Two years ago the EU capped the fees, but that's immaterial to the fact that the fees prior to that were determined to be illegal under anti trust laws. The article is confusing, it's written badly and is mixing numbers and laws up. My understanding is this is not a retro active shakedown.
Also, I can only assume you're referring to Apple's case. My understanding is that calling it a retro active law shakedown is misleading. It was always illegal (who to blame for facilitating the behaviour is another question).
Consumer protection was one of the main reasons I voted to stay in the EU. Without the EU's clout these companies would be exploiting consumers relentlessly indefinitely and it's good to have an entity with clout who are able to fight back.
I agree the posted article isn't particularly clear - found this one [1] on the Guardian that's better.
The understanding I get from it is that MasterCard could be liable under UK law now that the EU court has decisively shown the fees charged to have been anti-competitive. What's required for the UK claimants is to show that harm was caused to them by these anti-competitive practices and that redress is due.
The Reuters article makes it seem like "the fees were just too high" is the reason for this suit. A court-of-law decision that anti-competitive practices took place makes a lot more sense as a pretext for a claim like this.
How is a 1% fee excessive? If you don't like MasterCard's rates, then don't accept MasterCard. If the government wants to ban such rates, then ban them. But allowing it for 20 years then digging up some vague "excessive fees" provision and demanding two decades and $20 billion worth of "excess profit" is nothing but a business-hostile dishonest shakedown.
> If you don't like MasterCard's rates, then don't accept MasterCard.
Visa and Mastercard basically have a monopoly on the market. To not accept Mastercard would do orders of magnitude more damage to your business than the impact your protest of not accepting them would have. It's completely unrealisitic to present that as a sensible option.
> is nothing but a business-hostile dishonest shakedown.
From the Guardian:
“MasterCard charged billions of pounds of unlawfully high fees for its sole benefit and to the detriment of consumers. It has already been found to have broken competition law, the basis of which was to protect consumers, and that cannot be disputed. There is no basis upon which MasterCard can contend that its card fees were not unlawful.”
So actually, Mastercard are the ones being business-hostile here.
My whole point is that "unlawfully high" was totally undefined. The intentions of the law are totally irrelevant here, just how it's being applied. I may not agree that it ultimately helps consumers, but if the EU wants to set rules for pricing, that's totally within their right. Applying rules retroactively is not fair and it creates uncertainty that strongly discourages businesses from rising and operating in Europe.
A law is not fair if there is no way for a reasonable actor to know whether their actions are legal or not. It's especially unfair when something is seemingly fine for 20 years but suddenly becomes not fine and the government wants to confiscate retroactively. This isn't some ongoing wrongdoing that was only recently discovered; MasterCard had this arrangement with probably hundreds of thousands of companies for decades.
Thanks for noticing, I mixed up Disover and Diners. The former is not issued in Europe, the latter has under 1% market share (according to the Nielson Report).
Also, I can only assume you're referring to Apple's case. My understanding is that calling it a retro active law shakedown is misleading. It was always illegal (who to blame for facilitating the behaviour is another question).
Consumer protection was one of the main reasons I voted to stay in the EU. Without the EU's clout these companies would be exploiting consumers relentlessly indefinitely and it's good to have an entity with clout who are able to fight back.