EU marks Visa's cards for anti-trust probe
Formal proceedings launched
The European Commission is opening formal antitrust proceedings against Visa Europe Limited in connection to how much it charges for cross-border transactions.
Visa International was investigated by the Commission over multilateral interchange fees(MIF) in 2002 and exempted when Visa offered to reduce fees from 1.1 per cent to 0.7 per cent. The fee is paid to the consumer's bank by the merchant's bank. Banks typically pass this transaction charge onto shops and merchants.
This agreement ended 31 December 2007 and the fees are now the responsibility of Visa Europe Limited.
Visa Europe Limited said the announcement was a "standard procedural step".
The company said: "We see no evidence that Visa Europe’s interchange has acted as a tax on consumption or has caused consumers to pay twice. The net result of a substantial reduction in interchange would see a disproportionate shift in the costs of the card payments system from retailers to consumers."
The Commission is also investigating the "Honour-All-Cards-Rule". The statement notes that starting proceedings is not proof of wrongdoing.
The UK's Office of Fair Trading made similar complaints against credit card companies in 2005.
The Commission statement is here.®