OTTAWA
– Today, Senator Pierrette Ringuette commends the Competition Bureau’s recent
announcement that it has filed an application with the Competition Tribunal to
put an end to the “restrictive and anti-competitive” practices of VISA and
Mastercard.
As noted by
the Competition Bureau, these practices “prohibit
merchants from encouraging consumers to consider lower cost payment options
like cash or debit, and prohibit merchants from applying a surcharge to a
purchase on a high cost card. Further, once a merchant agrees to accept one of
Visa or MasterCard's credit cards, that merchant must accept all credit cards
offered by that company, including cards that impose significant costs on
merchants, such as premium cards.”
Visa
and Mastercard process over 90% of the credit card transactions in Canada, over
$240 billion in purchases and an estimated $5 billion in hidden fees annually.
The
fees paid by Canadian merchants exceed those in many other parts of the world,
“ranging from 1.5% to 3% or more of each purchase, nearly twice as much as
their counterparts in Europe, New Zealand, and Australia.”
The
transaction fee for an Interac debit transaction, on the other hand, is only 12
cents, no matter the transaction amount. The Competition Bureau provides a good
example of this contrast; “a 3 percent hidden credit card fee on a $400
set of snow tires is $12, but if a debit card is used for the same purchase,
the fee is 12 cents.”
Senator
Ringuette has been arguing on behalf of consumers and merchants for some time
that Canada has some of the highest credit card fees in the world saying that
“We should join Europe, New Zealand, and Australia and legislate rules for
reasonable fees on credit cards.”
“I
am extremely pleased by this announcement,” said Senator Ringuette “I have been
pushing for the Competition Bureau to address these practices for a long time a
long, long time. Today is a hard fought victory for Canadian consumers and
small business.”
The Completion Bureau
press release and fact sheet can be viewed at:
http://www.competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/03325.html