In this issue:
The EC’s MasterCard Decision
Michael Katz
Comments on the European Commission’s MasterCard Decision
In December 2007, the European Commission issued its decision with respect to MasterCard’s policy of setting default values for Intra-EEA and Single Euro Payments Area (SEPA) interchange fees, which apply in the absence of bilateral agreements between issuers and acquirers.
John Wotton
The European Commission’s Decision in MasterCard: Issues Facing the Payment Card Industry for the Future
The Decision in MasterCard displays a fundamental divergence between the Commission’s and MasterCard’s approaches to the analysis of the competitive effects of open payment card schemes. MasterCard’s position is that MasterCard, together with its acquirers and issuers, provide payment card services simultaneously to cardholders and merchants.
Wilko Bolt
The European Commission’s Ruling in MasterCard: A Wise Decision?
Payment pricing and competitive efficiency have recently attracted a lot controversy. This has led to some spectacular antitrust litigation in the United States, Australia and now Europe.
Vitor Bento
The Drama of Interchange Fees
The main problem with the economics of card payments is that cash is used as its yardstick and cash payments, being the most socially inefficient means of payment, are made available at a price significantly below cost (often free of charge). To supply cash payments at a loss and in order to remain a profitable business, banks have to overcharge other services (cross-subsidization).
Appraisal of the EC’s White Paper
Assimakis Komninos, Apr 03, 2008
Enter the White Paper for Damages Actions: A First Selective Appraisal
On April 3, 2008, the European Commission published its long-awaited White Paper on Damages actions for breach of the EC antitrust rules (WP). The WP itself is a rather short document that summarizes the far more developed Staff Working Paper and an impressive 600-page Impact Assessment report.
Of Interest
Malcolm Coate, Jeffrey Fischer
Critical Loss: Not Implementing the Hypothetical Monopolist Test!
This comment responds to two recent papers on critical loss in this magazine. The first, by Gregory J. Werden, cautions against the standard application of CL analysis. The second, by Kevin Murphy and Robert Topel, concludes the CL concept is “so fundamentally flawed that it cannot be used as a tool of market definition.”
Heather Irvine
Crackdown on Cartels Highlights the Need for Competition Law Compliance in South Africa
The South African Competition Commission intensified its efforts to combat cartel activity in 2007, and a number of cases involving price-fixing and market division in key sectors of the South African economy were referred to the Competition Tribunal for adjudication.
GCP Authorities: Mexico
Ernesto Estrada Gonzalez
Competition Policy in Mexico
Competition policy in Mexico started in 1993 when the Federal Law of Economic Competition entered into force and the Federal Competition Commission (CFC) was created as the agency responsible for its enforcement. During its fourteen years of activity, the CFC has won key battles before the courts that have paved the path for an effective competition policy based on sound economic analysis and aimed at enhancing the efficient functioning of markets.
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