The Turkish Competition Board (RK) said on Thursday it had decided to open investigations into Türkiye-related businesses of Mastercard and Visa after a preliminary probe in the area of discount and incentive schemes.
It said it decided to open investigations into various units of the two companies, including Mastercard Europe SA and Visa Europe Limited.
According to the announcement on the website of the competition authority, the preliminary investigation regarding allegations that Mastercard and Visa, global payment system service providers, violated the Law on the Protection of Competition in the markets for scheme and digital wallet services in Türkiye through various exclusionary practices, has been concluded.
As a result, an investigation has been initiated into the economic entities comprising Mastercard Europe SA, Mastercard Europe SA Istanbul Liaison Office and Masterpass Technology Services Inc., which are under the control of Mastercard Incorporated, as well as Visa Europe Limited, Visa Europe Services LLC and Visa Europe Services LLC Türkiye Representation, which are under the control of Visa Inc.
The investigation aims to determine whether these entities violated the law through various exclusionary actions in the scheme and digital wallet services markets where they operate.
The authority will examine whether the discount/incentive systems separately developed by Mastercard and Visa in the scheme services market, where they hold the majority of bank, credit and prepaid cards issued in Türkiye, could lead to de facto exclusivity in their vertical relationships with card-issuing businesses, thus risking the foreclosure of the market to competitors either independently or cumulatively.
The investigation will also assess the potential anti-competitive effects of Visa’s non-compete obligations imposed on its acquiring entities in the digital wallet services market, which prevent them from obtaining services from rival providers. Additionally, it will investigate whether Mastercard has abused its dominant position in the digital wallet services market through practices such as predatory pricing and other actions that hinder the operations of competitors.
Furthermore, the initiation of the investigation does not imply that the entities or associations under investigation have violated the law or face sanctions.
Earlier this year, the U.S. Department of Justice (DOJ) filed a lawsuit accusing Visa of violating antitrust law by suppressing competition by threatening merchants with high fees and paying off potential rivals.
Visa, one of the world's largest payment networks, processes more than 60% of debit transactions in the U.S., bringing it $7 billion each year in fees collected when transactions are routed over its network, the Justice Department said. The company protects that dominance through agreements with card issuers, merchants and competitors, prosecutors alleged.
Visa and Mastercard continue to dominate the payment landscape in general globally and are considered essentially as a duopoly.
The concerns over Visa and Mastercard practices in the market they are operating in could stem from a general rise in the use of credit and debit cards worldwide, especially following the coronavirus pandemic.
