The Competition Authority imposes a 500 m. ISK fine on Valitor, a firm operating in the payment card market, for serious breaches of competition law.


In the decision of the Competition Authority, no. 8/2013, which is published to day, the authority concludes that Valitor, a firm operating in the payment card market, has abused its dominant position on the market by actions aimed at the competitors of Valitor in the payment card acquiring services market in Iceland. Valitor has also breached the conditions of a settlement between Valitor and the Competition Authority which Valitor was obliged to honour.

Valitor operates in the market for payment card acquiring services. Payment card acquiring services consist in authorising vendors to accept payments by payment cards, collecting their data and disbursing the proceeds when card holders pay their bills. Valitor has a dominant position on this market in Iceland, but two other undertakings operate on this market, Borgun hf. and Kortaþjónustan (Teller).

In the end of 2007 Valitor admitted extensive breaches of the competition act and agreed to pay an administrative fine to the amount of 385 m. ISK. Valitor also agreed to abide by conditions which were meant to prevent the company in abusing its dominant position on the market by actions that would cause competitive harm to its competitors. This case was concluded in the beginning of 2008 with the decision of the Competition Authority no. 4/2008.

In the decision of the Competition Authority, published today, the Competition Authority states that Valitor breached against two conditions which the undertaking had agreed to abide by by the settlement from 2007. Amongst other things, Valitor abused confidential information about its competitors in the market for acquiring services which the undertaking had access to because of its operations as the issuer of VISA cards here in Iceland. These conditions were a response to serious breaches of Valitor and were set to prevent further breaches by the undertaking. The Competition Authority deems it very serious when undertakings breach conditions of this kind, which they have agreed to abide by.

Valitor is also guilty of predatory pricing, and it priced its services in acquiring services for debit cards under variable cost  in the years 2007 and 2008. By this pricing, the undertaking was likely to gain contracts with vendors in acquiring services of credit cards, which are considered to be a more profitable service. The scale of the predatory pricing was considerable.

Valitor has been found guilty of repeated offence and the Competition Authority deems these offences to have been committed with intent. These are very serious offences and the Competition Authority deems it fitting that Valitor pay 500 m. ISK in administrative fines.

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