|Author (Person)||Frost, Laurence|
|Series Title||European Voice|
|Series Details||Vol.8, No.20, 23.5.02, p16|
BANK card giant Visa International is costing shops and customers as much as €600 million per year in 'anti-competitive' payment fees, according to EU retailers.
The warning comes as high-profile names, including supermarket chain Tesco, backed a last-ditch bid to prevent anti-trust officials from dropping an investigation into the 'interchange fees' levied on cross-border Visa purchases.
'Consumers are being ripped off,' said Xavier Durieu, secretary-general of EuroCommerce, which represents five million retailers and wholesalers from corner shops to superstores.
Visa's opponents are appealing to governments to intervene after it emerged that the European Commission plans to accept pledges from Visa to reduce its charges by 20 over five years, ending the probe launched in 1997. The retailers insist the charges, agreed between the 21,000 banks that own and operate Visa, break article 81 of the EU Treaty on anti-competitive agreements and cost shops and their customers €600 million a year.
'At a time when inflation is not going in the right direction someone should think twice about exempting all of these arrangements [from competition rules],' said Durieu. An advisory committee of member states' experts will consider Competition Commissioner Mario Monti's plans to accept Visa's pledges.
Although the committee's decisions are not binding, retailers are optimistic it will use its influence to modify the Commission's position, pointing to investigations or litigation under way against Visa in eight EU countries as a sign of governments' unease. Although the case only concerns cross-border purchases, its outcome could set an important precedent for Visa's national payment regimes.
The concessions offered by Visa include a 20 reduction of the fees over five years, a h0.28 flat rate on debit card transactions - representing a cut of over 50 - and more transparency in the transaction costs covered by the interchange fee.
But retailers want to opt out of some of the costs - for example by buying payment guarantees more cheaply on the insurance market - and say they may consider legal action if the Commission goes ahead with Monti's proposal.
'Obviously it's an option we will be considering,' said a spokeswoman for retail giant Tesco, one of EuroCommerce's largest members. 'We want the single market philosophy applied to this case - this draft decision would do nothing for competition or for consumers.'
Bank card giant Visa International is costing shops and customers as much as €600 million per year in 'anti-competitive' payment fees, according to EU retailers.
|Subject Categories||Internal Markets|