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The Danish Competition Appeals Tribunal confirms that Teller (now Nets) abused its dominant position by using rebates conditional on exclusivity and exclusivity provisions

23. September 2019

The Danish Competition Appeals Tribunal (DCAT) confirmed the 18th of September 2019 the ruling by the Danish Competition Council (DCC) in a case concerning Teller’s (now Nets) abuse of dominant position. The DCC will now submit the case to the Danish State Prosecutor for Serious Economic and International Crime.

The 29th of August 2018 the Danish Competition Council (“DCC”) ruled that Teller, a merchant acquirer of payment cards, had abused a dominant position on a Danish merchant acquiring market by use of rebates conditional on exclusivity and provisions regarding exclusivity . Teller’s agreements with some of the company’s largest customers contained provisions which had a loyalty enhancing effect and could foreclose competitors’ access to the market.

The 18th of September 2019 the DCAT upheld the decision by the DCC and thus confirmed that Teller did abuse its dominant position in the period from 2012 to 2016 by using such conditional rebates and/or provisions regarding exclusivity. Furthermore, the DCAT found that Teller had not documented that it was justified that the agreements in question contained provisions and rebates capable of anti-competitive foreclosure. Finally, the DCAT did not find any formal procedural steps carried out by the Danish Competition and Consumer Authority during the proceedings not being in line with the general principles of good public administration.

The DCC will now submit the case to the Danish State Prosecutor for Serious Economic and International Crime.

Until 2016 Teller was a subsidiary in the Nets-group. Teller merged in December 2017 with the group-company Nets Denmark A/S and was hereafter branded as Nets. Teller was in the relevant period the largest acquirer of international payment cards in Denmark and was dominant on the Danish market for merchant acquiring services and mobile payment solutions for POS payments. An acquirer is necessary in order for a merchant or other business to accept payment cards. The merchant in question pays the acquirer a fee per transaction – and the acquirer enables the transfer of money from the customer’s account to the merchants account.

The decision by the DCC (only in Danish) can be accessed here