This is why Bancomat knocks on the Antitrust Authority against Mastercard
The Antitrust Authority initiated an investigation against Mastercard upon notification from Bancomat. Subject: contactless payments. All the details
Risk of abuse of dominant position for Mastercard, according to the Antitrust hypothesis.
The Agcm – Antitrust Authority – has initiated an investigation against Mastercard Europe upon notification of Bancomat, in the context of contactless payments, which take place without inserting the card in the Pos and typing in the Pin.
Specifically, the conduct subject to reporting concerns the imposition of the double-tap procedure for contactless payments. Based on this payment method, after placing the card (or device) on the POS (first tap), the holder is asked which circuit he prefers and, after having selected the desired circuit on the POS, places the card again on the POS. Pos (second tap) for the payment to take place. It differs from the single-tap procedure which provides, instead, that the payment takes place directly when the card is placed on the Pos.
This is what we read in the Authority's weekly bulletin .
In particular, the Antitrust Authority will ascertain the existence of a case of abuse of a dominant position, in possible violation of Article 102 of the TFEU.
The procedure initiated by the Agcm must be completed by 31 December 2022.
All the details.
ANTITRUST LIGHTHOUSE ON MASTERCARD
The Antitrust has initiated an investigation against Mastercard Europe to ascertain the existence of violations of the competition rules, in particular Article 102 relating to the abuse of a dominant position, in the context of contactless payments. That is, payments that take place without inserting the card in the Pos and typing in the Pin, but with the simple contact of the card or even the smartphone or smartwatch or any other enabled device.
THE BANCOMAT COMPLAINT
The Authority's resolution follows the denunciation of Bancomat, the Italian company that manages the Bamcomat and PagoBancomat circuit of the same name and the related cards, against the new binding rules imposed by the Mastercard last July.
CONDUCT SUBJECT TO REPORT
The reported conduct concerns the imposition of the double-tap procedure for contactless payments starting from January 1, 2022, and penalties, such as the application of penalties and the revocation of the license, in the event of non-compliance with the new rules. The new rules require to modify the Pos terminals so that, in the case of contactless payments with cards bearing two brands (co-badged cards), the payer is always required to bring the card twice to the Pos (double-tap) , and it is no longer possible to pay by touching the card only once, (single-tap).
The Mandate communicated by Mastercard applies only to the Italian territory and only to payments with co-badged cards.
Bancomat, recalling that co-badged cards represent 99% of the cards issued and that its mono-brands would be completely residual, denounces an asymmetry determined by the Mastercard Mandate capable of affecting the competitive dynamics of the market and undermining, in the long term , the presence of ATMs in the market.
THE SURVEYS OF THE ANTITRUST
In addition, as a result of the Mastercard Mandate, ATM cards would be denied access to single-tap mode.
According to the Authority, the Mastercard mandate "appears potentially suitable for compromising intra-European trade, as the new circuit rules affect the entire Italian territory and affect all financial institutions that provide card agreement and card issuance services in Italy ".
"It is also necessary to consider that, from the point of view of the terminals which, by order of Mastercard, must be modified to accept the double-tap method, the measure would in fact concern all the Pos" adds the Agcm.
Believing that the Mastercard mandate could constitute a case of abuse of dominant position, in possible violation of Article 102 of the TFEU, the Authority approved the initiation of the investigation.
WHAT MASTERCARD WILL DO
Mastercard has 60 days to be heard. The procedure must be completed by 31 December 2022
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/perche-bancomat-va-antitrust-contro-mastercard/ on Tue, 21 Dec 2021 11:45:11 +0000.