Friday January 11, 02:30 PM
First Data Corp, Allied Irish Banks payment card services JV cleared by EU
BRUSSELS (Thomson Financial) - The European Commission said it has cleared Allied Irish Banks PLC's proposed payment card services joint venture with electronic commerce and payment solutions provider First Data Corp (NYSE: FDC
- news) .
The joint venture will provide services relating to the use and acceptance of payment cards, primarily in Ireland but also in other EU member states.
The commission said the operation would not significantly impede effective competition in the European Economic Area (EEA).
The new joint venture will be called AIB Merchant Services and will be based in Ireland. It will provide two types of payment card services -- merchant acquiring and payment card processing.
The EU executive said the parties' activities in overall merchant acquiring overlap in three member states -- the UK, Italy and the Netherlands. The parties' joint market shares do not exceed 15 pct in any of these countries, according to the commission.
Following the transaction, the parties' joint share of all merchant acquiring in the EEA will be less than 1 pct.
'Due to the limited activities of Allied Irish Banks (Dublin: AIB.IR - news) , the increase in market share would be marginal. As regards payment card processing, there are no significant overlaps and there are strong competitors in all member states in which the parties' activities overlap,' the commission said in a statement.
As Allied Irish Banks currently accounts for a substantial part of the Irish market for merchant acquiring and First Data Corporation holds a controlling stake in Omnipay - a payment processing platform located in Ireland -- the commission checked whether any competition concerns would arise from the vertical relationship between the merchant acquiring services to be offered by the joint venture and the transaction processing services provided by First Data Corporation in Ireland.
It found that Omnipay provides processing services for transactions originating all across Europe, and not only in Ireland, and that the joint venture would face competition from a number of competitors both in Ireland and elsewhere in the EEA.
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