Mastercard and Visa commitments on MIFs made legally binding by the European Commission


On 29 April, the European Commission accepted and made legally binding the commitments proposed separately by Mastercard and Visa to reduce their multilateral interchange fees (MIFs) on payments made in the European Economic Area (EEA) using consumer cards issued outside the EEA. The Commission claimed these commitments will reduce the MIFs paid by merchants by an average of 40%. They will come into full effect within 6 months and last for a period of 5 years and 6 months, and will require the card schemes to publish all inter-regional MIFs covered by the agreement on their websites as well as refrain from circumventing the caps “by any measure equivalent in object or effect”.

The Commission outlined its competition concerns related to inter-regional MIFs in a   Statement of Objections addressed to Mastercard    on 9 July 2015 and a   Supplementary Statement of Objections addressed to Visa    on 3 August 2017. In particular, the Commission was concerned that inter-regional MIFs may anti-competitively increase prices for European retailers accepting payments from cards issued outside the EEA and in turn lead to higher prices for consumer goods and services in the EEA.

Both Mastercard and Visa have now committed to reduce their respective inter-regional MIFs. These commitments, which will cut the inter-regional MIFs, are expected to reduce the costs for retailers in the EEA when they accept payments made with cards issued outside the EEA. This would lead to lower prices and consequently benefit European consumers.

Under their commitments, each of Mastercard and Visa undertake to:

  • reduce the current level of inter-regional interchange fees to or below certain binding caps within 6 months,
  • For card payments carried out by the cardholder in a shop (“Card Present Transactions”):

0.2% of the value of the transaction for debit cards;

0.3% of the value of the transaction for credit cards.

  • For online payments (“Card Not Present Transactions”):

1.15% of the value of the transaction for debit cards;

1.50% of the value of the transaction for credit cards.

  • refrain from circumventing these caps by any measure equivalent in object or effect to inter-regional MIFs and;
  • publish all inter-regional interchange fees covered by the commitments in a clearly visible manner on their respective websites.

More information, including the full version of the commitments, is available in the Commission’s   press release, in the public case register under the case numbers   AT  39398  (Visa) and   AT 40049    (Mastercard).