International

Visa To Pay $18M For Anti-Competitive Conduct

Some methods of competition have landed Visa in hot water in Australia.

In proceedings brought by the Australian Competition and Consumer Commission (ACCC), the Federal Court of that country has ordered Visa Worldwide to pay a penalty of $18 million for engaging in anti-competitive conduct.

According to the ruling, from May 1, 2010, to Oct. 6, 2010, Visa Worldwide implemented and maintained an altered rule set that limited the availability of Dynamic Currency Conversion (DCC) services — which compete with Visa’s currency conversion services and give international cardholders a choice to complete a transaction in their home currency rather than in the merchant’s local currency — on POS transactions in Australia. As a result of Visa’s prohibition of DCC services, retail stores, hotels and restaurants that were not already offering them to their customers as of April 30, 2010, could not choose to do so — effectively freezing out these merchants and preventing the further expansion of DCC during the period in question.

The court indicated that the penalty should stand as a message to large multinational corporations that operate in Australia, letting them know that the country — regardless of the policies of other regions — will not tolerate conduct that violates competition laws.

“Unlawful conduct which prevents or hinders the competitive process in concentrated industries and restricts consumer choice are priority areas for the ACCC,” ACCC Chairman Rod Sims said in a statement. “The ACCC was concerned that Visa’s conduct was likely to stop the growth of currency conversion services which competed with its own and, as a result, limit the choices available to consumers.”

Added Sims: “The substantial penalty imposed against Visa Worldwide reflects the serious nature of the conduct, which hindered the competitive process and restricted an emerging technology and service from developing under otherwise competitive market conditions.”

In addition to the $18 million fine, the Federal Court of Australia ordered Visa to pay the ACCC’s $2 million in costs for the proceeding.

To check out what else is HOT in the world of payments, click here.

——————————

LATEST PYMNTS REPORT: B2B API TRACKER 

Social distancing has changed eCommerce from a ‘want to have’ to a ‘must have’ for businesses, yet retailers could struggle to create convenient payment and refund experiences for their apps and websites, says Abdul Raof Latiff, head of DBS Bank’s digital institutional banking group. In the April 2020 B2B API Tracker, Latiff explains how banks can provide a timely assist via application programming interfaces (APIs) that integrate payments into those eCommerce platforms.

Click to comment

TRENDING RIGHT NOW