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The Retail Industry Leaders Association (RILA) has criticized the proposed swipe fee settlement and told class plaintiffs to reject it. Since its unveiling last month, the proposed settlement, which aims to resolve lawsuits challenging the swipe fee practices of Visa and MasterCard, has garnered similar negative reactions from other industry groups.
“While Visa and MasterCard’s decision to pursue a settlement affirms the legitimacy of retailers’ claims, the flawed proposal upholds the networks’ anticompetitive practices and fails to provide retailers and their consumers with meaningful relief from tens of billions of dollars in hidden fees,” explained Sandy Kennedy, president of Arlington, Va.-based RILA. “We urge class plaintiffs to reject the proposal and send a clear message that a settlement that fails to engender competition and fix the broken electronic payments market is unacceptable.”
If the proposed settlement is approved after all, all retailers would have to abide by its terms. Among the many proposed terms that concern RILA and the retailers it represents is the release of Visa and MasterCard from any future legal claims related to their interchange practices, and terms that could hamper such emerging innovations as mobile payments.
“Retailers are concerned that in addition to limiting their future legal options, the proposed settlement preserves the Visa/MasterCard duopoly and constrains emerging innovations that could bring meaningful competition to the marketplace,” noted Kennedy.
Other industry organizations that have come out against the proposal include the National Association of Convenience Stores, the National Grocers Association, the National Cooperative Grocers Association and the National Community Pharmacists Association.