Summary of Commission Decision

of 22 January 2019

relating to a proceeding under Article 101 of the Treaty on the Functioning of the European Union and Article 53 of the EEA Agreement

(AT.40049 — Mastercard II)

(notified under document C(2019) 241 final)

(Only the English text is authentic)

(Text with EEA relevance)

(2019/C 185/07)

On 22 January 2019, the Commission adopted a decision relating to a proceeding under Article 101 of the Treat on the Functioning of the European Union and Article 53 of the EEA agreement. In accordance with the provisions of Article 30 of Council Regulation (EC) No 1/2003 (1), the Commission herewith publishes the names of the parties and the main content of the decision, including any penalties imposed, having regard to the legitimate interest of undertakings in the protection of their business secrets.

1.   INTRODUCTION

(1)

The Decision is addressed to Mastercard Incorporated, Mastercard International Incorporated and Mastercard Europe SA (together referred to as ‘Mastercard’), which operate the Mastercard card payment scheme.

(2)

Mastercard Incorporated has its registered office in the State of Delaware (United States of America) and is the holding company of the fully owned subsidiaries Mastercard International Incorporated and Mastercard Europe SA. Mastercard International Incorporated is a membership corporation that has its offices in Wilmington, State of Delaware, United States of America. Its members are banks and payment service providers that are card acquirers or card issuers, or both. Mastercard Europe SA is a fully consolidated subsidiary of Mastercard Incorporated.

(3)

The Decision establishes that Mastercard’s cross-border acquiring rules constituted an infringement of Article 101 of the Treaty on the Functioning of the European Union (‘Treaty’) and Article 53 of the Agreement on the European Economic Area (‘EEA Agreement’).

2.   CASE DESCRIPTION

2.1.   Procedure

(4)

On 9 April 2013, the Commission opened proceedings against Mastercard.

(5)

On 9 July 2015, the Commission adopted a Statement of Objections to which Mastercard replied in writing on 21 April 2016. On 6 May 2016, Mastercard submitted an updated reply.

(6)

On 31 May 2016, an Oral Hearing took place during which Mastercard developed its arguments.

(7)

On 3 December 2018, Mastercard submitted a signed settlement submission acknowledging the infringement and its liability for the period covered by the Decision.

(8)

The Advisory Committee on Restrictive Practices and Dominant Positions issued a favourable opinion on 17 January 2019.

(9)

The Commission adopted the Decision on 22 January 2019.

2.2.   Addressees and duration

(10)

Mastercard Europe SA, Mastercard Incorporated and Mastercard International Incorporated have infringed Article 101 TFEU and Article 53 EEA Agreement by adopting decisions regulating the applicable Multilateral Interchange Fee (‘MIF’) in respect of cross-border acquiring in the card payments sector in the EEA.

(11)

Having regard to the Commission’s 2014 Visa Europe Decision (2) making binding commitments on Visa Europe, the Commission finds an infringement in this case from 27 February 2014. The Commission finds that the last date of the infringement was 8 December 2015, as Mastercard’s amendment of its cross-border acquiring rules came into effect on 9 December 2015. Therefore, the period covered by the present Decision is from 27 February 2014 to 8 December 2015.

2.3.   Summary of the infringement

(12)

Mastercard maintained a set of cross-border acquiring rules, which created an obstacle to cross-border trade in acquiring services within the EEA. Cross-border acquiring takes place when the acquiring bank (‘the acquirer’) is located in a different country than the merchant. According to Mastercard rules, a card payment transaction that has been cleared and settled gives rise to an ‘interchange fee’ to be paid by the acquirer to the cardholder’s bank (‘the issuer’). Mastercard rules stipulated that, unless the acquirer had agreed bilaterally with the issuer on the interchange fee, a cross-border acquirer was obliged to apply a domestic MIF applicable at the country of the merchants.

(13)

Mastercard’s cross-border acquiring rules meant that acquirers offering services in Member States where the domestic MIF were lower were prevented from offering cheaper services based on the MIFs in their ‘home’ countries to merchants based in Member States where the domestic MIFs were higher. The merchants were also prevented from taking advantage of the internal market and benefiting from less expensive services from card acquirers established in Member States where MIF were lower. Therefore, Mastercard’s cross-border acquiring rules created an obstacle to cross-border trade in the market for acquiring card payment transactions within the EEA.

(14)

Mastercard and its members constituted an association of undertakings and its decisions with respect to the cross-border acquiring rules amounted to decisions by an association of undertakings within the meaning of Article 101(1) of the Treaty and Article 53(1) of the EEA Agreement.

2.4.   Remedies

(15)

The Decision applies the 2006 Guidelines on Fines (3).

2.4.1.   Basic amount of the fine

(16)

In setting the fines, the Commission took into account the value of sales of Mastercard’s acquiring members, since Mastercard remained a standing body of an association of undertakings and the infringement relates to the activities of its acquiring members. As the infringement lasted from 27 February 2014 to 8 December 2015, the Commission took into account the turnover generated during the period of the infringement (‘the actual sales’), to create a representative full business year.

(17)

The Commission took into account the fact that the cross-border acquiring rules were a result of a decision by an association of undertakings, restricted cross-border trade, hindered the achievement of the internal market, covered the entire EEA and constituted a serious infringement of Article 101 of the Treaty. Taking account these factors and the market position of Mastercard, the proportion of the values of sales taken into account was set at 11 %.

(18)

The Commission took into account the duration of the infringement, as mentioned above (see paragraph (11)).

2.4.2.   Adjustments to the basic amount

(19)

The Commission applied an aggravating circumstance and increased the basic amount of the fine by 50 % to take account of Mastercard’s recidivism. This is because on 19 December 2007, the Commission adopted a prohibition decision under Article 7 of Regulation (EC) No 1/2003 addressed to Mastercard finding that intra-regional MIFs infringed Article 101 of the Treaty. The decision was upheld by the Union Courts.

2.4.3.   Application of the 10 % turnover limit

(20)

The fine does not exceed 10 % of the sum of the total turnover of Mastercard’s acquiring members active in the EEA.

2.4.4.   Reduction for cooperation

(21)

The Commission concluded that, in order to reflect that Mastercard has effectively cooperated with the Commission beyond its legal obligation to do so, the fine that would otherwise have been imposed should, pursuant to point 37 of the Guidelines on Fines, be reduced by 10 %.

3.   CONCLUSION

(22)

In light of the above, the final amount of the fine imposed on Mastercard pursuant to Article 23(2) of Regulation (EC) No 1/2003 amounts to EUR 570 566 000.

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(1)  OJ L 1, 4.1.2003, p. 1.

(2)  Commission Decision of 26 February 2014 in case COMP/39.398 — Visa MIF (OJ C 79, 12.3.2011, p. 8).

(3)  OJ C 210, 1.9.2006, p. 2.