EGC rejects MasterCard appeal on interchange fees–is Visa next?

The EU General Court has rejected MasterCard’s appeal of the European Commission’s 2007 decision to ban its cross-border multilateral interchange fees (MIF). The European Commission had found that MIF violate EC Treaty rules on restrictive business practices (Article 81), writing in the press release accompanying the decision that interchange fees “inflated the cost of card acceptance by retailers without leading to proven efficiencies.” The General Court agreed: “The methods of setting the MIF tended to overestimate the costs borne by the financial institutions on issuing payment cards and, moreover, inadequately to assess the advantages which merchants derive from that form of payment” (as quoted in Reuters).

Although this decision applies directly to MasterCard, the European Commission will likely set its sights on Visa Europe next. According to Reuters, Joaquín Almunia was readying formal charges against the credit card company in January.

Full content: Reuters

Related content: The Drama of Interchange Fees (Vitor Bento, Portuguese Council of State)

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