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Table of Contents

Lead Story

What will be in merchants' stockings this year - caviar or coal?


Industry Update

Farewell PABP, hello PA DSS

Visa, AmEx settlement no biggie for merchants

More public steps for bankcard heavyweights

Optimal socked by Internet gambling regs

Go international in real-time

It sings, it instructs, it's a gift card

Mobile checkout moving up


Data breaches pique interest

Travis K. Kircher

Growing on the 'Inside'


Art imitates life or does life imitate art?

Patti Murphy
The Takoma Group

Stay ahead with a checklist

Biff Matthews
CardWare International


Street SmartsSM:
We're all in the PCI loop, like it or not

Dee Karawadra
Impact PaySystem

What to watch in the coming months

Rob Drozdowski
Electronic Transactions Association

Using e-mail effectively: Copy and design

Nancy Drexler
Marketing Moguls

Security breaches costly to all

David Mertz
Compliance Security Partners LLC

Turning negatives into positives

Steve Schwimmer
Renaissance Merchant Services

Opportunity knocks at your online door

Curt Hensley
CSH Consulting Inc.

Liability limbo: Where will you land?

Adam Atlas
Attorney at Law

Company Profile

FirstView Financial LLC


New Products

A cherry of a keyboard

Cherry LPOS Qwerty Keyboard
Cherry Corp.

Sign on the dotted line - online

ContractPal Inc.


Holiday survival guide





Resource Guide


A Bigger Thing

The Green Sheet Online Edition

November 26, 2007  •  Issue 07:11:02

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Visa, AmEx settlement no biggie for merchants

After a three-year legal battle, Visa Inc. (which is absorbing Visa U.S.A. in its reorganization as a public company) and Visa International agreed to pay American Express Co. $2.1 billion on Nov. 8, 2007, to settle damages relating to an antitrust lawsuit.

What does this mean for the industry? Very little, according to David H. Press, founder and President of Integrity Bankcard Consultants Inc.

Press said the industry won't see the ripple effects. "I just don't see it having any affect on the acquiring side," he said. If anything, Press suggested the outcome could produce a higher volume of transactions.

In 2004, AmEx and Discover Financial Services sued Visa, MasterCard Worldwide, and several of their members banks - JPMorgan Chase & Co., Capital One Services Inc., U.S. Bancorp, Wells Fargo & Co., and Providian Financial Corp., now owned by Washington Mutual Inc.

The agreement is subject to the approval of Visa's member banks for imposing rules that prohibited financial institutions from issuing credit cards through AmEx.

The settlement will drop Visa and the member banks from the suit, leaving MasterCard the sole defendant.

The suit was filed shortly after the U.S. Supreme Court let stand a lower-court ruling that forced the card Associations to allow their member banks to issue credit cards on rival networks.

"The size of this settlement, along with earlier court rulings, underscores the seriousness of the damage done by the illegal boycott," said Kenneth I. Chenault, Chairman and Chief Executive of AmEx.

According to Press, the access AmEx will now have could open the door for an attractive compromise in order to keep up with the card Assocations. "If AmEx wants to gain on the acquiring side of the business, lowering rates that they charge the merchants would be a great start," he said.

In the 1990s, AmEx rates were 4% versus Visa and MasterCards's 1.2%. Currently, AmEx offers a 2.5% rate, while Visa and MasterCard are still slightly lower at 2%, with signature debits at 1.7%.

As yet, MasterCard has made no moves in the lawsuit.

But AmEx hasn't lost momentum. "We plan to move forward with the litigation to hold MasterCard accountable for the illegal actions that blocked banks from working with us for many years and to seek full compensation for the value that would have been generated for our shareholders," Chenault said.

Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.

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