EU authorities should get their own house in order says EPC

The European Payments Council (EPC), which is being investigated by the European Commission for alleged antitrust violations in the e-payments market, has hit back at the Commission, saying it needs to stop sending out conflicting messages.

The Commission announced Monday that it has launched a probe into the EPC's work on creating a Europe-wide standard for online payments following complaints that it was blocking new companies from entering the market. EPC's members are some of the E.U.'s biggest banks including Deutsche Bank, HSBC, BNP, Santander and Barclays.

However, the EPC said that it was getting conflicting messages from E.U. authorities regarding harmonization and competition. "Going forward, the EPC requires that the European Commission aligns its views on the merit of market integration and innovation on the one hand and competition on the other. Inconsistencies between the European Commission's objectives continue to hamper the SEPA progress," said EPC Chairman Gerard Hartsink on Tuesday.

Currently, most e-payment systems only work within national borders. The Single Euro Payments Area (SEPA) being developed by EPC would allow an Internet user to buy online regardless where he is located in Europe, and to pay the merchant using his own Internet banking services and current bank account.

The EPC does not support the allegations that its work in this area could potentially discriminate against any market participants. It added that as the standardization is a work in progress, it could not possibly be blocking new market entrants.

"To-date no final documentation has been published. The EPC therefore does not support the allegations by the Commission that the EPC's work in this area could potentially discriminate against new market entrants or other service providers."

The SEPA e-payment framework is designed to support interoperability between existing e-payment systems as well as new e-payment systems, EPC said.

However, German company, Payment Network AG, which made the complaint to the Commission, believes otherwise. The company offers online payment systems to companies such as Dell, Dutch airline KLM and Conrad hotels, but is not a bank.

"As a provider of e-payment solutions in many E.U. member states, Payment Network AG supports efforts to achieve more interoperability and competition in the common market and in particular an integrated payments market. Payment Network AG is, however, of the opinion that such standardization processes must not restrict competition unduly and in particular that bank-independent service providers of innovative payment solutions should be given a fair chance," said the company on Tuesday.

Follow Jennifer on Twitter at @BrusselsGeek or email tips and comments to jennifer_baker@idg.com.

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