European Commission competition regulators have opened an investigation into Thomson Reuters, the financial data provider, amid concerns that it is breaking monopoly abuse rules by locking customers into its services.

The Commission said that its antitrust division was to examine whether Thomson Reuters was abusing its dominant market position by making it difficult for customers to use their own or other software to translate the Reuters’ codes for use elsewhere.

The investigation centres on real-time market datafeeds on trading prices that Thomson Reuters supplies to banks' internal computer systems. These feeds use codes, known as Reuters Instrument Codes, to identify securities and where they are traded.

Jonathan Todd, a spokesman for the European Commission, said the Commission's concern was that Thomson Reuters customers were unable to use alternative market datafeeds alongside the company's service because of the restrictions it put on its codes.

“There are three actual and potential competitors for Thomson Reuters in this area and none of them have this restriction,” he told a news conference.

Banks face “a long and costly procedure” to replace the Reuters codes by reconfiguring or rewriting their own software, regulators said.

Thomson Reuters was formed last year by the merger of Thomson Corporation and Reuters Group.

Mr Todd said that EU officials identified the potential antitrust abuse when they looked at the takeover last year. They did not act then because it was not relevant to the merger review, which examined only how a newer, larger firm would affect competition.

The EU was making the case a priority, he added.

Thomson Reuters confirmed that it had received a questionnaire from the European Commission last week relating to the use of Reuters Instrument Code. It said in a statement that it would “fully co-operate” with the investigation.

ACTIV Financial, a data feed provider and a competitor of Thomson Reuters, said that it was continually coming up against Thomson Reuters in bidding for clients. Lacking the Reuters codes put them at a competitive disadvantage.

Shawn Kaplan of ACTIV Financial, a competitor to Thomson Reuters, said: "Unless you have data that can be referenced by the Reuters codes you are at an absolute competitive disadvantage as they have become the industry standard.

"I'm not 100 per cent certain they should be made to give away their code, but they should licence it to clients and other users. At present only a small handful of firms have the right to utilise the Reuters codes for reference to other data," he said.

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