BRUSSELS--European Union regulators Wednesday accepted an offer
from Visa Europe to cap its interbank fees to the same level as
MasterCard Inc.'s to settle an antitrust probe.
Europe's largest card payments company will cut the fees it
charges retailers to 0.3% of the value of each transaction, a
reduction of between 40% and 60%, the European Commission said.
Rival MasterCard Inc. agreed to cap fees at that same level in
2009.
Visa Europe made the offer last year to cut the so-called
Multilateral Interchange Fees, which are paid by retailers' banks
to cardholders' banks and are fixed jointly by the retailers'
banks.
Visa Europe is owned and operated by more than 3,000 European
financial institutions and has a 40% market share in the credit and
debit card market in Europe. More than 5 million merchants accept
its cards.
The commitments "are excellent news for European consumers,
since the fees paid by retailers end up on their bills," said the
EU's antitrust chief, Joaquín Almunia.
Visa Europe said the agreement would provide "legal certainty"
and would enable the company to "focus on developing and providing
payment solutions for the benefit of consumers, rather than
pursuing lengthy legal cases."
As part of its agreement with the commission, the firm agreed to
reduce interbank fees for cross-border transactions to 0.3% for
credit and 0.2% for debit transactions. It will also simplify its
interbank fee structure and make the invoicing of card acceptance
services more transparent to merchants.
The commitments are legally binding on Visa for four years and
come nearly five years after the EU's antitrust watchdog filed a
formal complaint against the company.
Visa Europe has undertaken to observe the proposed commitments
for four years.
The European Commission said it is continuing proceedings
against Visa Inc. in relation to its international interbank fees,
which are fees that apply when a cardholder from outside the Visa
Europe territory, such as the U.S., uses a Visa credit card to make
a purchase in Europe.
Even though they share a brand, Visa Inc. and Visa Europe are
separate entities that run their own clearance systems. The
European firm is owned by financial institutions and operates as a
licensee of New York-listed Visa Inc. Visa Europe is a minority
stockholder in Visa Inc., and the U.S. company receives royalties
from Europe.
MasterCard was told by European regulators to cap its fees in
2007 on the grounds that they were too high and flouted competition
rules. MasterCard subsequently challenged that decision, which was
upheld by the EU's General Court, the bloc's second highest court,
in 2012.
Marcin Sobczyk, Andrew R. Johnson and Dana Cimilluca contributed
to this article.
Write to Vanessa Mock at vanessa.mock@wsj.com
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