From the Brussels office

Payment services: Commission proposals

On 24 July, the Commission presented its proposal for a new directive on payment services (PSD2), and a proposal for a regulation on interchange fees for card-based payment transactions. The revised PSD2 will amend the previous directive of 2007.

The new directive aims to create higher levels of security, improve consumers’ protection to combat fraud and abuse, and to promote the introduction of innovative, low-cost payment services, mainly internet based.

A cap is proposed on fees for transactions involving consumer debit and credit cards, together with a ban on surcharges on these types of cards. Interchange fees are charged by card companies to retailers, who in turn pass on the cost to the consumer. Surcharges are additional charges imposed by some retailers when using certain payment cards. It is hoped the proposals will benefit the consumer and drive retail prices down. Parliament and Council will start work on the proposals after the summer recess. Since the Commission released the proposal, there has been a mixed reaction from consumer bodies.

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The UK Law Societies’ Brussels office provides up-to-date intelligence on EU developments, offers advice to firms wishing to engage with the EU institutions, and acts as the voice of the solicitors’ profession to the EU institutions.

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