The National Retail Federation announced on Tuesday that it plans to oppose a proposed settlement over Visa and MasterCard’s credit card swipe fees, urging retailers to consider their decisions before next week’s specified deadline.
“The proposed settlement does nothing to bring swipe fees under control and would give Visa and MasterCard a legal blessing to continue their abuse of merchants and consumers indefinitely,” NRF Senior Vice President and General Counsel Mallory Duncan said. “No settlement at all would be better than this one-sided ‘agreement’ written by the card companies for the card companies that would tie retailers’ hands for decades to come.”
Though many retailers have already filed their opposition with Brooklyn’s U.S. district court, many smaller retails have been hesitant to act because they lack the legal knowledge and expertise to fully assess the proposal. Retailers that oppose the plan have until May 28 to opt out of the settlement.
Retailers filed suit against Visa and MasterCard in 2005, saying the credit card companies colluded to fix interchange—or swipe fees—unreasonably high.
Under the terms of the settlement, Visa and MasterCard agreed to reduce interchange fees on a temporary basis and pay $6 billion to retailers. Retailers are also permitted to surcharge consumers who pay with plastic, a practice previously prohibited by the credit card companies.
Critics of the settlement have said, however, that it protects Visa and MasterCard from future litigation involving swipe fees.
Retailers who have opted out of the settlement include Wal-Mart, Starbucks, Gap, Lowe’s, Costco and Nike, Bloomberg reports.