Mastercard incurred a US$650 million fourth-quarter charge related to a large fine over a 2015 EU antitrust investigation, Reuters reported on Tuesday, December 4.
The company was accused of setting rules that blocked banks in one EU country from offering lower interchange fees to a retailer in another EU country. Mastercard actually stopped the practice in December of 2015 after the European Commission (EC) adopted charge-capping rules.
Mastercard, along with Visa, has offered to put a cap on the fees applied to card payments by tourists in the EU, to put an end to the antitrust investigation.
The EC has long fought with the companies over fees. The Commission claimed that interchange fees–which the merchant’s bank pays to the cardholder’s bank – raise prices for customers, as the fee is actually passed onto the merchant.
Mastercard and Visa have proposed a 0.2% fee on non-EU debit card payments done in shops, and a 0.3% fee on credit card payments. This would bring them down to the level of EU cards.
Some consumer groups, like The European Consumer Organisation (BEUC) urged merchants to pass savings onto consumers. Before the EC decides whether it’s going to accept the offer, third parties have a month to provide feedback.
“The Commission invites all stakeholders to submit their views on the commitments within one month of their publication in the EU’s Official Journal,” the EC stated in a release. “Taking into account all comments received, the Commission will then take a final view on whether the commitments address its competition concerns.”
When asked for comment, Commission Spokesman Ricardo Cardoso neglected to provide solid information about the case. “The case is still ongoing and we cannot comment further on it,” he said.