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RAPAPORT... A number of major U.S. retailers sued Visa and MasterCard over swipe fees, ahead of a May 28 deadline for retailers to opt in, or out, of a $7.25 billion proposed settlement on this same issue. Plaintiffs, including Macy's, Target, JCPenney, Kohl's and TJX, now seek compensatory and triple damages and other remedies. Earlier this week, the National Retail Federation (NRF) opposed the current settlement of the federal antitrust lawsuit over credit card swipe fees charged by Visa and MasterCard, and the organization urged retailers to carefully consider their own decisions before agreeing to the settlement. The NRF is not a party to the antitrust suit, but added that the settlement does nothing to bring swipe fees under control and would give Visa and MasterCard a legal blessing to continue their abuse of merchants and consumers indefinitely. Meanwhile, Visa Europe this week agreed to “significantly” lower its processing fees for credit cards on the continent to thwart an antitrust investigation by the European Union. Visa is expected to lower fees by 40 percent to 60 percent to 0.3 percent of the transaction value for domestic and cross-border payments and keep the plan in place for four years. MasterCard settled with the European Union's antitrust division with a similar fee reduction about four years ago but it appealed the ruling. In the U.S., where swipe fees average about 2 percent of the transaction, those retailers who do not opt out of the settlement will be eligible for a share of $7.25 billion, but in return they agree not to pursue further litigation against the credit card companies. The original lawsuit was brought in 2005 by 19 trade associations and individual retail companies, but a majority – including Walmart, Starbucks, Costco all six trade associations – rejected the settlement when it was proposed in 2012. The NRF said these bank fees have tripled over the past decade and drive prices up for the average household by more than $250 per year.
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