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EU launches probe into Boeing-Embraer commercial plane JV

The European Commission opened an investigation into Boeing Co.'s proposed tie-up with Brazil's Embraer SA involving commercial airplanes, citing concerns over competition and higher prices.

The two companies agreed in July 2018 to form a joint venture giving Boeing an 80% stake and allowing it to take over Embraer's global commercial aircraft business. They also agreed on another partnership involving Embraer's KC-390 military aircraft.

The EC raised concerns that the deal could dislodge Embraer as the third-largest player in the commercial aircraft industry and eliminate the company from the single-aisle plane market.

"Potential entrants from China, Japan and Russia seem to face high barriers to entry and expansion and may be unable to replicate within the next five or even 10 years the competitive constraint currently exerted by Embraer," the regulator said in a press release.

The EC said it has until Feb. 20, 2020, to decide on the proposed transaction.

Earlier this week, Boeing pushed back its expected date for the deal's closing to early 2020 from the end of 2019 due to the probe. The company said it will help with the investigation.