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Competition and Payment Systems 2012

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Competition and Payment Systems 2012 Competition and Payment Systems 2012 The OECD Competition Committee discussed payments systems in October 2012. This document includes an executive summary of that debate, a detailed summary of discussion and the documents from the meeting: a note by Mr. Wilko Bolt and written submissions from Canada, Denmark, Estonia, European Union, France, Germany, Hungary, Iceland, Indonesia, Israel, Latvia, Lithuania, New Zealand, Norway, Poland, Romania, Russian Federation, Switzerland, Chinese Taipei, Turkey, United Kingdom, United States and BIAC. The ongoing shift from cash and paper towards electronic payment systems potentially brings large economic benefits. But card payments in particular have remained expensive for merchants, and regulation may have unintended consequences. There is no consensus among economists and policymakers on what constitutes an efficient fee structure for card-based payments, and it is not clear if payment competition might do the trick. Regulation should be geared towards removing barriers of entry in payment markets and banning merchant (pricing) restrictions. The discussion reviewed recent countries’ experiences on developments regarding all non-paper based forms of payment such as debit and credit cards, and E-payments (through internet, mobile phones etc.). Many members are investigating these markets, and EU jurisdictions are implementing the EU payments service directive, which aims to provide a single market for payments. Market Definition (2012) Competition, Concentration and Stability in the Banking Sector (2010) Competition and Financial Markets (2009) Competition and Efficient Usage of Payment Cards (2006) Competition in Retail Banking (2006) Enhancing the Role of Competition in the Regulation of Banks (1998) Unclassified DAF/COMP(2012)24 Organisation de Coopération et de Développement Économiques Organisation for Economic Co-operation and Development 28-Jun-2013 ___________________________________________________________________________________________ _____________ English - Or. English DIRECTORATE FOR FINANCIAL AND ENTERPRISE AFFAIRS COMPETITION COMMITTEE Unclassified DAF/COMP(2012)24 COMPETITION AND PAYMENT SYSTEMS English JT03342499 Complete document available on OLIS in its original format - This document and any map included herein are without prejudice to the status of or sovereignty over any territory, to the delimitation of Or. English international frontiers and boundaries and to the name of any territory, city or area. DAF/COMP(2012)24 FOREWORD This document comprises proceedings in the original languages of a Roundtable on Competition and Payment Systems held by the Competition Committee in October 2012. It is published under the responsibility of the Secretary General of the OECD to bring information on this topic to the attention of a wider audience. This compilation is one of a series of publications entitled "Competition Policy Roundtables". PRÉFACE Ce document rassemble la documentation dans la langue d'origine dans laquelle elle a été soumise, relative à une table ronde sur la concurrence et les systèmes de paiement qui s'est tenue en octobre 2012 dans le cadre du Comité de la concurrence. Il est publié sous la responsabilité du Secrétaire général de l'OCDE, afin de porter à la connaissance d'un large public les éléments d'information qui ont été réunis à cette occasion. Cette compilation fait partie de la série intitulée "Les tables rondes sur la politique de la concurrence". Visit our Internet Site -- Consultez notre site Internet http://www.oecd.org/daf/competition/ 2 DAF/COMP(2012)24 TABLE OF CONTENTS EXECUTIVE SUMMARY ............................................................................................................................. 5 CONTRIBUTIONS FROM DELEGATIONS Canada ................................................................................................................................................... 9 Denmark .............................................................................................................................................. 15 Estonia ................................................................................................................................................. 21 European Union .................................................................................................................................. 23 France (Version Française) ................................................................................................................ 33 France (English Version) ................................................................................................................... 41 Germany .............................................................................................................................................. 49 Hungary ............................................................................................................................................... 55 Iceland ................................................................................................................................................. 61 Indonesia ............................................................................................................................................ 67 Israel .................................................................................................................................................... 71 Latvia................................................................................................................................................... 75 Lithuania ............................................................................................................................................. 77 New Zealand ....................................................................................................................................... 83 Norway ................................................................................................................................................ 91 Poland .................................................................................................................................................. 97 Romania ............................................................................................................................................ 103 Russian Federation ............................................................................................................................ 109 Switzerland ........................................................................................................................................ 115 Chinese Taipei ................................................................................................................................... 125 Turkey ............................................................................................................................................... 129 United Kingdom ................................................................................................................................ 133 United States ..................................................................................................................................... 139 BIAC ................................................................................................................................................. 149 CONTRIBUTION FROM EXPERTS Mr. Wilko Bolt -- Retail Payment Systems: Competition, Innovation and Implications .................. 161 OTHER REFERENCES .............................................................................................................................. 171 SUMMARY OF DISCUSSION .................................................................................................................. 177 *** SYNTHÈSE ................................................................................................................................................. 201 COMPTE RENDU DE LA DISCUSSION ................................................................................................. 207 3 DAF/COMP(2012)24 4 DAF/COMP(2012)24 EXECUTIVE SUMMARY By the Secretariat In light of the written submissions and the oral discussion, the following points emerge: (1) An aim of competition enforcement is to identify, stop and deter anti-competitive arrangements and behaviour by market participants, particularly when it has a direct impact on consumer welfare. In the payment systems sector, where many markets operate with multi-sided platforms, anti-competitive arrangements and behaviour may have an impact on participants in different markets, be they consumers, merchants or banks. An initial consideration for competition authorities is generally to properly define the relevant markets that an arrangement or behaviour affects. Many relevant markets in the payments systems sector involve multi-sided platforms. It is appropriate to consider this industry characteristic, just as any other relevant industry characteristics are appropriate to consider in the process of obtaining a thorough understanding of how a particular market functions; competition analysis is always a fact-driven process. In markets with multi-sided platforms, a number of markets may be affected by a restriction on competition, but the competition analysis will normally focus just on the relevant market where the restriction of competition is found. For example, in the EU's decision concerning MasterCard MIFs, the relevant
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