Visa says its transaction fees fully justified

By Huw Jones

BRUSSELS (Reuters) - Visa Europe's charges for cross-border consumer payment card transactions are justified in terms of costs and benefits, the company said on Wednesday.

Visa Europe was responding to news last week that the European Commission has opened an antitrust probe into the company's interchange fees which have been branded by retailers as a tax on consumers.

Visa Europe's president and CEO, Peter Ayliffe, said the 0.7 percent fee on transactions was justified on cost grounds.

The company will also demonstrate to Brussels that it was justified because of the benefits its cards brought to consumers and retailers, it said.

"This is something we believe we can do... We are pulling the evidence together," Ayliffe told a news briefing.

Visa was reassured by comments from EU Competition Commissioner Neelie Kroes and EU Internal Market Commissioner Charlie McCreevy that interchange fees were not illegal, Ayliffe said.

Visa's fee was exempt from EU competition law from 2002 to December last year and the company is now holding talks with the Commission on a new agreement, saying it had fully expected the bloc's executive body to open formal proceedings.

"We believe a negotiated settlement is the right way forward. That is the view we are getting back from the Commission," Ayliffe said.