won the right to see confidential information compiled by investigators.
The banks asked to see business secrets about their rivals in EU files to help them fight a formal antitrust complaint sent in July, according to five people familiar with the probe who asked not to be identified because the process isn’t public. Meeting the requests may add about four months to the investigation, after the EU extended its deadline for responses to the so-called statement of objections.
The credit default swaps probe, which includes HSBC Holdings Plc, JPMorgan Chase & Co and Royal Bank of Scotland Group Plc, is one of two priority EU investigations into financial institutions. Almunia is poised to fine many of the same banks for rigging benchmarks including the London interbank offered rate in a scandal that’s tarnished the reputation of lenders seeking to recover from the biggest financial crisis since the Great Depression.
The Commission was required to grant access to potentially confidential data after lawyers in the CDS probe argued the information was vital given the complexity of the case, the people said. Such data would be evidence in the commission’s file, such as e-mails and other messages for which business secrecy was claimed.
After lengthy discussions, the EU agreed to distribute DVDs to lawyers with the sensitive data in exchange for pledges to protect the information. This process, known as a virtual data room, is used only in exceptional circumstances, according to EU guidelines.
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