Competition Commission concludes investigation into alleged interchange price fixing between banks
Commercial banks may face penalties of up to 10% of turnover according to the Namibia Competition Commission who have just concluded an investigation into interchange price setting that involves the four large banks as well as the five small banks.
The Commission last week announced its conclusion of the investigation against the Payment Association of Namibia (PAN) and nine commercial banks for allegedly colluding to fix interchange fees which the Commission argues gives way for price fixing and market changing conditions.
According to a statement released by the Commission, PAN and nine other banks used a Payment Clearing House Schedule or Card Schedules to fix the interchange fees agreed between Namibian banks, with this practice ongoing for about six years from 2014 to 2020 when conditional approval was granted by the Commission.
The four big banks are First National Bank, Bank Windhoek, Standard Bank and Nedbank. The smaller banks are Banco Atlantica, Bank BIC, Letshego Bank, Trustco Bank and Nampost Savings Bank. Additionally, the Bank of Namibia is considered as an interested party that may be affected, the Commission stated, but the Development Bank did not feature in the list.
The Commission noted that no final decision has been made to invoke the legal process contemplated by Section 36 and 37 of the Competition Act which gives the concerned parties a grace period of 30 days in which they are allowed to make written submissions or oral representations to the Commission. Only after the grace period has lapsed will the Commission take a final decision on the legal route.
If the Commission decides to proceed with the charge against PAN in the High Court, it may seek relief in the form of a penalty of up to 10% of turnover, preventing this practice to continue, and for the respondent to pay the legal costs.
Dina //Gowases, Corporate Communications Practitioner at the Namibian Competition Commission.
