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05 February 2019 / news

BankBit: Banks suspected of European government bonds cartel

The European Commission (the Commission) informed eight banks of its preliminary view that they infringed the cartel prohibition when acquiring and trading European government bonds (EGBs).

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A month ago, the Commission already announced that it suspected four banks of infringing the cartel prohibition in a similar manner in relation to their conduct on the market for US dollar denominated supra-sovereign, sovereign and agency bonds (SSA bonds) (see our earlier BankBit).

From the Commission’s press release (link) in relation to the EGBs cartel it appears that, as in the SSA bonds case and other recent cartel cases in the financial sector, it suspects that traders exchanged commercially sensitive information and coordinated trading strategies. Also in this instance, online chatrooms were mainly used for such purposes.

EGBs are Euro denominated sovereign bonds issued by the central governments of Eurozone member states. The Commission stresses that its investigation of eight banks, that covers different periods between 2007 and 2012, does not imply that the alleged conduct was a general practice in the market.

An interesting difference with the SSA bonds case is that the EGBs investigation concerns anticompetitive conduct in relation to the acquisition and trading of bonds (i.e. primary and secondary market) while the SSA bonds investigation focuses on the secondary market only.

Loyens & Loeff has an integrated banking, competition and litigation team that is well equipped to advice on any issues in relation to the above, from compliance to dawn raid assistance and defence side litigation.

More info? Contact your regular Loyens & Loeff adviser or FIT@loyensloeff.com /+31 20 578 50 69

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