Case C‑228/18

Gazdasági Versenyhivatal

v

Budapest Bank Nyrt. and Others

(request for a preliminary ruling from the Kúria)

Judgment of the Court (Fifth Chamber), 2 April 2020

(Reference for a preliminary ruling — Competition — Agreements, decisions and concerted practices — Article 101(1) TFEU — Card payment systems — Interbank agreement fixing the level of interchange fees — Agreement restricting competition ‘by object’ and ‘by effect’ — Concept of restriction of competition ‘by object’)

1. Questions referred for a preliminary ruling — Jurisdiction of the Court — Limits — General or hypothetical questions — Determination by the Court of its own jurisdiction

   (Arts 101(1) and 267 TFEU)

   (see paragraphs 29-31)

2. Agreements, decisions and concerted practices — Adverse effect on competition — Criteria for assessment — Anticompetitive object — Finding to that effect sufficient — Examination of effects — Permissibility

   (Art. 101(1) TFEU)

   (see paragraphs 39-44)

3. Agreements, decisions and concerted practices — Adverse effect on competition — Criteria for assessment — Distinction between restrictions by object and by effect — Restriction by object — Sufficient degree of harm — Assessment

   (Art. 101(1) TFEU)

   (see paragraphs 59, 69, 75, 78, 79, 82, 83)

4. Agreements, decisions and concerted practices — Adverse effect on competition — Interbank agreement standardising the level of interchange fees payable on card payment transactions — Anticompetitive object — Criteria for assessment — Individual and specific examination, by the national court, of the wording and objective of agreements and the economic and legal context

   (Art. 101(1) TFEU)

   (see paragraphs 60-65, 69-86)

5. Agreements, decisions and concerted practices — Prohibition — Infringements — Price fixing — Concept — Interbank agreement standardising the level of interchange fees payable on card payment transactions — Multiple objectives — Effect

   (Art. 101(1) TFEU)

   (see paragraphs 69-86)

Résumé

In the judgment in Budapest Bank and Others (C‑228/18), delivered on 2 April 2020, the Court specified the criteria applicable in determining whether agreements concluded between financial institutions regarding the fees charged in respect of card payment transactions are practices or agreements having as their object the restriction of competition which are prohibited by Article 101 TFEU.

The Kúria (Supreme Court, Hungary) made a request for a preliminary ruling to the Court in a dispute between the Gazdasági Versenyhivatal (Competition Authority, Hungary) and (i) two providers of card payment services, Visa and MasterCard, and (ii) six credit institutions concerning a decision adopted in 2009 by the Competition Authority. By that decision, the Competition Authority found, inter alia, that there was an anticompetitive agreement concerning ‘interchange’ fees and, therefore, imposed fines of various amounts on seven of the financial institutions parties to the agreement and on Visa and MasterCard.

According to the information presented by the national court, interchange fees are amounts payable by the financial institutions providing economic operators with payment terminals (‘the acquiring banks’) to the financial institutions issuing the payment cards (‘the issuing banks’), as members of the payment system offered by Visa or MasterCard, when a card payment transaction takes place. In April 1996, seven financial institutions representing a large part of the relevant national markets agreed to determine, for each category of operator, the minimum level of the service charge payable by operators. In October 1996, a second agreement (‘the MIF Agreement’) was adopted; that agreement was negotiated on behalf of Visa and MasterCard and sought to introduce a uniform amount for the interchange fees payable under those two payment systems. After examining the MIF Agreement, the Competition Authority found, in respect of the period beginning on the date of Hungary’s accession to the European Union, that there was an infringement of Article 101 TFEU by all the financial institutions which successively joined up to the MIF Agreement and by Visa and MasterCard. In the Competition Authority’s view, determining a uniform level and structure for the applicable interchange fee and, in the case of Visa and MasterCard, establishing a framework for that purpose in their respective internal rules constituted an agreement caught by the prohibition under Article 101 TFEU in that it not only had the object of restricting competition but, moreover, had a restrictive effect on competition.

The Court held, first, that Article 101(1) TFEU does not preclude anticompetitive conduct from being regarded as having as both its object and its effect the restriction of competition, within the meaning of that provision. Having been asked to clarify the relationship between those two categories of restrictions of competition, the Court recalled that coordination between undertakings involves a restriction of competition ‘by object’ where it reveals, in itself, a sufficient degree of harm, without there being any need to examine its effects on competition. However, where the same conduct is regarded as having both as its object and its effect the restriction of competition, it is incumbent on the competent authority or the court having jurisdiction to support its findings for that purpose with the necessary evidence and to specify to what extent that evidence relates to each type of restriction thus found to exist.

Next, the Court addressed the question of the classification that might be given to the agreement at issue in the light of Article 101(1) TFEU, having observed at the outset that the final assessment in that regard fell to the national court.

The Court stated, first of all, in the light of the content of the MIF Agreement, that that agreement had established a uniform amount for the interchange fees payable by the acquiring banks to the issuing banks in respect of payment transactions made using a card of one of the payment systems, thus affecting one aspect of competition both between the two payment systems under consideration and between the acquiring banks. The Court observed that, although the agreement at issue did not directly determine the service charges, a restriction ‘by object’ could nevertheless be acknowledged if such an agreement were to be viewed as indirect price fixing for the purposes of Article 101(1)(a) TFEU or as conduct presenting equivalent harm to competition within the internal market.

Having, however, found that the harm required for the purposes of classification as a restriction ‘by object’ was not necessarily apparent from the information submitted to the Court as regards the content of the agreement, the Court examined the information at its disposal concerning the objectives pursued by the MIF Agreement. In the light of that information, the Court found that it could not be ruled out that the objective pursued by the MIF Agreement consisted not in guaranteeing a minimum threshold for charges but in establishing a degree of balance between the ‘issuing’ and ‘acquiring’ activities within each of the card payment systems concerned in the case in point. In that regard, the Court considered it relevant that the parties to the agreement included both issuing banks and acquiring banks. If it were to become apparent from the verifications to be carried out in that regard by the national court that, by neutralising competition between the two card payment systems concerned with regard to the interchange fees, the MIF Agreement had the effect of intensifying competition as regards other features of those systems, this would require, in the Court’s view, that an assessment be conducted of the competition which would have existed on the market under consideration if the MIF Agreement had not been concluded and, therefore, an analysis of the effects of that agreement.

Accordingly, the Court took the view that it had not been provided with sufficient information to enable it to establish whether the neutralisation of competition with regard to the interchange fees revealed, in itself, a sufficient degree of harm on the part of the MIF Agreement so as not to require an examination of its effects, both as regards competition between the two card payment systems and as regards competition on the acquiring market. The Court observed that a limitation, by the MIF Agreement, of the upwards pressure on interchange fees which would have occurred in the absence of an agreement was nevertheless relevant for the purposes of examining the existence of a restriction resulting from that agreement.

The Court thus held that Article 101(1) TFEU must be interpreted as meaning that an interbank agreement which fixes at the same amount the interchange fee payable, where a payment transaction by card takes place, to the banks issuing the card cannot be classified as an agreement which has ‘as [its] object’ the prevention, restriction or distortion of competition, within the meaning of that provision, unless that agreement, in the light of its wording, its objectives and its context, can be regarded as posing a sufficient degree of harm to competition to be classified thus, a matter which was for the referring court to determine.