Commercial cards will be exempted from a forthcoming European Union cap on card interchange fees after all, as the European Parliament announced Wednesday it has backed down from its original decision to block such an exemption. Without the exemption, the interchange fee charged on "four-party" commercial cards (effectively those issued as Visa or MasterCard cards) would have been cut from an average of 1.5 percent to a maximum of 0.3 percent, whereas "three-party" providers (principally American Express and Diners Club) would have been free to continue imposing much higher merchant fees.
All European legislation requires approval from both the Parliament and the Council of Ministers of the member states, but whereas the latter backed the European Commission's original proposal to exempt commercial cards, Parliament originally voted to oppose it. However, following "trilogue" negotiations between the three institutions, a Parliament communiqué said: "Commercial cards used only for business expenses would ... be exempt from the new rules." The statement added: "The negotiators also agreed that the new rules should not apply to so-called three-party card schemes such as Diners and American Express (involving only one bank) provided the card is both issued and processed within the same scheme."
AirPlus International senior manager for corporate strategy Michael Heilmann said: "This will preserve the level playing field in our niche. This is very good news for our industry."
The agreement hashed out by negotiators still requires formal approval by a plenary session of the Parliament, followed by the full Council of Ministers. Sources indicated the entire process could be concluded by April 2015.