By JAMES KANTERPublished: April 1, 2009
BRUSSELS — The credit card company MasterCard has settled an antitrust case by agreeing to reduce fees that raise costs for retailers, European Union regulators said Wednesday. But MasterCard said that its measures were provisional, and that it would continue a broader battle over the level of the fees in court.
Competition Commissioner Neelie Kroes of the E.U. said the move by MasterCard could save money for retailers and consumers, particularly those shopping across European borders, and she underlined that the settlement was an element in a broad effort to encourage spending and give the economy a boost.
The agreement would “provide a fair share of the benefits to consumers and retailers,” she said. Ms. Kroes also warned Visa, another card company, it remained under investigation, and she said she would monitor the business practices of other payment card operators to ensure they also benefited retailers and consumers.
The European Commission ruled in December 2007 that MasterCard’s cross-border transaction fees broke European Union antitrust rules. That ruling could have led to steep fines on the company.
MasterCard appealed that decision to the European Court of First Instance, which still must make a determination on how it sets its so-called multilateral interchange fees.
The fees are paid between banks, but lobby groups for retailers have argued the levies inflate prices for shoppers.
Ms. Kroes said MasterCard had agreed cut its transaction fees to 0.3 percent for credit cards and 0.2 percent for debit cards. The company’s cross-border fees were significantly higher in 2007.
“We do not believe this level of interchange is adequate to sustain strong competition in the European payments industry,” Reuters reported MasterCard as saying Wednesday.
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