November 25, 2010 / 12:48 PM / 7 years ago

UPDATE 1-EU set to accept Visa Europe antitrust offer - sources

 * Visa Europe to cut debit fee to 0.2 percent
 * Legally binding pledge valid for 4 years, effective Feb
 * EU expected to announce decision Dec. 8
 * EU scrutiny of consumer credit cards continues
   (Adds detail, background)
 By Foo Yun Chee
 BRUSSELS, Nov 25 (Reuters) - EU regulators will next month accept Visa Europe’s pledge to cut its debit card fees and drop antitrust charges that could have brought a fine to the payments network, two sources familiar with the case said on Thursday.
 The European Commission’s decision follows a market test on Visa Europe’s proposals in May. The EU watchdog had charged the credit and debit card network in 2009 for blocking competition with its debit fees. The Commission was expected to announce its decision on Dec. 8, one of the sources said.
 The 0.2 percent fee was set to come into effect in February and be legally binding for four years. It will apply for cross-border transactions and for domestic purchases in nine EU countries, including Ireland, Italy and Sweden.
 The European Union executive said in April the fee cuts would range from 30-60 percent. More than 70 percent of payment transactions through Visa Europe, the European licensee of Visa Inc. (V.N), are with debit cards.
 So-called interchange fees, where merchants pay fees to banks and processing networks like Visa and MasterCard Inc (MA.N) every time a customer uses a credit or debit card, are a significant source of revenue for the companies.
 Visa Europe is still facing EU regulatory scrutiny over its charges for consumer credit and deferred debit card transactions.
 MasterCard undertook to cut its transaction fees in April last year in return for the Commission scrapping its investigation, but has gone to court over the case.
 Visa and MasterCard settled a U.S. Justice Department antitrust lawsuit over their processing rules last month.  (Reporting by Foo Yun Chee; Editing by Rex Merrifield and Dan Lalor)  

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