Visa, Mastercard Face Intensified EU Antitrust Scrutiny Over Fee Structures

The European Commission expands its antitrust investigation into Visa and Mastercard, focusing on their fee structures and potential market dominance.(Reuters)

Introduction

The European Commission has intensified its antitrust investigation into global payment giants Visa and Mastercard. This probe centers on concerns about their fee structures and potential abuse of market dominance within the European Economic Area. Given that these companies process approximately two-thirds of card payments in the eurozone, the outcomes of this investigation could have significant implications for global commerce and U.S. stakeholders.(Reuters)

Background of the Investigation

Initiated in September 2024, the European Commission’s investigation was prompted by complaints from merchants and payment service providers regarding the scheme fees imposed by Visa and Mastercard. These fees are charges for participating in their card payment systems. The Commission is examining whether these fees, and the manner in which they are implemented, violate EU competition laws.(Reuters, Reuters)

Details of the EU’s Expanded Probe

In a recent development, EU regulators have broadened the scope of their investigation by distributing detailed questionnaires to terminal providers and payment companies. These questionnaires seek information on:(Reuters)

The number and nature of fees or services charged by Visa and Mastercard between 2017 and 2024.
The introduction of new fees or services and changes to existing ones.
The mandatory nature of certain scheme and processing services.
The clarity and transparency of information provided about fees and services.
The adequacy of notice given regarding changes to fees and services.
Any complaints lodged against Visa and Mastercard in the past seven years and the duration taken to address these grievances.(Reuters)

Implications for U.S. Stakeholders

The outcomes of this investigation are not confined to Europe; they hold considerable significance for U.S. stakeholders, including investors, merchants, and consumers. If the European Commission finds that Visa and Mastercard have abused their market positions, it could lead to substantial fines and necessitate changes in their fee structures. Such changes could impact the companies’ global operations and profitability.(Reuters, Reuters)

Historical Context of Antitrust Actions

This is not the first time Visa and Mastercard have faced antitrust scrutiny. In 2019, Mastercard was fined €570 million by the European Commission for obstructing merchants’ access to cross-border card payment services. Additionally, both companies have been involved in antitrust litigation in the United States, including a significant class-action lawsuit concerning interchange fees.(Wikipedia)

Retailers’ Concerns and Calls for Action

European retailers have expressed concerns over the high and opaque fees charged by Visa and Mastercard. In a letter dated May 13, 2025, major retailers, including Amazon, Aldi, and Ikea, urged the European Commission to take action under EU antitrust rules. They highlighted that scheme fees had increased by nearly 34% from 2018 to 2022 without corresponding improvements in services.(Reuters)

Potential Outcomes and Industry Impact

Should the European Commission determine that Visa and Mastercard have violated competition laws, the companies could face fines of up to 10% of their global earnings. Such a ruling could also lead to mandated changes in their fee structures and operational practices. This would not only affect their operations in Europe but could also set a precedent influencing regulatory approaches in other jurisdictions, including the United States.(PYMNTS.com)

Conclusion

The European Commission’s expanded investigation into Visa and Mastercard’s fee structures underscores the growing regulatory scrutiny of major payment processors. The findings of this probe could have far-reaching implications, potentially reshaping the landscape of global payment systems and affecting stakeholders worldwide. U.S. investors and businesses should closely monitor developments, as changes in European regulations could influence global operations and strategies of these payment giants.(Reuters)

Frequently Asked Questions (FAQs)

Q1: What prompted the European Commission’s investigation into Visa and Mastercard?
A1: The investigation was initiated due to complaints from merchants and payment service providers about the scheme fees charged by Visa and Mastercard, raising concerns about potential violations of EU competition laws.(Reuters)

Q2: What are scheme fees?
A2: Scheme fees are charges imposed by card networks like Visa and Mastercard for participation in their payment systems. These fees are typically paid by banks and payment service providers and can influence the costs passed on to merchants and consumers.

Q3: How could this investigation affect U.S. stakeholders?
A3: If the European Commission mandates changes to Visa and Mastercard’s fee structures, it could impact their global revenue and operational models, thereby affecting U.S. investors, merchants, and consumers who rely on these payment systems.

Q4: Have Visa and Mastercard faced similar investigations before?
A4: Yes, both companies have previously been subject to antitrust investigations and litigation in both Europe and the United States, including significant fines and settlements related to their fee structures and market practices.(Reuters)

Q5: What is the next step in the European Commission’s investigation?
A5: The Commission is currently collecting responses to its detailed questionnaires from terminal providers and payment companies, with a deadline set for June 2, 2025. The findings from these responses will inform the Commission’s next steps, which could include formal charges or recommendations for regulatory changes.(Reuters)