E-marketplaces under scrutiny

The European Commission (EC) is examining what impact electronic business-to-business (B2B) marketplaces have on the competitiveness of open markets.

B2B exchanges promise business savings by combining the purchasing power of their members. However, Europe's anti-monopoly watchers have expressed fears that industry giants may be using such exchanges to create price-fixing cartels.

Earlier this month the EC's Competition Commissioner Mario Monti made the first ruling on a B2B exchange, giving the green light to emaro, a joint venture between Deutsche Bank and enterprise resource planning software vendor SAP to create a platform for suppliers of office equipment. The commission ruled that there were no competition concerns "as the activities of the two parent companies did not overlap in the relevant markets".

It is now examining MyAircraft.com, a joint venture set up by United Technologies, Honeywell International and i2 technologies to sell aircraft components. The trio boasted combined revenues of $48.4bn in 1999 - $47.8bn from United Technolgies and Honeywell alone.

United Technologies counts Sikorsky helicopters, Pratt & Whitney aircraft engines and space propulsion systems among its product lines, and employs close to 150,000 staff worldwide. Honeywell supplies software to the aircraft industry, among others, while i2 provides ebusiness systems.

The EC is currently conducting a preliminary investigation which it will complete by 7 August before deciding whether to launch a four-month probe into the joint venture or give it the go-ahead.

An EC spokeswoman said internet businesses were subject to the same tests as any other and no special tests applied in this case.