Antitrust Investigations Underway in Poland and the Netherlands
According to reports by Reuters and the Financial Times, banks in both Poland and the Netherlands are currently under investigation by the EU for potential antitrust violations. On the morning of October 3rd, officials from the Brussels office conducted unannounced checks of the banking association headquarters in both countries. These checks come as preliminary notices of the commission’s intent to enforce the newest EU regulations on the retail banking sector, due to come into full effect in 2018.
These regulations (Revised Payment Service Directive), described succinctly as a “headache for everyone” by an unnamed RBS FinTech analyst, incentivize participation in retail banking by nontraditional players, including Amazon, Facebook, and FinTech-specific startups. After they come into full effect, EU consumers will have the option to authorize the third-party use of their banking data for transaction purposes. One of the greatest concerns of this new development is that of security, especially in the wake of the massive Equifax breach. Executives at various firms are concerned that, as consumer information is disbursed rather than remaining centrally located at one bank, differing security practices will open up data to theft and other forms of misuse.
Polish and Dutch banking associations are allegedly pushing back in their actions as well. The concern is that member institutions are acting in a “cartel-like” manner according to one official, blocking legitimate and authorized access in an attempt to keep their stranglehold on the industry. The fear is that this new approach to transactions will encourage a “shop-around” mentality, driving down prices and reducing profit margins of established players.
A statement by the commission alleged that the associations’ “anti-competitive practices are aimed at… preventing them from gaining access to bank customers’ account data, despite the fact that…(customers) have given their consent to such access”. It is important to note, however, that these investigations are not declarations of guilt.
The commission publicly reaffirmed its commitment to the defense rights of these banking associations and will provide ample opportunity to do so in antitrust proceedings. Both the Polish and Dutch associations are reportedly “cooperating fully”.