Brussels
The European Commission Wednesday launched an anti-trust probe into
payment-card provider Visa Europe Ltd, to find whether it has been
setting unfair fees for international payments.
"The European Commission has decided to open formal antitrust
proceedings against Visa Europe Limited in relation to its
multilateral interchange fees (MIF) for cross-border point of sale
transactions," a commission statement said.
"This initiation of proceedings does not imply that the commission
has proof of an infringement. It only signifies that the commission
will conduct an in-depth investigation of the case as a matter of
priority," the statement said.
Visa's system of charging retailers' banks for accepting payments
made with Visa cards from another country was first challenged in
1997, when European retailers' association EuroCommerce complained
to the commission that its prices were unfairly high.
In 2002 Visa promised to revise its fee structure, reducing the cost
of such cross-border transactions and making the fees more
transparent. On those grounds, the commission decided to exempt
Visa's fee system from EU competition rules until the end of 2007.
In 2005-06, however, the commission ran an in-depth inquiry into the
workings of the retail-banking sector within the European Economic
Area (EEA - the European Union plus Iceland, Liechtenstein and
Norway).
That inquiry concluded that some MIF systems could be preventing the
development of an efficient international-payments system.
On the basis of the inquiry, on Dec 19, the commission prohibited
Mastercard's MIF system for cross-border payments within the EEA,
saying that it raised costs for retailers without improving
efficiency.
With the expiry of the exemption on Visa's MIF system, and the
experience gained from the 2005 inquiry, commission officials are
now free to examine whether Visa, too, breaches EU competition
rules.
There is no deadline for a decision, commission officials said.
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