BRUSSELS, Sept 23 (Reuters) - Hyundai Heavy Industries Holdings Co Ltd, the world's largest shipbuilder, is talking with EU antitrust regulators about concessions to allay concerns about its $1.8 billion bid for rival Daewoo , people familiar with the matter said.

The deal, in part a response to overcapacity in the sector, would reinforce the South Korean company's top position with a 21% market share and comes as rivals in China and Singapore make inroads.

The European Commission, which opened a full-scale investigation into the deal last December on concerns it could inflate prices and reduce competition in cargo shipbuilding, declined to comment.

Hyundai was not immediately available for comment while Daewoo declined to comment.

It is not clear what concessions the companies will offer. EU regulators typically favour asset sales or transfer of technologies or contracts to rivals to address competition concerns.

The Commission temporarily halted its probe on July 13, the third time it has done so. The previous two delays were due to the coronavirus crisis and also while waiting for the companies to provide data.

Much of the EU's internal and external freight trade goes by sea, with European shipping companies major customers of Hyundai and Daewoo. (Reporting by Foo Yun Chee, additional reporting by Heekyong Yang in Seoul; editing by Jason Neely)