RPT-UPDATE 3-EU opens probe into Thomson Reuters coding tool

* EU says probe doesn't imply proof of antitrust violation

* EU says probe launched on its own initiative

* Thomson Reuters says cooperating with EC

* EU says competitors do not have similar restriction

* Shares close down less than 1 pct (Adds analyst's note, background on S&P, CUSIP, changes dateline, previous BRUSSELS)

By Foo Yun Chee and Robert MacMillan

BRUSSELS/NEW YORK, Nov 10 (Reuters) - EU antitrust regulators launched an investigation on Tuesday into how Thomson Reuters (TRI.TO)(TRI.N) codes its financial market data feeds, saying it might discourage customers from moving to rival firms.

The European Commission, which polices competition in the 27-country European Union, said it had launched the investigation on its own initiative and it did not imply that it had proof that Thomson Reuters had broken the law.

The Commission said it would examine whether Thomson Reuters could prevent clients from mapping Reuters Instrument Codes (RICs) to identification codes of other datafeed suppliers.

"Without the possibility of such mapping, customers may potentially be 'locked'-in to working with Thomson Reuters because replacing RICs by reconfiguring or by rewriting their software applications can be a long and costly procedure," the Commission said in a statement.

RICs, codes that identify financial instruments including shares in companies, currencies, and futures contracts, are used to retrieve information from Thomson Reuters' real-time datafeeds. The feeds are virtual pipelines of electronically distributed real-time market data that supply software applications developed by banks and financial institutions.

Thomson Reuters confirmed that it had received a questionnaire from the Commission on the use of RICs and that it was cooperating with the Commission.

"Thomson Reuters provides its customers with consistent, dependable and convenient access to several million financial instruments from almost every electronic trading venue around the world," the company said in a statement.

"Thomson Reuters data is reliably and consistently identified by a managed code, which we create and maintain to enable navigation of the company's global content."

The Commission's investigation likely will not result in findings against Thomson Reuters, Citi analyst Thomas Singlehurst wrote in a note to investors on Tuesday.

"It is not at all clear that there is a case to be investigated," Singlehurst wrote. "RICs are Reuters' own codification system. Technically it is their own (intellectual property) just as the Bloomberg codes are the property of Bloomberg)."

"This investigation comes just 18 months after the EU itself approved the merger of Thomson and Reuters and it seems strange that, if this was an issue, it wasn't raised at that stage," he wrote.

RESTRICTION

Jonathan Todd, a spokesman for the European Commission, told a news conference the Commission's concern was that Thomson Reuters customers were unable to use alternative market datafeeds alongside the company's service.

"There are three actual and potential competitors for Thomson Reuters in this area and none of them have this restriction," he said.

Thomson Reuters was formed last year by the merger of Thomson Corp and Reuters Group Plc. Its markets division competes with Bloomberg LP and News Corp's (NWSA.O) Dow Jones Newswires.

There is no strict deadline for the Commission to complete its investigation.

The Commission opened an investigation into credit ratings agency Standard & Poor's in January, saying it may have abused its monopoly position as the U.S. national numbering agency by forcing financial institutions in the European Union to pay licensing fees for using US ISIN codes in their own databases.

ISIN is a standard developed by the International Organisation for Standardisation (ISO) to provide cross-border identification for shares and bonds.

The investigation followed complaints from several associations representing investors, financial institutions and asset managers.

Earlier this year, Bloomberg started offering its identification codes for free on the Internet.

A Bloomberg spokeswoman declined to comment on the free codes website or on the Commission's investigation of Thomson Reuters. (Reporting by Foo Yun Chee in Brussels and Robert MacMillan in New York, editing by Timothy Heritage, Andrew Callus, Toni Reinhold)