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Antitrust: Commission sends Statement of Objections to Visa

European Commission - MEMO/09/151   06/04/2009

Other available languages: FR DE

MEMO/09/151

Brussels, 06 April 2009

Antitrust: Commission sends Statement of Objections to Visa

The European Commission can confirm that it has sent a Statement of Objections (SO) to Visa on 3rd April 2009. The Commission's preliminary view is that the multilateral interchange fees (MIFs) set directly by Visa restrict competition between banks for accepting consumer payment cards without benefiting consumers by contributing to technical and economic progress. The MIFs are an important part of the total cost that retailers must pay for accepting Visa's consumer payment cards, and in effect establish a minimum price for retailers. The Commission's preliminary view is that this behaviour infringes European antitrust rules (Article 81 EC Treaty and Article 53 EEA Treaty).

Following an investigation launched on its own initiative and the expiry of the Visa exemption decision of 2002 at the end of 2007, the Commission opened formal proceedings against Visa in March 2008 (see MEMO/08/170). The Statement of Objections contains a competition assessment of MIFs in mature payment card systems that is similar to the assessment in the MasterCard prohibition decision of December 2007 (see IP/07/1959).

The Statement of Objections concerns all multilateral interchange fees (MIFs) set directly by Visa in the EEA for point of sales transactions with consumer payment cards. These MIFs currently apply to all cross-border transactions in the EEA, as well as to domestic transactions in nine EU Member States (Belgium, Greece, Hungary, Ireland, Italy, Luxemburg, Malta, The Netherlands and Sweden). In the other Member States the Visa MIFs applying to domestic point of sale transactions are set domestically by groups of banks or bilaterally between banks. These inter-bank fees are paid by merchants' banks (acquiring banks) to cardholders' banks (issuing banks) for point of sale transactions with Visa's consumer payment cards.

The Statement of Objections outlines the Commission's preliminary view that Visa's MIFs harm competition between acquiring banks, inflate the cost of payment card acceptance for merchants and ultimately increase consumer prices.

MIFs are not illegal as such. However, a MIF in an open payment card scheme such as Visa's is only compatible with European antitrust rules if it contributes to technical and economic progress and benefits consumers.

The Statement of Objections also concerns other system rules and practices such as the "honour all cards rule", "no surcharge rule" and blending of merchants fees, in their capacity of hindering merchants' ability to manage their payment costs and thereby increasing the restrictive effects of the MIFs.

Visa's credit and debit cards represent approximately 36% of all payment cards issued in the EEA. Visa has the largest acceptance network within the EEA with over 5 million merchants accepting its payment cards. In 2006 a total of 27 billion card payments were made in the EEA, with a total value of €1600 billion.

The Commission has noted Visa's recent announcement on the new measures adopted with respect to its MIFs. These measures appear to address important problem areas: the adoption of a new methodology for setting of the intra-regional MIFs for consumer cards, a decrease of such MIFs, and the modification of certain transparency rules. In the Commission's view, these measures are a step in the right direction to improve the competition and transparency on the affected markets. However, the Commission considers that these modifications do not remove its concern that Visa's MIFs restrict competition. The Commission shall investigate the recently announced measures and will address them in the course of current proceedings.

Procedural background

A Statement of Objections is a formal step in Commission antitrust investigations in which the Commission informs the parties concerned in writing of the objections raised against them. The addressee of a Statement of Objections can reply in writing to the Statement of Objections, setting out all facts known to it which are relevant to its defence against the objections raised by the Commission. The party may also request an oral hearing to present its comments on the case.

The Commission may then take a decision on whether conduct addressed in the Statement of Objections is compatible or not with European antitrust rules. Sending a Statement of Objections does not prejudge the final outcome of the procedure.


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