The European Commission’s decision on Visa’s interchange fees

The European Commission—acting as a European competition authority—cleared Visa’s European cross-border interchange fees on July 24, 2002, accepting undertakings given by Visa. Let me begin by making two preliminary remarks. In making a ruling based on competition law, the Commission did not “regulate” Visa’s interchange fees. Its role as an antitrust agency was to investigate alleged competition problems. Having done so, the Commission accepted undertakings devised and offered by Visa because it considered those undertakings sufficient to remove the competition concern. The initiative to find a remedy remained with the market. This also means that the solution found in the Visa case was not the only possible outcome. As a number of competition authorities within the European Union (EU) are currently investigating interchange fees and related issues, there is a need to ensure that the methodologies applied are coherent. But the facts and their assessment may differ from case to case and from market to market, and future decisions will have to take into account evolving market conditions and remain open to new arguments. I will limit myself to three points in summarizing the Commission’s findings: