MasterCard must drop fees it charges for cross-border transactions or face daily fines of 3.5 percent of daily global turnover, European Union regulators said Tuesday.
According to the Associated Press, The European Commission said that multilateral interchange fees charged to consumers for payments made in a different European country with either their MasterCard credit cards or Maestro debit cards unfairly inflated costs for retailers.
EU Competition Commissioner Neelie Kroes also warned that she would reopen a probe into Visa’s fees on Dec. 31.
White Plains-based MasterCard said it would appeal to the EU courts, claiming the decision would lead to higher cardholder costs and fewer electronic payments.
Neither the EU nor MasterCard would discuss how much the fines would amount to, but Mastercard had $3.3 billion in revenues in 2006. Fines would be based on the turnover in the current fiscal year.
Europeans make more than 23 billion card payments every year worth over 1.35 euros trillion ($1.94 trillion). They pay additional fees using their cards in another European nation, which regulators say curtails Europe’s attempt to create a single market in 27 EU states.
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