WTO favors both China and US in cards row
Source: Bloomberg News |
July 17, 2012, Tuesday
|
Print Edition
Print Edition
WORLD Trade Organization judges partially sided with the United States in its complaint against Chinese curbs on companies such as Visa Inc and MasterCard Inc that process credit-card payments.
The US protested to the WTO about the limits on payment processing, saying China favors China UnionPay Data Co and forbids foreign companies from issuing their own bank cards denominated in its currency, building networks to support such cards or handling interbank point-of-sale transactions.
WTO judges in Geneva agreed with the US that China "unfairly discriminates against" foreign suppliers of electronic-payment services by imposing requirements on them that aren't applied to domestic companies.
But they rejected the US argument that UnionPay monopolizes the handling of domestic-currency payment-card transactions.
Shares in MasterCard, Visa and Discover Financial Services climbed after the WTO ruling.
Visa, the world's biggest payments network, is reviewing the panel report, said Will Valentine, a spokesman at the San Francisco-based company.
"We are hopeful that this ruling will pave the way for international payment companies to participate in the domestic payments marketplace in China," he said. "In the meantime, our existing business in China is healthy."
The WTO ruling "clarifies the market situation" and makes opportunities for MasterCard "all the more interesting," a spokesman said.
The US protested to the WTO about the limits on payment processing, saying China favors China UnionPay Data Co and forbids foreign companies from issuing their own bank cards denominated in its currency, building networks to support such cards or handling interbank point-of-sale transactions.
WTO judges in Geneva agreed with the US that China "unfairly discriminates against" foreign suppliers of electronic-payment services by imposing requirements on them that aren't applied to domestic companies.
But they rejected the US argument that UnionPay monopolizes the handling of domestic-currency payment-card transactions.
Shares in MasterCard, Visa and Discover Financial Services climbed after the WTO ruling.
Visa, the world's biggest payments network, is reviewing the panel report, said Will Valentine, a spokesman at the San Francisco-based company.
"We are hopeful that this ruling will pave the way for international payment companies to participate in the domestic payments marketplace in China," he said. "In the meantime, our existing business in China is healthy."
The WTO ruling "clarifies the market situation" and makes opportunities for MasterCard "all the more interesting," a spokesman said.
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