Europe is heading for a showdown with the US in an attempt to force the Securities and Exchange Commission to allow European stock exchanges access to its financial markets.

The European Commission and regulators are pressing the issue now because of top management changes due at the SEC, following Arthur Levitt's retirement and George W Bush's election as US President. The row over anti-competitive behaviour has already made it onto President Bush's agenda and there are some signs that the SEC might be prepared to compromise.