MasterCard’s interchange fee dispute. European Commission came to a decision

Today the European Union's executive arm dismissed the case against MasterCard over its transaction fees putting an end to the battle which led to much confusion among banks building a new pan-EU payments system, as reported by Reuters.

In December 2007 the European Commission ruled that the interchange fee imposed by MasterCard on retailers violates EU anti-trust regulation and should be change within six months. Having declined to follow the ruling MasterCard appealed to the European Court of Justice in a lawsuit that has yet to be concluded.

According to EU Competition Commissioner Neelie Kroes there is no need in pursuing MasterCard further in light of its having reduced the MIF transaction fees to 0.2-0.3%.

"We will be monitoring implementation closely in coming months," Kroes said in a statement. 

A similar investigation into another largest payment card network Visa is still on.

The European Union is implementing a single euro payments area (SEPA) so that consumers can make credit and debit payments anywhere in the 27-nation bloc in euros from a single bank account but the banks confused by the legality of MIF were concerned about the business model to use for launching rival cross-border payment card schemes, threatening SEPA's rollout.