Competition Commissioner Nellie Kroes has asked Labour MEP Joseph Muscat to provide him with evidence that Maltese banks have decided collectively to impose an additional two per cent fee on retailers over and above the multilateral interchange fees (MIF) when customers use credit cards to pay for purchases.
The European Commission is investigating whether credit card companies Visa and Mastercard are breaching EU rules when imposing certain interchange charges known as multilateral interchange fees.
Dr Muscat had asked for the EU executive's assessment on claims made recently by the Chamber for Small and Medium Enterprises - GRTU that banks are charging an additional fee over the MIF..
He questioned whether this practice is acceptable to the EU, given the dominant position of both Visa and Mastercard in Malta.
Commissioner Kroes told Dr Muscat that although in its ongoing investigation the Commission did not address this specific issue, it would be most interested in obtaining information on this practice.
"Although the Commission decision found that the MIF set an effective floor to the Merchant Service Charge (MSC) levied by banks on retailers for accepting card payments, the Commission decision did not directly address the level of the MSC.
"The additional two per cent fee agreed by Maltese banks, to which the honourable member refers, seems to relate to the MSC levied on retailers.
"Therefore, this fee does not directly fall under the scope of the decision," Commissioner Kroes told Dr Muscat. The Commission is at loggerheads with Visa and Mastarcard for certain charges they are imposing on retailers and banks.
Last December it ordered Mastercard to come up with an alternative system to its MIF charges by June.
It is insisting with the company that the current MIF system is contrary to EU antitrust rules.
And last Wednesday, the Commission launched antitrust proceedings against Visa over the interchange fees the company charges for cross-border consumer payment card transactions.
The Commission said that Visa Europe, owned by 4,600 banks that have issued 348 million cards, including thousands in Malta, was suspected of breaching EU rules which forbid restrictive business practices such as price fixing.
Currently, retailers must pay a multilateral interchange fee (MIF) each time a customer uses a card to make a purchase.
A customer buys an item and later pays a charge card bill to the bank. The customer's bank deducts the MIF and passes the remainder to the merchant's bank.
This, according to the Commission, is "abusive" and not according to its competition rules.