Arlington, VA – In a unanimous vote, the Board of Directors of the National Grocers Association (NGA) approved a resolution opposing the proposed interchange fee settlement agreement in the antitrust litigation by merchants against Visa, MasterCard, and their member banks. NGA is a named plaintiff and class representative in the lawsuit In Re Interchange Fee and Merchant Discount Antitrust Litigation.
“NGA joined the lawsuit on behalf of its independent retail grocer members over seven years ago to bring about real reform of the anticompetitive credit card swipe fee system. This proposed settlement agreement fails in this regard by allowing Visa and MasterCard to continue their dominant anticompetitive practices,” said NGA President and CEO Peter Larkin. “Meanwhile, merchants and consumers will continue to pay exorbitant swipe fees with no hope of reform. NGA’s members are also concerned about Visa and MasterCard’s ability to use their dominance to prevent emerging and innovative lower cost payment options.”
The proposed settlement agreement terms would curtail the opportunity for merchants to reform the monopolistic fees and rules set by Visa, MasterCard, and their banks by requiring merchants to broadly waive their rights to take future action against the card companies. While the proposed agreement does provide merchants with the ability to pass along some costs of accepting cards, it only does so under almost ten pages of burdensome restrictions imposed and enforced by Visa and MasterCard, making it unlikely that many of NGA’s members will be able to make this provision workable.
In addition, the provision for cost of acceptance charges does little-to-nothing for grocers who are keenly sensitive to the backlash consumers exhibited to bank fees, and how consumer reactions could particularly affect the ultra-competitive supermarket industry. Merchants already face the reality that surcharging is currently prohibited in California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas where 42 percent of all U.S. retail sales are made.
“The proposed settlement represents a small fraction of the $350 billion in swipe fees the card companies have charged merchants and ultimately consumers for the last seven years. This agreement only ensures that the card companies will continue to fix hidden swipe fees and be able to increase them at will for years to come,” said NGA President and CEO Peter J. Larkin.
NGA has retained the services of Constantine Cannon to represent it in the case going forward.
For more information about NGA, its government relations priorities, key issues and members visit www.nationalgrocers.org.
Source: National Grocers Association
