America's anti-trust regulators have given partial approval to BHP Billiton's $38 billion (£19.1 billion) offer for Rio Tinto but the deal is still awaiting the opinion of the European Commission, expected to prove a tougher hurdle.

Shares in the competing Australian mining giants dipped in trading in Australia today despite BHP's announcement that it had received early termination of the Hart-Scott-Rodino waiting period by the US Department of Justice, part of the process of regulatory approval, without a request for further action. BHP said that termination of the waiting period satisfied part of the conditions of the bid for Rio launched in January.

The deal would create the world's largest mining conglomerate.

Protests from steelmakers from Europe to the Far East have dogged BHP since it first approached Rio with the proposal that the two companies merge. Both companies have big positions in iron ore in Australia and a takeover of Rio by BHP would give it a market share of some 40 per cent, leaving almost three quarters of the world seaborne iron ore trade in the hands of two companies: BHP-Rio and Vale of Brazil, the only sizeable competitor. Japanese and Chinese customers of the two Australian miners have been vociferous in their opposition to a combination.

The price of iron ore has surged due to Far Eastern demand for steel and Rio Tinto recently secured a doubling of its long-term contract terms with Asian millowners.

Reaction has been muted in the United States, which is largely self-sufficient in iron ore and also has access to significant resources in neighbouring Canada. However, Europe's steel industry has made its oppostion felt with an early protest to the European Commission regarding BHP's proposal by Eurofer, the EU steel lobby group which called on the Commission to block the merger. The Chinese Iron and Steel Association described the merger proposal as "an even bigger monopoly".

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