The Justice Department has filed a civil antitrust lawsuit against Visa, accusing the company of monopolization and other unlawful conduct in debit network markets. The suit, filed in the U.S. District Court for the Southern District of New York, claims that Visa violates Sections 1 and 2 of the Sherman Act by maintaining its monopoly over debit network markets.
The complaint states that more than 60% of debit transactions in the United States are processed through Visa’s network, generating over $7 billion annually in fees. It alleges that Visa uses its dominance to impose exclusionary agreements on merchants and banks, penalizing those who use alternative networks or payment systems. These practices are said to insulate Visa from competition and suppress smaller competitors.
“We allege that Visa has unlawfully amassed the power to extract fees that far exceed what it could charge in a competitive market,” said Attorney General Merrick B. Garland. “Merchants and banks pass along those costs to consumers, either by raising prices or reducing quality or service. As a result, Visa’s unlawful conduct affects not just the price of one thing – but the price of nearly everything.”
Debit transactions play a significant role in the U.S. financial system, with millions relying on them for purchases. The lawsuit contends that Visa's actions have led to billions in additional fees for American consumers and businesses while stifling innovation.
“Anticompetitive conduct by corporations like Visa leaves the American people and our entire economy worse off,” said Principal Deputy Associate Attorney General Benjamin C. Mizer. “Today’s action against Visa reminds those who would stifle competition rather than competing on price or investing in innovation that the Justice Department will never hesitate to enforce the law on behalf of the American people.”
“Visa fears competition and innovation, and instead chooses unlawful cooperation and monopolization,” added Principal Deputy Assistant Attorney General Doha Mekki of the Justice Department’s Antitrust Division. “Visa abuses its power over its customers and buys off would-be rivals at the expense of American consumers, merchants, banks, and the competitive process itself."
In 2020, a similar lawsuit was filed by the Justice Department to prevent Visa from acquiring Plaid, a technology company developing disruptive options for online debit payments. That merger was abandoned.
Visa Inc., headquartered in San Francisco, reported a global operating income of $18.8 billion with an operating margin of 64% in 2022. North America remains one of its most profitable regions with an operating margin of 83%. Annually, Visa charges approximately $8 billion in network fees on U.S. debit volume.
