04 February 2016

Italian AGCM probes banking association over “SEDA” interbank agreement

The Italian competition authority (AGCM) has launched an investigation into the Italian Banking Association (ABI) in relation to the price of a new auxiliary service, "Sepa Compliant Electronic Database Alignment” (SEDA). The AGCM opened the investigation after receiving the ABI's agreement in December 2013 which regulates the functioning of SEDA.

SEDA is an optional auxiliary service to Sepa Direct Debit and helps creditors collect information required to carry out direct debit transactions. The service was introduced following the adoption of the EU Payments Service Directive and Regulation.

The AGCM is concerned that the new system set up by the ABI to implement the SEDA service may infringe Article 101 TFEU.

The ABI has stipulated (i) the characteristics of the system, (ii) the contractual scheme and remuneration system and (iii) an obligation on all its members to provide the basic SEDA service. The ABI is also the entity responsible for managing SEDA. The AGCM is investigating whether the system is likely to restrict competition because it facilitates coordination between banking operators through rules regulating the functioning of SEDA, and is concerned that the ABI may facilitate such restriction by imposing and overseeing the application of the rules.

Furthermore, the AGCM has noted that creditors will pay commission twice, once to their own bank and then again to the bank of their debtors. The debtor bank's rate of commission is set unilaterally, without the possibility of choosing to make the payment to a provider with lower rates. The debtor bank’s pricing scheme is therefore unlikely to receive any competitive pressure from the market. This may result in an increase in prices which could be passed down to consumers. Indeed, the AGCM already claims to have evidence that, since the new system was introduced in 2013, the prices of the SEDA service have increased by between 30% and 80%.

The AGCM has until 31 March 2017 to conclude its investigation.

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