UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF NEW YORK

UNITED STATES OF AMERICA,

U.S. Department of Justice
Antitrust Division
450 Fifth Street, NW, Suite 4000
Washington, DC 20530,

COMPLAINT
Plaintiff,
1:24-cv-7214
v.

VISA INC.,
One Market Plaza
San Francisco, CA 94105,

Defendant.
 Table of Contents

I. Introduction .......................................................................................................................... 4
II. Nature of The Case .............................................................................................................. 6
III. Debit Transactions ............................................................................................................. 12
A. Overview of Debit Transactions......................................................................................... 13
B. Debit Networks................................................................................................................... 17
1. Issuers Select Which Networks Are Enabled on a Debit Card ...................................... 17
2. How Debit Networks Get Paid ....................................................................................... 18
3. U.S. Debit Network Evolution Helped Visa Obtain Dominance ................................... 19
4. PIN Networks Lack Scale and Meaningful Opportunities to Compete for Debit
Transactions ................................................................................................................... 22
5. Alternative Debit Networks ........................................................................................... 24
IV. Visa Systematically Dominates Debit Transactions IN the United States Through
Exclusionary and Anticompetitive Conduct .................................................................... 25
A. Visa Has Been the Largest, Most Powerful Debit Network for Over a Decade ................ 25
B. Visa Entered into a Web of Contracts to Hinder PIN Networks from Competing ............ 27
1. Visa’s Contracts with Merchants and Acquirers Unlawfully Inhibit Competition and
Stifle Innovation............................................................................................................. 28
2. Visa’s Contracts with Issuers Unlawfully Restrict the Growth of Its Debit Competitors
........................................................................................................................................ 33
3. Visa’s Response to the Durbin Amendment Successfully Protected Its Monopoly from
Competition.................................................................................................................... 36
4. Visa Uses Its Monopoly Power to Deprive Its Rivals of Scale ...................................... 37
C. Visa Uses Its Monopoly Power to Squash Innovative Alternatives to Its Debit Network . 40
1. Visa Fears that Fintech Debit Networks Will Disintermediate Its Lucrative Debit
Business ......................................................................................................................... 42
2. Visa Leveraged Its Debit Monopoly to Prevent PayPal and Others from
Disintermediating Visa with Staged Digital Wallets ..................................................... 45
3. Visa Uses Its Leverage Over Its Potential Debit Competitors, Including Apple, Paying
Them Not to Create or Promote Competitive Products ................................................. 49
V. Anticompetitive Effects ..................................................................................................... 51
VI. No Countervailing Factors ................................................................................................ 54
VII. The Relevant U.S. Debit Markets ..................................................................................... 54

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 A. The United States Is a Relevant Geographic Market ......................................................... 55
B. Relevant Product Markets .................................................................................................. 55
1. General Purpose Debit Network Services Are a Relevant Product Market ................... 55
2. General Purpose Card-Not-Present Debit Network Services Are a Relevant Product
Market ............................................................................................................................ 59
VIII. Visa Has Monopoly Power in the U.S. Debit Markets.................................................... 60
IX. Jurisdiction, Venue, and Commerce ................................................................................ 63
X. Violations Alleged .............................................................................................................. 64
A. First Claim for Relief: Monopolization of the Markets for General Purpose Debit Network
Services and General Purpose Card-Not-Present Debit Network Services in the United
States in Violation of Sherman Act § 2 .............................................................................. 64
B. Second Claim for Relief: Attempted Monopolization of the Markets for General Purpose
Debit Network Services and General Purpose Debit Card-Not-Present Debit Network
Services in the United States in Violation of Sherman Act § 2 ......................................... 65
C. Third Claim for Relief: Unlawful Agreements Not to Compete in Violation of Sherman
Act § 1 ................................................................................................................................ 66
D. Fourth Claim for Relief: Unlawful Agreements that Restrain Trade in Violation of
Sherman Act § 1 ................................................................................................................. 67
XI. Request for Relief............................................................................................................... 68

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I. INTRODUCTION

Each year, Americans depend on debit cards to buy more than $4 trillion worth of

groceries, clothing, and other goods and services. Millions of Americans, including many lower-

income consumers who lack easy access to credit, use debit cards to pay for purchases directly

from their bank account. While Americans rely on debit transactions for the necessities of life,

most are unaware of the networks that drive those transactions. Nor are they aware that one

company, Visa, has for monopolized debit transactions; penalized industry participants that seek

to use alternative debit networks; and coopted innovators, technology companies, and financial

institutions to forestall or snuff out threats to Visa’s debit network dominance.

Visa owns and controls a debit network that connects the consumers’ and the merchants’

banks. In the United States, more than 60% of debit transactions run on Visa’s debit network,

allowing it to charge over $7 billion in fees each year for processing those transactions. Visa

earns more in revenue from its U.S. debit business than its credit business as of 2022. Visa debit

is core to its North American business, where Visa enjoys operating margins of 83%. But even

these numbers understate Visa’s monopoly power over debit transactions.

Visa maintains its dominant position not by competing on a level playing field but by

insulating itself from competition through exclusionary and anticompetitive means. Visa uses its

size, scale, and centrality to the debit transaction ecosystem to penalize those who would switch

to a different debit network or to companies that could develop alternative debit products. It uses

its dominance to limit the growth of existing competitors and to deter others from developing

new and innovative alternatives.

When that stick is not enough, Visa offers a carrot: extra payments to entice potential

competitors to partner instead of innovate. As Visa’s CFO emphasized, “[E]veryone is a friend

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and a partner. Nobody is a competitor.” Such inducements are worth Visa’s while too. Even

though the choice to make such payments reduces Visa’s immediate profits, it nonetheless pays

hundreds of millions of dollars to would-be competitors to blunt the risk they develop innovative

new technologies that could advance the industry but would otherwise threaten Visa’s monopoly

profits.

This conduct cuts off competition where it should occur today. Perniciously, it also

prevents its current and potential rivals from gaining the scale, share, and data necessary to erode

Visa’s existing dominance.

Visa profits from its monopoly by collecting a higher fraction of each debit transaction

than it would if it faced competition. Visa’s schemes are largely invisible to consumers, in part

because its debit transaction fees make up a relatively small fraction of each transaction, but total

to billions of dollars annually. Collectively, however, Visa’s systematic efforts to limit

competition for debit transactions have resulted in significant additional fees imposed on

American consumers and businesses and slowed innovation in the debit payments ecosystem.

As Visa’s internal documents make clear, Visa feared a future where newer, better, or

cheaper alternatives would force Visa to compete harder to win customers’ business or, worse,

displace Visa with alternatives to its debit network. Without intervention, Visa will continue to

insulate itself from competition and subvert the competitive process in this essential industry that

fuels U.S. commerce, all the while enriching itself at the expense of the American people who

ultimately bear the brunt of Visa’s unlawful monopoly and the lack of competition its conduct

has wrought.

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II. NATURE OF THE CASE

1. Americans use their debit cards billions of times every year to buy goods and

services from merchants. Debit cards comprise an increasingly large percentage of all

transactions between consumers and merchants. Consumers can use their cards for purchases at

brick-and-mortar stores (card-present or CP transactions) and online (card-not-present or

CNP transactions).

2. Debit transactions include several actors, including the consumers seeking to use

their debit card to make a payment, merchants who accept debit, and their respective banks.

3. For all of these debit transactions to work, the consumer’s bank must connect to

the merchant’s bank. Over the entire economy, that means thousands of banks on the consumer

side must communicate with all of the banks on the merchant side.

4. For a debit network to process a transaction, both the bank issuing the card to the

consumer (the issuing bank or issuer) and the merchant’s bank that acquires the payment (the

acquiring bank or acquirer) must be part of the network. Issuers decide which networks to

place on their debit cards, while merchants decide which networks they will accept and which

they will choose to use for a given transaction. A network can compete for a transaction only if it

connects to both the issuer and the acquirer.

5. As a result, debit networks face what Visa calls “a chicken-and-egg problem.” To

be successful, the network needs many issuers and acquirers to accept the network. But issuers

are unlikely to join the debit network unless many merchants already use the network. And

merchants are unlikely to join the network unless their customers have cards that work with the

network, which requires the issuer to have activated the network. As Visa itself observes,

“build[ing] scale on both sides. . . with consumers/payers and with merchants/payees” is “a

6
herculean task.” Visa further recognizes that these effects create “an enormous moat” around its

business.

6. Visa’s market shares demonstrate just how deep that moat is. Visa has been the

largest debit network in the United States for decades. Today, over 60% of all U.S. debit

transactions run via Visa’s payments network. And Visa’s share of card-not-present debit

transactions exceeds 65%. Mastercard is a distant second, processing less than 25% of all U.S.

debit transactions and card-not-present U.S. debit transactions. Other networks, known as “PIN

networks” because they originally facilitated ATM transactions for which accountholders

needed to enter a PIN, are significantly smaller.

7. This moat is no accident. Coming out of the Great Recession, Visa identified two

significant threats to its monopoly—one from legislation and one from emerging technology.

Visa took steps to counter both, enriching itself handsomely in the process.

8. In 2010, Congress passed the Durbin Amendment, which became law as part of

the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. No. 111-203,

124 Stat. 1376 (2010). The Durbin Amendment requires issuing banks to include at least two

debit networks on every debit card—one on the front of the card and at least one on the back of

the card—that are not affiliated with each other (known as the front-of-card and back-of-card

networks, respectively). This requirement would help promote competition in the debit industry

by providing more merchant choice for debit routing.

9. Visa understood the competitive threat this development created. If banks

connected more cards to rival debit networks, Visa feared this could create a “tipping point” that

would result in its smaller rival debit networks gaining the scale they need to compete, which

would cause Visa to lose substantial volume, and therefore, fees. Indeed, in 2012, after the

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Durbin Amendment became effective, Visa initially lost volume to other debit networks that

offered lower fees. If this trend had continued—that is, if competition had continued to grow—

Visa likely would have lost its dominant position and power. But instead, Visa used its dominant

position in the debit market to limit competition.

10. There are a substantial number of debit transactions that Visa owns outright

without facing any competition. Such transactions are non-contestable by rival networks. For a

number of reasons, Visa may be the only network available for both the merchant and issuer to

use for these transactions. For these non-contestable transactions, Visa does not face meaningful

competitive constraints and can threaten merchants with high rates that merchants would have to

accept.

11. But for the rest of the transactions, the merchants that sell to consumers could

choose between Visa and alternative debit networks enabled by the accountholder’s bank. The

forces of competition from those other networks should in turn lower fees and spur innovation.

Visa knows, however, that its significant volume of non-contestable transactions gives it

leverage to subvert the forces of competition. These non-contestable transactions are necessary

and valuable to the merchants.

12. Visa offers a modern-day Hobson’s choice. Visa leverages its control over non-

contestable transactions and extracts routing deals that limit competition for contestable

transactions. Absent a routing agreement, the merchant or acquirer pays a list price (known in the

industry as the rack rate) on any transaction that is routed to Visa’s debit network.

Alternatively, the merchant (or acquirer) signs an agreement with Visa and receives a so-called

“discount” on all transactions, both non-contestable and contestable. Visa threatens punitive rack

rates if merchants (or their acquirers) route a meaningful share of their transactions to Visa’s

8
competitors. Other debit networks cannot compete for non-contestable transactions as they often

struggle to compete for any meaningful share of transactions involving a merchant subject to a

Visa routing deal. And merchants suffer if they do not accept Visa’s agreement.

13. In 2014, Visa told its Board of Directors that these routing deals with the largest

issuers and acquirers allow Visa “to stabilize [its] volume.” Visa’s routing contracts cover more

than 180 of its largest merchants and acquirers, and effectively insulates at least 75% of Visa’s

debit volume from competition—which means that Visa has foreclosed nearly half of total U.S.

debit volume. Internally, Visa touts the success of its routing deals in limiting competition. Visa

renewed many of its routing agreements in 2022 to deepen its debit moat for years to come.

14. In addition to frustrating the goal of the Durbin Amendment, Visa took steps to

insulate itself from competition from emerging technologies. Visa recognized how innovative

technologies could develop new ways for consumers to make debit payments and topple Visa’s

control of debit transactions. Visa knew that several digital platforms, including Apple, PayPal,

and Square, have large existing networks that connect merchants and consumers, and offer

payment products to consumers. Consumers value the payment products offered by these digital

platforms, which allow consumers to link their debit card credentials to Apple Pay, PayPal, Cash

App or other payment products, and make purchases in more convenient and efficient ways.

15. Visa feared that these digital platforms may have “network ambitions,” and might

seek to eliminate Visa and other debit networks as links between consumers and merchants for

debit transactions. Visa saw Apple Pay, for an example, as an “existential threat” to its debit

business.

16. Recognizing the threat they posed, Visa’s strategy has been to “partner with

emerging players before they become disruptors.” To do so, Visa structures its deals with

9
potential competitors to dissuade them from competing. Visa offers lucrative incentives,

sometimes worth hundreds of millions of dollars annually, to these potential competitors under

the express condition that they do not develop a competing product or compete in ways that

could threaten Visa’s dominance. In addition to the carrot of these incentives, Visa has also

threatened to use the stick of additional fees to dissuade their potential competitors’ innovation—

if they develop competing products.

17. Through this anticompetitive conduct, Visa has harmed competition in the

relevant debit markets in at least three ways.

18. First, Visa takes advantage of its must-have status to exercise its monopoly power

and deny a level playing field for its rivals and deprive them of scale. Visa is capable of this

conduct because Visa-branded cards comprise a large portion of all U.S. debit cards. Further,

merchants must use Visa’s network for a significant number of non-contestable transactions.

19. Second, Visa’s conduct forecloses competition in a substantial portion of the

relevant debit markets—at least 45% of all U.S. debit transactions and over 55% of card-not-

present debit transactions.

20. Visa’s conduct subverts the competitive process. Visa deprives its smaller rivals

of the scale they need to compete effectively on both price and quality. Networks need scale on

both the issuer and merchant sides of the market to compete effectively; the lack of scale on one

side makes it hard to build scale on the other. Visa’s agreements with issuers on the one hand

and merchants and acquirers on the other exacerbate its rivals’ scale problems on both sides of

the market. Today, the non-Visa/Mastercard-owned networks collectively represent only about

11% of all debit transactions and only about 5% of card-not-present debit transactions.

10
 21. Third, Visa has already secured commitments from several large would-be

competitors that they would not unveil products that could threaten Visa’s dominance. Rather

than engage in fulsome competition, Visa’s agreements with these companies, including Apple,

PayPal, and Square, have succeeded in transforming these potential competitors into partners to

the detriment of competition from those would-be rivals and Visa’s own incentives to innovate,

and at the expense of American consumers and American merchants of all sizes.

22. Visa’s actions deny Americans the benefits of competitive markets for debit

transactions. Visa, one of the most profitable companies in the United States, has succeeded so

thoroughly in insulating itself from competition that it is now earning outsized profit margins

from its role as a dominant intermediary—a digital middleman—at the center of the debit

transaction market. American merchants large and small ultimately pay much of these fees. In

turn, they may raise prices to consumers or may absorb the cost by offering fewer products or

lower quality. Issuers are also subject to Visa fees and may pass them through to consumers.

Regardless of who pays Visa’s supracompetitive prices in the short term, over the long run, these

tolls are ultimately borne by the American consumer, American merchants, and the broader

economy.

23. Plaintiff United States of America brings this action under Sections 1 and 2 of the

Sherman Act, 15 U.S.C. §§ 1, 2, to put a stop to Visa’s exclusionary and anticompetitive

schemes, unfetter the markets of Visa’s unlawful monopoly, remedy the harm Visa has caused,

deny Visa the fruits of its statutory violations, and prevent the recurrence of these violations of in

the future.

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III. DEBIT TRANSACTIONS

24. Debit transactions are a kind of financial transaction whereby funds are drawn

directly from a consumer’s bank account to pay a merchant for goods or services. Consumers can

use debit transactions in various ways, including to buy goods at retailers or to pay bills online.

25. Debit cards have existed in the United States since the 1960s, when banks began

to innovate ways for their customers to access funds in their bank accounts. Automated teller

machines (ATMs) allowed consumers to withdraw those funds with a debit card that was issued

by the consumer’s bank. Over time, some debit cards began to support purchases at retailers.

Debit cards gained wider adoption by the 1990s when merchant acceptance of debit grew, and

consumers demanded more convenient alternatives to cash and checks to withdraw money from

their bank accounts. Over time, consumers increasingly favored debit transactions for their

convenience and security, and retailers increasingly accepted them, leading debit card usage to

grow substantially in the United States.

26. Today, debit transactions are an important and popular payment method within

the U.S. financial system. Unlike most other kinds of financial transactions, debit transactions

immediately authorize the deduction of funds from a consumer’s bank account balance.

27. Tens of millions of Americans prefer to use or must rely on debit to pay for online

and in-person purchases. This is despite the fact that accountholders rarely earn rewards when

using their debit cards, unlike when they use credit cards. Consumers who prefer debit include

those who do not want to use or are unable to obtain credit cards; those who have limited credit

available to them; those who prefer to avoid the lending dynamics of a credit card (e.g., the risk

of debt accumulation, credit card fees, and charged interest); those who prefer the spending

12
discipline of using only funds that are available in their bank account; and those that prefer the

convenience of debit over cash and checks.

A. Overview of Debit Transactions

28. Debit is a way for consumers to purchase goods and services from merchants

using a number directly tied to their bank accounts.

29. Debit transactions are made possible by debit networks, the technological and

communications infrastructure that facilitates secure, real-time payment transactions between

and among businesses, merchants, and consumers from their respective bank accounts.

30. In the United States, the most common way consumers make debit purchases is

by using a general purpose debit card issued by their banks. As defined in Section VII infra,

general purpose means that the debit card can be accepted at numerous, unrelated merchants.

Visa, like most other debit networks, does not issue these general purpose debit cards to

accountholders. Instead, debit networks like Visa typically contract with the consumer’s bank

(referred to as the issuing bank or issuer1) to issue the debit cards. Debit networks like Visa

typically contract with the merchants’ banks (referred to as the acquiring bank or acquirer2) so

that merchants can accept debit cards. Debit networks are the way that thousands of issuers on

the one hand connect with each of the acquirers and their millions of merchants on the other

hand.

31. The debit network’s product is simple. It includes a debit credential or other

account identifier unique to the consumer that can be accepted at all merchants that participate in

1
The issuing bank may work with an issuer processor, which connects the issuer with the network and provides
various services such as managing card issuance, authorizing or declining transaction, and communicating with
settlement entities. For ease of reference, the use of the term issuer refers to both issuing banks and issuer
processors.
2
The acquiring bank may work with an acquirer processor, which sends transaction information to the network on
behalf of the acquirer. For ease of reference, the use of the term acquirer refers to both acquiring banks and acquirer
processors.

13
the network, payment guarantees for the merchant, the ability for a consumer or her bank to

dispute and chargeback the transaction, fraud protections to all parties, and the “rail” or methods

by which the merchants’ and consumers’ banks communicate between each other to facilitate the

transaction and the transfer of funds.

32. Notably, banks rather than debit networks ultimately move money from

consumers to merchants. But debit networks play an important role in the process: they clear and

oversee the interbank settlement process by aggregating all transactions each day for each bank

in their systems, netting out applicable fees, and providing banks with daily settlement reports.

These settlement reports are used by the banks to transfer funds among themselves, typically

using a wire service available only to banks.

33. Debit networks also set the rules for transactions flowing through the network. As

the largest debit card network in the United States, Visa leverages its intermediary role not only

to set rules for transactions on its own network but also to influence the rules for all other debit

networks.

34. Debit cards can be used in-person or online to make purchases from money in the

consumer’s bank account using a debit card credential. As illustrated in Figure 1 below, debit

card credentials include several pieces of information: a 16-digit card number (known as the

debit card number) that is usually found on the front of the debit card and other security features

such as the expiration date, card verification value (CVV), an EMV security chip, and a four-

digit PIN. The card will also graphically identify the “front-of-card” and may graphically

identify the “back-of-card” networks. As further described herein, while debit cards may be

enabled to process transactions over multiple networks, today, few include more than two

14
unaffiliated networks: the front-of-card network and one back-of-card network unaffiliated with

the front-of-card network.

Figure 1

35. A debit transaction starts when a consumer presents his debit credentials to a

merchant to pay for a purchase. First, the merchant sends a request to its acquirer. Theoretically,

the merchant has a choice to use the front-of-card network (which is Visa for approximately 70%

of debit card payment volume) or a back-of-card network. But as discussed infra, this choice is

illusory —merely theoretical—and the merchant’s routing decision defaults to Visa due to Visa’s

exclusionary and anticompetitive conduct. In all events, the merchant’s bank (the acquirer) sends

the consumer’s account and transaction information to a debit network (e.g., Visa) to process the

transaction for authorization, clearing, and settlement. The debit network, in turn, requests

authorization from the consumer’s bank (the issuer) to approve the transaction. The issuer will

typically authorize the transaction if the consumer has a sufficient account balance to fund the

15
transaction and, in many cases, there are no indications of fraud. If the transaction is authorized,

the issuer places a hold on the consumer’s funds and sends the authorization response back over

the debit network to the acquirer, minus the interchange fee (a fee paid by the acquirer to the

issuer). In the final step, the acquirer transmits the authorization response to the merchant,

allowing the merchant to complete the transaction. At the same time, Visa collects a myriad of

fees from the tens of billions of debit transactions that happen each year.

Figure 2

36. For most debit card transactions, this process happens in a matter of seconds,

which allows debit cards to facilitate transactions between accountholders and merchants

efficiently. American consumers are often unaware of how money is allocated among merchants,

debit networks, processors, and financial institutions that participate in these transactions.

37. There are slight differences in the mechanics of debit transactions depending on

whether the debit card is physically present. Using debit in person at a merchant is referred to as

a card-present transaction. If a consumer uses a debit credential on a website, in an app, or over

the phone, the transaction is referred to as a card-not-present transaction. Today, card-not-present

debit transactions make up about half of all debit spending, a dramatic increase since 2010. This

16
number is growing. For card-not-present transactions, the accountholder either manually enters

her debit credentials or relies on debit credentials stored in a digital wallet, such as Google Pay,

Apple Pay, or PayPal. Unlike card-present transactions, for card-not-present transactions,

merchants can almost never prompt consumers to enter a PIN. Instead, security features, such as

multi-factor authentication, help improve the security of card-not-present transactions.

B. Debit Networks

1. Issuers Select Which Networks Are Enabled on a Debit Card

38. In the United States, debit cards typically must have at least two debit networks: a

front-of-card network and at least one back-of-card network that is unaffiliated with the front-of-

card network. Issuers (consumers’ banks) select one front-of-card network and choose which

back-of-card networks to enable. The front-of-card networks’ branding is typically displayed on

the debit card (in addition to the issuer’s branding). The branding of the back-of-card networks

may not appear on the debit card.

39. As a practical matter, a consumer’s debit network is frequently selected for her—

by the bank where she opens her checking account.

40. Visa is the dominant front-of-card network, Mastercard is the distant second

front-of-card network, and two much smaller players account for the remainder. Issuers rarely

change their front-of-card network due, in part, to significant switching costs, such as the costs of

re-issuing new debit cards to accountholders. Visa has secured long-term contracts with many

issuers. Visa knows that Mastercard and other debit networks have little opportunity to displace

Visa as the front-of-card network for those banks.

41. Visa-branded debit cards (cards that feature Visa on the front of the card) will

often include Interlink, Visa’s back-of-card network, and at least one additional back-of-card

17
network that is not affiliated with Visa. Examples of such unaffiliated back-of-card networks

include Mastercard’s Maestro or a smaller debit network such as STAR, NYCE, or Pulse. These

smaller debit networks are sometimes referred to as PIN networks due to their growth from ATM

networks where an accountholder would enter their four-digit PIN to withdraw cash funds.

Mastercard-branded debit cards typically include Maestro and at least one additional back-of-

card network that is unaffiliated with Mastercard.

42. Issuers decide whether to enable the back-of-card networks to process particular

debit transactions on the issuers’ debit cards. For example, issuers may not enable back-of-card

networks, for a card-present transaction where a PIN was not entered. As discussed in Section IV

infra, despite their presence on many debit cards, PIN networks have been unable to gain a

meaningful share of debit transactions, in part due to Visa’s exclusionary and anticompetitive

conduct.

2. How Debit Networks Get Paid

43. Bank accountholders do not pay debit networks directly to use their payment

networks. To make money, debit networks like Visa impose network fees on both issuers and

acquirers for every debit transaction. As a general matter, there are two types of acquirer fees:

per-transaction fees and fixed fees. The merchant’s acquirer pays Visa a network fee for each

transaction on Visa’s network. The amount of the network fee varies based on the type of

transaction, such as whether the accountholder enters a PIN or whether it is a card-present or

card-not-present transaction. Starting in 2012, Visa also began charging each merchant’s

acquirer a fixed monthly fee, known as the Fixed Acquirer Network Fee (FANF), based on

factors like the number of locations operated by the merchant and the volume of the merchant’s

card-not-present transactions.

18
 44. In addition, the acquirer also pays a per-transaction fee to the issuer—known as

an interchange fee—that is payment to the issuer for its services. For the largest issuing banks

with $10 billion or more in assets, the interchange fee amount is capped by the Federal Reserve.

For smaller issuers, the debit network (e.g., Visa) sets the amount of the interchange fee.

45. The acquirer’s customer, the merchant, ultimately pays at least some of the fees

incurred by the acquirer. The merchant also pays a fee to the acquirer for the acquirer’s services.

For most transactions, Visa’s network fees are significantly higher than those of the PIN

networks.

3. U.S. Debit Network Evolution Helped Visa Obtain Dominance

46. Beginning in the 1960s, the first debit networks in the United States started as

ATM networks. Banks issued ATM cards to their accountholders so they could easily withdraw

funds from their accounts. To use these cards, accountholders could enter a 4-digit number

(known as the PIN) at an unattended ATM rather than approach the bank’s counter to provide a

signature.

47. Merchants appreciated the elimination of checks and started installing PIN pads to

enable more accountholders to use their ATM cards at the point of sale. Accountholders also

became more comfortable carrying a physical card for purchases. With increased enablement

across cities and geographic regions, these ATM networks, including STAR, NYCE, and Pulse,

evolved to become the PIN networks.

48. Only later, after the first introduction of ATM cards, did Visa and Mastercard

began to build their front-of-card debit products off of their dominant credit card infrastructure.

As debit emerged, Visa and Mastercard were each joint ventures owned and controlled

exclusively by their member banks, which comprised virtually all U.S. banks. Visa leveraged the

19
scale afforded by its member banks to jump start its debit business. When Visa launched its

point-of-sale debit product, the Visa Check Card, in the 1990s, it was quickly able to scale

among its member banks, which issued debit cards with the Visa logo. Unlike the PIN networks,

which processed debit cards over rails designed for ATM networks, Visa processed

accountholders’ debit purchases over Visa’s existing credit card rails. Visa and Mastercard

already had access to an existing base of merchants who accepted Visa and Mastercard credit

cards. This eased the way for Visa and Mastercard to roll out widely usable debit cards,

especially as Visa’s network rules initially mandated merchants accept both its credit and debit

products. By working with issuers to add Visa’s credit processing infrastructure to the issuers’

installed base of ATM cards, Visa was able to quickly scale its debit offering.

49. Visa’s and Mastercard’s relationships with their respective issuers were exclusive

until the early 2000s, each prohibiting their issuers from issuing American Express or Discover-

branded credit and debit cards thereby impairing the growth of these smaller networks. The

Second Circuit found those restrictions were illegal under the antitrust laws and affirmed the

district court’s injunction against them in 2003, and shortly thereafter Visa and Mastercard

settled private litigation and agreed to allow merchants to have the ability to accept their debit

cards without accepting their credit cards, and vice versa. But Visa’s dominance had already

been cemented.

50. Between 2006 and 2008, both Visa and Mastercard became independent public

corporations, though banks continued to own significant stock in each of them. Although banks

were now free to choose to issue a mix of Visa-branded debit cards and other cards featuring

different networks, most banks chose to issue only Visa-branded debit cards or only Mastercard-

branded debit cards, with the two competing with each other for front-of-card placement. It was

20
challenging for Visa or Mastercard to displace the other as a bank’s chosen front-of-card

network, due to the expense and difficulty of issuing new cards to all accountholders. It was also

rare for any network other than Visa or Mastercard to win front-of-card placement because of the

large base of merchant acceptance; other networks did not have the same scale of existing

merchant relationships. Banks often chose to feature only one network—the front-of-card

network—on debits cards they issued, meaning that merchants could not choose any network

other than the front-of-card network for routing a particular transaction.

51. That practice ended for issuers of Visa and Mastercard debit cards in 2012 after

Congress passed the Durbin Amendment. The Durbin Amendment required each debit card to

support at least two unaffiliated networks. In other words, issuers had to enable at least one

unaffiliated back-of-card debit network as a competitor to the front-of-card brand (i.e., Visa or

Mastercard), somewhat improving routing choice for many merchants accepting debit.

52. The Durbin Amendment also set maximum limits on the interchange fees that

merchants and their banks pay regulated issuers (banks with more than $10 billion in assets) for

every debit transaction. The interchange cap has a no-evasion rule, which limits a network’s

ability to provide incentives to issuers by paying them more than the cap. These limits on

incentives made it even more challenging for Mastercard or other networks to win front-of-card

placement where Visa was the incumbent network because they often could not fully compensate

the issuer for its switching costs.

53. Today, Visa is the largest debit card network in the United States. It eclipses its

smaller rival Mastercard, which has not been able to gain significant share from Visa or restrain

Visa’s monopoly. Visa is the front-of-card brand for over 70% of the debit card payment volume

in the United States. Mastercard, by contrast, is the front-of-card brand for around 25% of debit

21
card payment volume, with American Express and Discover comprising the front-of-card brand

on a much smaller number of debit cards. As Visa’s former Head of Product North America has

explained, Visa has “dominance on the front of card.”

4. PIN Networks Lack Scale and Meaningful Opportunities to Compete

for Debit Transactions

54. For a debit network to have a chance to win a transaction, it must be placed by the

issuer somewhere on the debit card it issues. Even if a network is on a card, it may be ineligible

for certain transaction types unless each party to the transaction—the issuer, the acquirer, and the

merchant itself—has enabled the debit network to process the particular transaction type.

55. To compete effectively, however, a debit network also needs sufficient scale on

both the issuer and merchant sides of the debit market. The desirability and effectiveness of a

debit network depends on the breadth of its acceptance and enablement by all the network

participants—accountholders, issuers, acquirers, and merchants. For example, the more issuers

that place a network on a card, and therefore, the more accountholders who may present the debit

network for payment, the more likely it is that merchants will accept the network, and vice versa.

This feedback loop is known as network effects. For Visa, this is not a problem: it is the default

routing option when Visa is the brand on the front of the debit card. As described earlier,

however, a Visa executive has recognized that for smaller PIN networks and potential

competitors, building scale on both sides of the market can be a “herculean task.”

56. Despite their smaller size, PIN networks have continued to innovate. While still

referred to in the industry as “PIN” networks, they have since developed capabilities to process

debit transactions without requiring a consumer to enter a PIN (referred to as PINless debit

transactions). While PIN networks require PIN entry after consumers swipe or tap their cards,

22
PINless technology allows these networks to process card-not-present transactions, such as

online purchases, and in-person transactions in which the consumer does not enter a PIN.

57. Despite these investments, Visa imposes contractual rules and terms in its

merchant and acquirer agreements that, as a practical matter, require merchants to route the vast

majority of their debit transactions to Visa, rather than back-of-card networks, which include the

PIN networks, none of which has double-digit market share, and Mastercard’s Maestro. Visa’s

dominance, its exclusionary rules, and the small size of the PIN networks mean that each PIN

network can compete for only a tiny fraction of all debit transactions. Visa’s contracts with

merchants and acquirers lock up volume, depriving rivals of scale and limiting routing choices

artificially.

58. Some transactions must be routed to Visa and are not available to its back-of-card

competitors under any circumstances. These transactions are non-contestable because those

back-of-card networks are not available for particular transaction types, such as transactions over

a certain dollar amount or transactions that fail to meet particular encryption criteria. Card-

present transactions may be non-contestable if the issuer does not allow the network to process

card-present PINless transactions and the network’s PIN option is unavailable because the

merchant chooses not to prompt customers to enter a PIN. Moreover, acquirers may not enable

smaller PIN networks. Card-not-present transactions may be effectively non-contestable if they

are tokenized, an encryption technology used to facilitate some Visa-branded debit card

transactions initiated online, in a mobile app, or with a digital wallet. Indeed, only a tiny fraction

of card-not-present tokenized transactions were routed over an unaffiliated networks’ rails in

2023. Non-contestable transactions comprise a significant percentage of Visa-branded debit card

transactions. This is in part due to issuers historically not enabling card-not-present PINless

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transactions—at times at Visa’s prompting—which had deterred merchants and acquirers from

enabling card-not-present PINless acceptance.

59. Merchants feel they must accept Visa or they will lose a substantial number of

sales and consumers. Because of the large number of consumers using Visa-branded cards,

nearly all merchants must accept Visa, which in turn requires nearly all merchants to route at

least the non-contestable transactions to Visa instead of the often less costly back-of-card

networks.

5. Alternative Debit Networks

60. Although debit cards are the most common way to make a debit purchase in the

United States, other options exist. Other ways to make a debit purchase include alternative rails

developed by fintech firms (hereinafter fintech debit).

61. A fintech debit network can facilitate consumer-to-merchant payments by

providing end-to-end functionality equivalent to debit card networks: it authorizes payment from

a consumer’s bank account, facilitates communications with the consumer’s bank to authorize

and clear the transaction, and provides settlement services by initiating a payment to the

merchant’s financial institution. Alternative debit networks can complete this final transfer of

funds using money transfer services available to banks, such as the Automated Clearing House

(ACH) or Real Time Payment (RTP) networks, which are lower-cost alternatives to Visa’s

debit offering.

62. Visa recognizes that accountholders may one day remove Visa from its privileged

place as the dominant middleman between their bank account and the merchant. By combining

real-time money transfers with additional services—such as a credential that can be used at

merchants that are members of the network, payment guarantees, dispute capabilities, chargeback

24
capability, and fraud protection—the alternative debit networks could provide equivalent

functionality to debit card networks like Visa’s. Visa’s internal documents make clear that Visa

fears a world in which alternative debit networks mature and potentially take hold if fintechs

choose to pursue their “network ambitions.”

IV. VISA SYSTEMATICALLY DOMINATES DEBIT TRANSACTIONS IN THE

UNITED STATES THROUGH EXCLUSIONARY AND ANTICOMPETITIVE
CONDUCT

A. Visa Has Been the Largest, Most Powerful Debit Network for Over a Decade

63. Visa is one of the most profitable companies in the United States, with global

operating income of $18.8 billion and an operating margin of 64% in 2022. North America is

among Visa’s most profitable regions, with 2022 operating margins of 83%.

64. Visa’s U.S. debit business is its largest source of revenue globally. Visa charges

over $7 billion in network fees on U.S. debit volume annually, earning Visa $5.6 billion in net

revenue. In 2022, Visa earned more revenue from its U.S. debit business than from its U.S. credit

business, and more from its debit business in the United States than its debit business in any other

region in the world.

65. Visa’s incremental cost of each additional transaction on the Visa network is

“approximately zero.” As Visa’s former CFO put it, “the incremental transaction comes with little

incremental cost.” Moreover, Visa bears no financial risk for fraud. If someone uses a stolen debit

card to run up fraudulent purchases, for example, the merchant or the issuer bears the financial

risk—never Visa.

66. Despite regulatory changes, the rise of e-commerce and mobile payments, the

introduction of new technology, and an underlying product that is “increasingly viewed as a

commodity,” Visa’s high share of debit transactions has hardly budged in years. Visa’s rails still

carry over 60% of all debit transactions and 65% of all card-not-present debit transactions in the

25
United States while imposing supracompetitive prices, stabilizing prices, and depressing price

competition.

67. Visa is the front-of-card brand for over 70% of the debit card payment volume in

the United States. It is nearly three times the size of Mastercard, its next biggest rival, which is the

front-of-card brand for around 25% of debit card payment volume. No other competitor has more

than a single-digit share of front-of-card debit card payment volume. As Visa’s former Head of

Product North America has explained, Visa has “dominance on the front of card.”

68. The fees Visa charges to issuers tend to be smaller than those it charges to

acquirers. Issuers may avoid higher fees in exchange for taking actions that benefit Visa, as

further described in Section III.

69. Visa maintains its monopoly in debit both by preventing competitors from gaining

the necessary scale to challenge Visa and by co-opting would-be competitors. Visa preserves its

monopoly position against its smaller competitors by making it harder for them to develop scale

on both sides of the debit market: (1) merchants and their acquirers and (2) accountholders and

their issuers. For merchants and acquirers, Visa locks up their debit volume with de facto

exclusive deals that have the practical and economic effect of requiring exclusive routing. For

issuers, Visa pays them not to take actions that would make it possible for merchants and

acquirers to route to Visa’s rival PIN networks, such as enabling PINless routing. Broader issuer

enablement would reduce Visa’s leverage, make more transactions contestable by rival PIN

networks and, potentially, cause a tipping point for broader merchant enablement. For potential

competitors, such as digital platforms that contract with Visa, Visa requires or induces them to

agree not to introduce or support innovative alternatives to Visa’s traditional card-based debit

rails. The price of not signing a contract is high—Visa imposes onerous penalties. Those high

26
penalties ensure that virtually all these merchants, acquirers, issuers, and digital platforms choose

the deal with Visa.

B. Visa Entered into a Web of Contracts to Hinder PIN Networks from

Competing

70. Visa’s dominance today is the result of a meticulous strategy to lock up debit

volume to prevent competition at the point-of-sale. It is not an accidental historical artifact of its

large size or the result of competition on the merits, but instead the result of deliberate efforts.

Visa’s efforts effectively forestall competition from smaller debit networks (e.g., PIN networks)

and thwart government regulation implemented over a decade ago, which Visa has seen as

threats to its dominance.

71. This regulatory threat to Visa was the Durbin Amendment, which took effect in

2012. The Durbin Amendment sought to facilitate a minimum level of competition in a debit

system that had historically limited the choices of accountholders and merchants. The Durbin

Amendment attempted to foster competition by requiring all debit cards to support at least two

unaffiliated networks. In 2023, the Regulation II clarification adopted by the Federal Reserve

took effect, which sought to further promote debit competition and clarified that at least one

network unaffiliated with the front-of-card network on each card must be enabled for card-not-

present transactions.

72. In the years immediately following the passage of the Durbin Amendment, Visa

recognized that PIN networks, “outspoken merchants,” and other industry participants would use

the legislation to shift share away from Visa. According to its internal documents, Visa knew it

needed to act “quic[k]ly and decisively.”

73. Visa responded to the Durbin Amendment by exploiting others’ dependence on

Visa for certain transactions. Despite Congress’s efforts to facilitate competition, Visa

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understood that not all debit transactions can be routed to at least two unaffiliated networks.

Even with Durbin’s requirement for at least two unaffiliated networks on each debit card, Visa

has estimated that roughly 45% of Visa card-present transactions are non-contestable. For card-

not-present transactions, the numbers are even higher. Merchants and acquirers frequently have

only one option for routing a debit transaction: the front-of-card network, which on over 70% of

debit card payment volume means Visa. These captive transactions give Visa the power to

demand and enforce significant volume commitments.

74. Visa employs two reenforcing approaches to obtain the volume commitments.

First, it shares its monopoly profits to buy exclusivity. Second, Visa both charges punitively

expensive rack rates (listed pricing for network fees and interchange), which are divorced from

Visa’s incremental costs, to merchants or acquirers that refuse to sign routing agreements and

includes harsh penalties in its contracts with merchants and acquirers who do sign its agreements

but fail to achieve the exclusivity requirements.

1. Visa’s Contracts with Merchants and Acquirers Unlawfully Inhibit

Competition and Stifle Innovation

75. Most merchants face staggering financial penalties each year unless they route all

or nearly all eligible debit transactions to Visa, hindering PIN networks’ ability to compete and

frustrating one of the objectives of the Durbin Amendment. Visa ensures that most merchants

who route more than a small percentage of eligible debit transactions to alternative networks will

face higher fees on the non-contestable transactions.

76. Visa has signed routing contracts both directly with many large merchants and

with acquirers that control the routing decisions for merchants that do not have a direct

agreement with Visa. Visa pays for their loyalty and imposes harsh penalties if merchants and

acquirers fall short. Visa sometimes structures its contracts with merchants as a bid for a top

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position on the routing table— a ranked list that determines which network a given debit

transaction should be routed to, given the options available on the debit card used in the

transaction. Absent a commitment to grant Visa the number one position or other high placement

on the routing table, Visa threatens to charge the merchant high rack rates on all transactions

routed to Visa. This is effectively a cliff pricing structure, where meaningfully routing away

from Visa is yet again punished by the imposition of high rack rates. Dozens of merchants

representing hundreds of billions of dollars of 2023 debit payment volume have signed contracts

to route 100% of their eligible debit volume to Visa. For example, in 2023, Visa paid one large

merchant over $20 million for exclusivity. While Visa’s contracts with merchants and acquirers

include varying pricing terms, one almost universal constant is that the routing contracts contain

significant volume commitments.

77. Visa structures its routing contracts, in combination with its posted rack rates (i.e.,

list prices), to artificially increase the cost merchants and acquirers face if they route transactions

to a Visa competitor. In addition, in many routing contracts, failure to comply with Visa’s

volume requirements allows Visa to terminate the entire contract early and claw back as early

termination fees incentives that Visa had previously paid the merchant. Terminating the routing

contract may impact all the routing partner’s Visa payments volume, both debit and credit:

certain network fees covered by these contracts apply to both credit and debit transactions, and

Visa sometimes uses credit interchange discounts to win debit routing.

78. Visa’s routing contracts artificially increase the cost merchants and acquirers face

if they route transactions to a Visa competitor. Visa’s volume requirements are structured as cliff

pricing. Cliff pricing (sometimes called “all unit” pricing) grants the merchant or acquirer a

lower price for every transaction routed to Visa so long as its total volume of transactions

29
exceeds the committed threshold. If the merchant does not meet the commitment, Visa will

impose its high rack rates on all transactions routed to Visa. Visa insists on cliff pricing to

discourage merchants from routing to Visa’s competitors, denying them scale. In other words,

merchants and acquirers that make a routing commitment to Visa receive substantial network

fee, interchange, and cash concessions, but only if they meet their volume commitments. Absent

qualification under limited safe harbors, any shortfall, even one as small as 0.01% of a

merchant’s volume, gives Visa the right to impose significant monetary penalties on all the

merchant’s Visa debit transactions (not just the marginal transactions). Each penalty imposed by

Visa would be an additional cost to routing away from Visa.

79. Merchants and acquirers are willing to accept de facto exclusive deals with Visa

because they have a substantial number of debit transactions that they cannot route to any other

network—these are non-contestable transactions. The merchant has only two choices: either

(1) agree to exclusivity with Visa or (2) pay Visa’s supracompetitive rack rates for non-

contestable transactions and try to route its contestable transactions to Visa’s competitors. Visa’s

rack rates are frequently higher than the PIN networks’ rack rates. Yet if merchants want to

secure better rates from Visa, they typically need to route all or almost all their Visa-eligible

debit volume over Visa rails. Most of Visa’s volume commitments are significant, with a

minimum threshold of 90–100% of the merchant’s or acquirer’s eligible Visa volume. Thus, Visa

leverages merchants’ lack of choice for the non-contestable transactions to secure volume for

additional transactions at higher rates than it would be able to secure in a competitive market.

80. Consider a hypothetical fast-food restaurant that has a Visa routing commitment

with a cliff pricing structure. During a typical day, the restaurant has one hundred customers who

present Visa-branded debit cards, all with the same back-of-card network. Fifty of those

30
customers order online in card-not-present transactions—these transactions may be contestable

by the back-of-card network. The other fifty customers present Visa-branded debit cards in

person. Their cards are not enabled by the issuer for card-present PINless transactions on the

back-of-card network and the customers do not enter a PIN when prompted to do so at the

payment terminal. These fifty transactions from customers presenting their cards in the restaurant

are non-contestable.

81. Under the terms of its Visa routing agreement, the merchant can avoid Visa’s high

rack rates on the fifty non-contestable transactions, but only if it routes all one hundred

transactions to Visa. If Visa’s rack rate for these transactions is $0.50 per transaction and its rate

for all one hundred transactions is $0.25 per transaction, then the merchant would either pay

$0.50 times 50 non-contestable transactions (totaling $25 plus any PIN network fees paid on the

50 contested transactions) or $0.25 times 100 transactions (totaling $25). This example illustrates

how a smaller PIN network could only compete for the fifty contestable transactions if it agreed

to route the transactions for free, which compensates the merchant for the penalties incurred on

the non-contestable transactions. This is because the price for contestable transactions increases

dramatically in a “cliff” fashion if the target is not met and rack rates are imposed. In this

example, the restaurant pays Visa either $25 to send all of the transactions to Visa or, if it does

not meet the volume requirements of its Visa routing agreement, the cliff pricing is imposed and

the restaurant pays at least $25 to Visa plus whatever it would owe to the back-of-card network

for any transactions it routes away from Visa. PIN networks generally cannot route for free so

the cliff pricing structure has the practical effect of forcing merchants into de facto exclusive

dealing relationships with Visa for the vast majority of their volume of Visa-branded debit card

transactions.

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 82. Even some acquirer processors that operate rival PIN networks have agreed to

exclusive routing deals with Visa. Visa has provided incentives in exchange for volume

commitments from such acquirers. Visa’s payments disincentivize these competitors from using

their own networks to vigorously compete.

83. As a result of Visa’s cliff pricing, for a PIN network to win a meaningful set of

transactions away from Visa, it must do two things. First, the PIN network must offer a better

per-transaction price than Visa. Second, and more significantly, the PIN network must also

compensate the merchant for the penalty Visa will impose on all the transactions the merchant

still has to route to Visa, which is larger than the set of transactions for which the PIN network

can compete. To compensate some merchants for the loss of Visa incentives on Visa-eligible

debit transactions, the PIN network may have to offer zero or negative per-transaction prices.

These penalties reflect significant and cost-prohibitive barriers to expansion for the PIN

networks.

84. When discussing potentially lowering debit prices, one Visa executive advised

against it, noting that Visa has such a large number of “uncontested” transactions that the “P&L

would be hammered. . . . And if you lower the price, there is nothing to put in a routing deal,

merchant gets it by default with no commitment.” Rather than competing on the merits, Visa

chose to keep its penalty prices high so it could insulate its supracompetitive profits by creating a

web of deals to foreclose rivals.

85. To secure even more debit routing exclusivity, Visa sometimes prices other

products, such as credit, based on how much debit volume merchants route to Visa. In one

instance, Visa offered credit incentives, among other things, to win routing from Google and to

32
protect against PINless enablement. Similarly, Visa offered credit incentives to win debit routing

from a health food supermarket chain.

86. Describing one proposed credit and debit routing contract with a different large

merchant, a Visa employee wrote, “We continue to believe that we made a very strong offer that

they cannot replicate with our competitors. While they could recover some (but not all) of the

value they receive from us for the debit routing, they will lose all credit value. Walking away

would not be a commercially reasonable decision for them.” As Visa recognizes, PIN network

competitors do not have credit businesses to raid to buy debit routing.

87. Visa also has a history of introducing new fees that it can so-call “waive” in

exchange for exclusivity (or near exclusivity) making it difficult for merchants to route

transactions to different networks. For example, Visa introduced the FANF in 2012 in response

to threats of increased competition once the Durbin Amendment went into effect. FANF changed

the structure of Visa’s merchant pricing by charging merchants (through their acquirers) a fixed

monthly fee for accepting Visa debit transactions. Visa has raised FANF twice in subsequent

years. FANF is another lever that Visa uses to lock-up merchant debit volume: as an incentive to

entering into routing volume-commitment contracts.

2. Visa’s Contracts with Issuers Unlawfully Restrict the Growth of Its

Debit Competitors

88. Issuers choose the number and identity of debit networks included on their cards.

While the Durbin Amendment requires that each Visa-branded card include at least one

additional network not affiliated with Visa, an issuer could choose to enable additional networks,

thereby increasing the choices available to merchants and driving competition. However, Visa

uses its monopoly power to induce issuers to limit the enablement of rival networks on their

Visa-branded debit cards and thereby limit the choices available to merchants. In its issuing

33
contract with JPMorgan Chase, Visa made this requirement explicit. Chase’s contract with Visa

provides that only one unaffiliated PIN network can be enabled on 90% of Chase-issued Visa-

branded debit cards. In 2023, Visa entered into an agreement with one of its largest fintech debit

issuing customers, that limits enablement to a single non-Visa network for all debit cards issued

through that fintech entity’s partner issuing banks.

89. Visa’s contracts with other large and small issuers achieve a similar effect through

different means. Visa has nearly 1,000 issuing contracts that contain significant volume

incentives, which strongly deter the issuer putting more debit networks on the back of the card.

These contracts frequently contain standardized volume requirements whereby the issuer must

maintain its annual growth of Visa debit transactions in line with Visa’s overall debit growth in

the United States, which helps ensure that Visa’s share of the issuer’s transactions does not

decrease.

90. Visa debit volume gives Visa the power to impose significant monetary costs. For

example, if an issuer does not meet the system growth requirement, it could be required to pay an

early termination fee comprised of a percentage of the benefits it has already earned plus a

multimillion-dollar fixed fee.

91. Visa debit volume targets incentivize issuers not to enable additional networks on

their debit cards and not to enable existing networks for additional transaction types (e.g.,

PINless routing). For example, in a 2020 issuing contract Visa included a minimum volume

requirement that was designed to “mitigate a shift to PINless, RTP [Real Time Payment], etc.”

The language Visa obtained was viewed as “good enough” by senior Visa executives to “protect

for PINless” because the only way the issuer could protect its volume was to “dump[] their debit

network (Shazam) if it starts shifting volume.” Similarly, Visa “signed incremental debit

34
incentive deals” with a number of large issuers and, as a result, Visa thought they were “unlikely

to enable PINless on F2F [face-to-face] transactions.” Many smaller issuers also rely on their

issuer processors to make network selections, and there too Visa enters into agreements that are

designed to “[p]rotect and grow existing [payment volume] from small issuers and discourage

PINless enablement.”

92. Visa’s issuer contracts reinforce the protections created by Visa’s merchant and

acquirer routing contracts by creating artificial barriers to expansion and, in effect, expanding or

entrenching the transaction volume that is non-contestable. Regardless of a merchant’s preferred

routing choice, only networks enabled on a Visa-branded debit card can compete for the

transaction. By virtue of being the dominant front-of-card network, Visa is enabled to process all

transactions on over 70% of debit card payment volume in the United States.

93. Like Visa’s routing contracts with merchants and acquirers, Visa’s volume

requirements in issuing contracts are structured as cliff pricing. Any meaningful shortfall gives

Visa the right to impose significant monetary penalties across all Visa debit transactions (not just

the marginal transactions). If the issuer does not achieve the agreed level of exclusivity in any

given year and that failure is attributable to any affirmative actions by the issuer, including

enablement of any additional PIN networks, then Visa has the right to apply significant monetary

penalties or even an early termination penalty.

94. Visa sometimes leverages discounts on other products, such as its Debit

Processing Services (DPS), to win issuer routing volume, similar to how it leverages discounts

on other products to win merchant routing volume. Visa has packaged card-brand issuance

contracts with its DPS processing services to win business from large banks.

35
 3. Visa’s Response to the Durbin Amendment Successfully Protected Its
Monopoly from Competition.

95. Visa feared that competition from PIN networks post-Durbin would erode its

monopoly share of debit. Initially, the Durbin Amendment had some success in allowing the

smaller PIN networks to grow share. While Visa initially lost share, it quickly recovered and

increased its high share throughout the 14 years since the Durbin Amendment took effect.

96. Since the enactment of the Durbin Amendment, smaller networks have attempted

to chip away at Visa’s dominance. For example, in the early years following the Durbin

Amendment, Mastercard launched a PINless program for Maestro targeted at Visa-branded debit

cards. But any gains were short lived. Again and again, Visa leveraged its tremendous scale and

sheer volume of non-contestable transactions to penalize disloyalty from merchants, acquirers,

and issuers, at the expense of competitors, consumers, merchants, and other market participants.

Visa, by its own recognition, continues to win despite PIN networks generally offering lower

prices.

97. The Dubin Amendment did not exempt Visa, other debit networks, and issuers

from complying with the antitrust laws. Rather, the Dodd-Frank Act, 12 U.S.C. § 5303, which

includes the Durbin Amendment, provides that it is complementary to the antitrust laws,

including the Sherman Act, and that requirements imposed on companies are in addition to, not

to the exclusion of, those provided by the antitrust laws.

98. In response to this new regulatory landscape, Visa has engaged in a relentless

strategy of locking up the entities that control routing decisions and has now entered de facto

exclusive routing contracts with over 180 of its largest merchants and acquirers. Visa’s merchant

and acquirer contracts cover over 75% of Visa’s debit volume and results in the foreclosure of at

least 45% of total U.S. debit volume. This denies competitors the scale necessary to compete

36
effectively, because issuers have a lower incentive to add networks to the debit cards they issue

if merchants predominantly route to Visa. Visa’s contracts with issuers magnify this problem.

Visa uses its contracts with issuers to incentivize the issuers to make decisions—like choosing to

disable card-present PINless or choosing not to enable it—that may make more transactions non-

contestable, providing Visa with additional leverage over merchants and acquirers.

99. Visa deployed a similar response strategy in reaction to the Federal Reserve’s

October 2022 clarification of the rules implementing the Durbin Amendment, referred to as

Regulation II. In anticipation of the Regulation II clarification going into effect, Visa strategized

to secure more volume under routing deals, to target merchant and acquirer deals with early

termination fees for longer, firmer commitments of routing volume as well as to renew issuing

agreements. Visa then took steps to ensure volume was locked up prior to the regulation going

into effect.

4. Visa Uses Its Monopoly Power to Deprive Its Rivals of Scale

100. When two-sided transaction platforms like Visa “achieve scale on the two sides,

it’s an enormous moat around their business, and far more powerful than a one-sided but still

network effect businesses (e.g., Facebook, Microsoft Word, etc.).” Visa’s separate contracts

across both sides of the debit market—accountholders and issuers on one side and merchants and

acquirers on the other—widen the moat around its business and prevent any other debit network

from gaining a meaningful share of the debit market. On one side of the market, Visa

incentivizes issuers to enable fewer networks and fewer routing options on each non-Visa

network. Because fewer issuers enable Visa’s PIN-network competitors and all their features,

merchants and acquirers on the other side of the market are less likely to take the time and

expense to enable routing to PIN networks.

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 101. Rival networks cannot grow their networks to sufficient scale or improve their

networks’ features. They’re caught in a vicious cycle as they lack enough usage and acceptance

on either side of the market to effectively compete with Visa. This network effects phenomenon

results from the difficulty in building scale on both sides of a two-sided market—as described

before, a “herculean task.”

102. Visa uses its power to ensure control over non-contestable transactions and then

leverages its control over those transactions to demand and enforce exclusivity. To overcome

Visa’s scale advantage, a PIN network must not only compete on the merits for transactions it

seeks to route, but also compensate the merchants, acquirers, and issuers for the cost of penalties

imposed by Visa on all non-contestable transactions that the PIN network is not eligible to route.

103. Visa has made it nearly impossible for PIN networks to win additional share.

Despite the increased placement of PIN debit networks on the back of cards after the

implementation of the Durbin Amendment and the PIN debit networks’ development of new

features to compete more closely with Visa and Mastercard, Visa has cut off PIN debit networks

from gaining sufficient usage and acceptance on either side of the market to overcome network

effects. Collectively, the PIN networks represent approximately 11% of all debit transactions

(and only 5% of card-not-present debit transactions). No PIN debit network has more than a

single-digit share of debit transactions in the United States.

104. In the years since the Durbin Amendment, smaller networks have tried to win

transactions from Visa by offering lower fees, innovating, and broadening their features. But the

returns to these efforts were minimal, Visa used its immense size and large volume of non-

contestable transactions to stifle these attempts at competition.

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 105. A lack of scale also inhibits smaller networks from offering fraud protections

equivalent or better than the market leaders because networks need sufficient transaction data to

have acceptably robust fraud detection. Visa claims internally that absent sufficient transaction

data, PIN networks are unable to match Visa’s speed and accuracy at identifying fraud. Visa just

“see[s] more” and, by its own recognition, continues to win despite PIN networks generally

offering lower prices.

106. Visa is aware of these market dynamics and exploits them to limit competition. In

Spring 2023, one Visa executive observed that less than half of the debit volume in the United

States was enabled by issuers to be processed as a card-present PINless transaction, and “[a]s a

result, many merchants have not enabled CP [card-present] PINless.” Acknowledging that issuer

enablement influences merchants’ enablement decisions, Visa feared that a large U.S. issuer

enabling card-present PINless could “create a tipping point . . . for more [acquirer] processors

and merchants enabling and routing CP [card-present] PINless.” Visa thought growing card-

present PINless enablement would lead to more competition from its debit network rivals.

107. For instance, in 2023, JPMorgan Chase had Visa-branded debit cards with

Mastercard’s Maestro as the back-of-card network unaffiliated with Visa. Although Chase’s

contract with Visa prohibited it from adding a second back-of-card network, Chase requested a

waiver of this contractual requirement from Visa. Chase wanted to also add Discover’s Pulse

network to the back of its Visa-branded debit cards to comply with Regulation II clarification

announced in 2022. At the time, Maestro did not offer the card-not-present PINless functionality

whereas Pulse offered both card-present and card-not-present PINless functionality. Visa

executives feared that if Chase enabled Pulse on the back of its debit cards, “more than 60% of

the CNP volume will be priced lower than Visa by the unaffiliated networks. As that happens,

39
more merchants [] will adopt PINless, resulting in lower transaction win rates for Visa, as well as

a decline in effective transaction clearing price.” Visa executives were concerned that if Chase

enabled Pulse’s PINless functionality, it could create a tipping point for more processors and

merchants to enable and route to PINless, driving an “additional 5-10% in merchant volume to

be enabled for PINless.” Fearing that a PIN network would win more widespread placement and

enablement on both the issuer and merchant sides of the market, Visa granted only a short-term

waiver of its back-of-card network restriction clause to allow Chase to temporarily add Pulse as a

second unaffiliated network the back of its debit cards, but also required that Chase enter a debit

routing agreement with Visa.

C. Visa Uses Its Monopoly Power to Squash Innovative Alternatives to Its Debit
Network

108. Debit cards are not the only way for consumers to pay directly with money in

their bank accounts. For instance, consumers may also use an alternative debit network, such as

those created by fintech companies. Fintech debit networks cut Visa out of the transaction (see

Figure 3 below). They rely on a consumer’s bank account number, rather than a debit card

credential, to make real-time purchases directly from the consumer’s bank accounts. These

potential debit competitors’ networks may not require a network like Visa’s. In place of a

physical or virtual card, fintech debit networks may store consumers’ bank account credentials,

allowing accountholders to purchase goods and services from merchants that participate in their

networks. Visa’s CEO has recognized that these sorts of “disruptive innovations are happening

elsewhere in the world.” Visa fears that potential competitors would attempt to replicate those

successes in the United States.

40
 Figure 3

109. These potential debit competitors could be embedded in different types of

payment solutions, such as digital wallets and other fintech products. Well-known digital wallets

include Apple Pay, Google Pay, and PayPal. Digital wallets are software-based systems, usually

on a smartphone or computer, that store a consumer’s payment credentials—including debit

cards, credit cards, and, in some wallets, fintech debit networks—to fund consumer-to-merchant

transactions.

110. Visa’s philosophy towards preserving its monopoly from attacks by new

competitors can be boiled down to the words of its former CFO: “[E]verybody is a friend and

partner. Nobody is a competitor.” As Visa’s former CFO went on to say, “The only issue is to

figure out how to make it worth their while to partner with us. And so far, we’ve managed to do

that, whether it’s with wallets, whether it’s with large tech companies, whether it’s with large

merchants. And as long as we keep doing that and keep our network valuable for everyone,

things should be fine.” This strategy has worked.

111. Over the past decade, there has been a substantial increase in the number and

volume of debit transactions that occur online. The rise of mobile payments and the COVID-19

pandemic have fueled this significant change in the industry. This trend, however, has not seen a

41
corresponding rise in the adoption of new payment methods—new technologies and new

services continue to largely run on the payment rails of the past. This is because Visa has used its

monopoly power in debit markets to stifle potential competitors, such as fintech debit networks,

from creating or enhancing any payment methods that compete with Visa. Visa’s conduct is

deliberate and part of a strategy to maintain its monopoly. Visa is always on the lookout for ways

new payment technologies could reduce or eliminate the need for Visa to act as an intermediary

between both sides of a debit transaction. Rather than compete with alternatives to its debit rails,

Visa “seek[s] to partner with technology disruptors to mitigate threats whenever possible. . . .

Identify and partner with emerging players before they become disruptors.”

112. At the heart of the strategy is a quid pro quo: Visa uses “custom incentives

programs” to “target a small number of Visa’s largest and most influential merchants for a

custom incentive arrangement in return for disintermediation/non-discrimination protections,

non-disparagement, and future commitments.” These contracts amount to a horizontal product

market division. As Visa describes it, “These are not routing deals, these are relationship give

away deals that have nothing to do with routing.” In some cases, Visa “make[s] less money than

[they] would in a worst case do nothing” scenario.

1. Visa Fears that Fintech Debit Networks Will Disintermediate Its

Lucrative Debit Business

113. Since at least 2013, Visa has been concerned that fintech debit networks would

displace Visa as an intermediary between both sides of a debit transaction. A fintech debit

network can facilitate consumer-to-merchant payments by providing end-to-end functionality

equivalent to debit card networks: it authorizes payments from a consumer’s bank account,

facilitates communications with the consumer’s bank to clear the transaction, and provides

settlement services by initiating a payment to the merchant’s financial institution. The fintech

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debit networks provide additional capabilities like payment guarantee for merchants, dispute

resolution and chargeback services, and fraud protections.

114. Visa’s fear of disintermediation has been exacerbated by two developments:

increasing availability of alternative payment rails that move money in real time, and a growing

number of fintech firms that are able to build upon these payment rails to compete with Visa,

particularly Visa’s lucrative card-not-present debit business. Other participants in the payments

ecosystem, such as payment processors, banks, and firms that have the ability to build the

necessary connections between consumer bank accounts and merchants, also have the capability

to offer fintech debit network services. As Visa recognized, real-time fintech payments “will

become a viable merchant option: positioned and priced as a ‘Substitute for Debit.’”

115. Visa feared that its Big Tech “frenemies” would launch debit networks that

compete with Visa by displacing card-based funding options with payments directly from

consumers’ bank accounts. This fear was heightened by new, non-card-based payment rails

which created cheaper alternatives to Visa’s payments rails. For decades, payment networks have

facilitated bank transfers via ACH, an interbank payment service which took several days to

settle payment and even longer to make funds available in a consumer’s bank account. However,

new alternatives have developed. Innovative fintech firms have sought to build new capabilities

on ACH and even new infrastructure that provides a faster alternative to ACH (known as real-

time payments or RTP). For example, The Clearing House launched RTP Network, a real-time-

payments network that allows immediate clearance and settlement of transactions, and the

Federal Reserve launched FedNow in 2023 to provide instant payment services between

depository institutions. As faster payment alternatives emerge and banks begin to connect to

them, they create the opportunity for making funds available in as close to real time as possible.

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 116. To date, few digital wallets or other potential fintech debit networks have

incorporated these new real-time payments networks. Digital wallets are financial transaction

applications, usually stored in a smartphone or computer, that can be used to complete consumer-

to-merchant transactions at more than one retailer using a stored payment credential. Digital

wallets may enable consumers to pay for goods and services with funds in the wallet—these

types of wallets are known as staged digital wallets or stored value wallets. Staged digital wallets

may use funds preloaded in the wallet or may pull funds into the wallet from a linked bank

account (such as a checking account, using either a debit card or a bank account number) to

make transactions. In the United States, PayPal and Square’s Cash App operate as staged digital

wallets. A second type of digital wallet, called a pass-through wallet, transmits a consumer’s

payment credentials (such as a debit card account number) directly to a merchant’s acquirer,

which then uses those credentials to process the payment in a manner similar to a traditional

debit transaction. Apple Pay and Google Pay are two popular examples of pass-through digital

wallets.

117. Visa is particularly concerned with potential competitors that have relationships

with both accountholders and merchants, because these companies are positioned to build the

scale necessary to succeed as a payment platform. Visa knew that tech companies like PayPal,

Apple, and Square had acceptance at millions of merchants and relationships with over one

hundred million accountholders in the United States. Like traditional debit networks, fintech

debit networks require both consumer and merchant participation. Consumers enroll in the

fintech company’s network, including going through the steps to link their bank accounts.

Merchants also enroll in the service.

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 118. For example, Visa understood that Apple Pay’s broad merchant acceptance and

popularity with consumers represented “an existential threat” to Visa’s debit business. Visa has

consistently viewed Apple as a threat, in large part due to its broad merchant acceptance and

broad base of Apple Pay users. Visa feared that Apple on its own, or in partnership with another

entity, could build its own payment network independent of Visa’s rails. Visa was aware that

Apple had approached a large debit issuer about building a network without Visa or Mastercard.

2. Visa Leveraged Its Debit Monopoly to Prevent PayPal and Others

from Disintermediating Visa with Staged Digital Wallets

119. According to one Visa executive’s assessment, the only major entity to

successfully disintermediate Visa in the United States is PayPal. But in 2016 Visa blunted this

threat by signing a massive deal with PayPal, using Visa’s standard playbook of threatening high

fees and dangling big payoffs to move PayPal transaction volume back to Visa’s rails and stop

PayPal from competing aggressively against Visa.

120. In the 2000s and early 2010s, many merchants started accepting PayPal as part of

their expansion into e-commerce. Some of PayPal’s customers used their Visa debit cards to pay

for transactions at these merchants, including many online small- and mid-sized businesses. As a

result, PayPal brought significant incremental volume to Visa, which Visa initially

supported. But in 2015, when PayPal was spun-off from its parent company, eBay, Visa’s view

of PayPal changed. Visa viewed the new company as an “innovative competitor that will be

more aggressive as standalone entity.” In particular, Visa was concerned about PayPal’s scale

and its move to encourage PayPal users to pay directly for goods and services with their bank

accounts rather than with their debit or credit cards.

121. PayPal offered a staged digital wallet with an alternative debit credential:

accountholders loaded funds into their PayPal wallet using their bank credentials and could make

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purchases using ACH. ACH transactions from PayPal’s wallet included many of the same

features as debit, such as fraud detection, fund guarantees, and the ability to dispute a

transaction. Visa wanted to discourage staged digital wallets, such as PayPal, because it viewed

them as an “increased disintermediation risk for issuers and Visa” which came with a

“cannibalization risk.” A Visa executive viewed having a commercial relationship with a

company supporting a staged wallet model as a “line that must never be crossed.”

122. Visa had an ace card in its negotiations with PayPal. Even with PayPal’s new

model encouraging consumers to pay directly with their bank accounts, a substantial number of

its customers had continued to make payments through PayPal using their Visa-branded debit

cards. To squash PayPal’s use of ACH in the staged digital wallet model, Visa used the threat of

exorbitant wallet fees and high rack rates on these Visa transactions to induce PayPal to enter

into a new, expansive routing contract. PayPal risked losing customers who used Visa on its

platform if it told them they could no longer use their Visa-branded cards, and so it had little

choice but to take the deal.

123. At this time, PayPal was also entering into new partnerships to bring its payments

innovations to in-store merchants. Visa stymied these partnerships by imposing a restriction on

ACH funding transactions when the PayPal customer had an existing Visa-branded card in their

PayPal wallet. While Visa relaxed its restrictions in 2021, Visa mandated information sharing so

that it could monitor PayPal’s product success and to this day restricts PayPal’s in-store ACH

funding transactions to a QR code model whereby a consumer must scan a merchant’s QR code

before connecting to PayPal to complete a transaction. Visa’s continued restrictions on PayPal

add frictions that limit the use of PayPal as an in-store alternative to Visa.

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 124. In 2022, PayPal and Visa entered into a new 10-year contract that limits PayPal’s

incentives and ability to disrupt the debit market. This includes a debit routing commitment of

100% of its Visa-eligible volume from years four to ten, penalties for failing to convert its co-

branded debit cards to Visa, a requirement to participate in certain Visa programs and services,

and preservation of most of Visa’s “customer choice” provisions, which preference Visa

payment methods over other competitive alternatives. Visa’s continued dominance of the debit

market and the looming threat of Visa’s exorbitant wallet fees and rack rates left PayPal with few

alternatives to compete on Visa’s terms.

125. Since 2016, Visa has threatened to impose the staged digital wallet fee on other

entities, but all have signed deals with Visa rather than pay it. Visa views the fee as “a behavioral

fee to reflect the propensity of SDWOs [staged digital wallet operators] to disintermediate Visa,”

and waives the fee if the wallets behave as Visa demands. In other words, Visa offered the staged

digital wallets a choice: agree not to compete with Visa or pay substantial targeted fees that make

the alternative networks far less profitable to operate.

126. Visa has also entered into a series of contracts with Square that have foreclosed

Square from competing aggressively against Visa and prevented Square from developing a

viable alternative for consumer-to-merchant payments.

127. In 2013, Square launched a new service, Square Cash (later called Cash App) that

enabled person-to-person payments. Square sought to avoid additional Visa fees for Square Cash

so that it could facilitate such payments using debit cards. Visa worried that if it did not sign a

contract for Square Cash, Square was “likely to build in an ACH option.” An ACH routing

option (which requires a consumer to link their bank account credential) would pose a threat to

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Visa’s debit payment volume because Square could use the bank account credentials from

person-to-person transactions to launch a new consumer-to-merchant debit product.

128. Visa chose to participate in Square Cash and offered not to charge high rack rates

for transactions using Visa’s debit network, but Visa required that it have the right to terminate

for convenience, in case Square started to compete with Visa. Visa believed it got two main

benefits from the deal: (1) the debit routing commitment; and (2) “non-disintermediation, of

which the major concern is ACH.”

129. After signing the first contract with Square in 2014, a Visa executive stated,

“we’ve got Square on a short leash and our deal structure was meant to protect against

disintermediation.”

130. In 2016, Square innovated and announced a new product, called “Cash Drawer”

that allowed users to store funds in their Square Cash account, similar to PayPal and its person-

to-person payments platform Venmo. Visa was concerned that the product was a “greater

disintermediation threat” that had the potential to disrupt its (and its issuer clients’) profitable

debit rails.

131. Visa acted quickly to prevent any disruption. Visa sent a letter of intent to

terminate its contract with Square, reporting to Square that Cash Drawer was a “huge deal for

us” and a “third rail” issue as “a staged wallet model was antithetical [to] what we worked so

hard to develop together with Square Cash.” Faced with the risk of paying higher fees and other

penalties on its Visa debit transactions, Square quickly backed down and removed the feature;

Visa did not terminate the contract.

132. More recently, Square launched Cash App Pay, which enables consumers to use

Cash App to make purchases from merchants. This new product would trigger Visa’s

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burdensome staged digital wallet fees, and Square asked Visa to waive those fees. Visa

recognized that these threatened fees gave it “a significant lever in negotiation.” As one Visa

executive noted after the launch of Cash App Pay, “Square’s approach is predictable and follows

the disintermediation playbook to the letter.” But in 2023, Visa used the leverage from the staged

digital wallet fees to obtain commitments from Square that it would route 97% of its Cash App

Pay transactions over Visa’s rails, which would preference Visa in Cash App Pay signup flow

and default settings, and would not steer customers to ACH in Cash App Pay.

3. Visa Uses Its Leverage Over Its Potential Debit Competitors,

Including Apple, Paying Them Not to Create or Promote Competitive
Products

133. Even for entities that do not operate staged digital wallets, Visa guards against the

potential of being disintermediated. Many of Visa’s potential competitors are also Visa

customers. Visa uses its monopoly power, and the threat of imposing its high fees, rack rates, and

other penalties, to induce potential competitors to sign contracts that preserve Visa’s prime

position in the payments ecosystem. Each year, Visa spends a portion of its supracompetitive

profits to buy off potential competitors, ensuring Visa can continue to reap the financial benefits

of its monopoly.

134. Visa benefits from partnering with established Big Tech players like Google and

Apple by obtaining “total control of ecommerce acceptance and online payments flow in their

ecosystems.”

135. Visa targets a small number of Visa’s largest and most influential Big Tech

merchants with custom incentive arrangements on Visa-eligible debit volume in return for

commitments from them to not dislodge Visa as the middleman, and other future commitments.

These contracts amount to a horizontal product market division. As a Visa executive clarified,

the incentive deals Visa has reached with Apple and Amazon, “are not routing deals, these are

49
relationship give away deals that have nothing to do with routing.” In some cases, Visa

recognizes that its choice to enter into a routing deal might not be as profitable absent an impact

on competition, stating that Visa “make[s] less money than [it] would in a worst case do

nothing” scenario.

136. For example, Visa has deals with Apple in which Apple agrees that it may not

develop or deploy payment functionality with the aim of competing with Visa, such as creating

payment functionality that relies primarily on non-Visa payment processes or payment products.

Apple is also barred from providing incentives “with the intent of disintermediating Visa or

inciting customers to cease using Visa Cards.” In return, Visa shares its monopoly profits with

Apple. Visa has also provided Apple with reduced merchant fees in exchange for Apple’s

commitment not to “build, support, or introduce payment technologies that disintermediate Visa”

or steer customers to third party payment methods such as ACH. Visa payments to Apple

amounted to hundreds of millions of dollars in 2023.

137. Visa recognized internally that the benefit of Visa’s disintermediation terms with

Apple was “volume staying on Visa.” When Visa first entered its contract with Apple in 2012,

Visa wanted the “right to terminate [the] deal if [a] competitor or competitive products emerge.”

As Visa noted: “Cooperation is preferred.” Visa has continued to condition its participation on

Apple maintaining its status as a non-competitor to Visa. In 2022, Visa worried that its

relationship with Apple was at a “tipping point,” as Apple created new inroads into the

traditional debit and credit ecosystems. Visa viewed Apple as an “existential threat” that could

negatively affect both Visa’s yields and its transaction volumes. Visa’s strategy has been to align

its incentives with Apple, which Visa refers to as a “mutually assured destruction principle.”

Visa’s key question for its Apple relationship: “Do we partner with Apple and if so, how?” Visa

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has always answered that question in the affirmative, with massive payments and financial

incentives to Apple.

V. ANTICOMPETITIVE EFFECTS

138. For years, Visa has been able to maintain its dominant position in the market

through actions that harm competition. Its web of exclusionary and anticompetitive contract

terms and its control over currently non-contestable transactions both excludes competition for

those transactions that can—and should—be contested and insulates those currently non-

contestable transactions from competition in the future.

139. Absent Visa’s exclusionary and anticompetitive contracts with merchants,

acquirers, and issuers, and other industry participants, Visa’s back-of-card competitors (i.e., PIN

networks, including Mastercard’s Maestro), would have the chance to gain the scale needed to

compete effectively with Visa and offer banks and merchants real choices. Absent Visa’s

exclusionary and anticompetitive contracts with potential fintech rivals, those would-be

competitors would have greater incentive to innovate and compete more directly with Visa—and

Visa would have more incentive to respond—offering consumers and businesses new choices

and better features. Thus, absent Visa’s anticompetitive and exclusionary conduct, competition

from current and potential rivals would increase competition and likely lead to lower fees, better

service, or greater innovation.

140. Visa’s exclusionary and anticompetitive conduct has broken the competitive

process that should benefit other market participants, including issuers, acquirers, merchants, and

consumers. Visa’s conduct prevents its rivals from being enabled on both the consumer (issuer)

and merchant (acquirer) sides of the debit networks at a scale to compete effectively with Visa.

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 141. Visa’s success in its anticompetitive endeavors is both facilitated and reflected by

the substantial foreclosure of competition it has achieved in the relevant markets. Visa itself

calculated that by the end of 2022 at least 75% of all its debit volume—and 80% of its card-not-

present debit volume—were insulated from competition by its rivals through its contracts.

Looking beyond the debit volume Visa received, its merchant and acquirer routing contracts

alone foreclose at least 45% of all debit transactions in the United States, and an even higher

fraction of card-not-present debit transactions.

142. Visa’s exclusionary and anticompetitive conduct creates a vicious cycle that

further insulates it from competition. By locking up debit volume through agreements that

constrain competition on both sides of the market, Visa has deprived rivals of the scale they need

to offer effective competition now and in the future. This means that rival networks have limited

or no ability to compete on price and quality (e.g., fraud detection) today. Visa’s agreements

limit how much additional volume rival networks can win if they lower prices or invest in new

benefits or features. This reduces the benefits to PIN networks of cutting prices or investing in

new benefits and innovative features. And weakening its rivals in these ways not only protects

Visa from competition for transactions that should be subject to competition today, but also

reduces the chances that those rivals can offer the features and services necessary to erode Visa’s

advantage on non-contestable transactions later, such as further development of PINless routing.

143. Visa’s exclusionary and anticompetitive conduct has stopped beneficial

innovation in other ways. For more than a decade, Visa has sought to delay or deter the

development of fintech network services that would offer Americans new ways to pay merchants

directly from their bank accounts. This has likely delayed or deterred the introduction of features

such as staged digital wallets, store-credit or discount offers in digital wallets, or other features

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that would increase convenience and security and build closer relationships between merchants

and consumers. Visa’s efforts have not only reduced innovation from other companies that

would benefit consumers and businesses today, but also its own incentives to innovate: Visa

admitted that it has not materially invested in innovation in the last decade other than its

tokenization efforts.

144. Vigorous competition should constrain Visa’s prices and spur its investment in

innovation and benefits for its customers and American consumers. But that sort of vigorous

competition is exactly what Visa has worked so hard to avoid. Visa insulates its debit transaction

volume from competition whenever it can; sometimes by foreclosing rivals from being able to

meaningfully compete for significant shares of the market and sometimes by reducing incentives

to compete via imposing fees or providing financial benefits. Visa’s conduct further suppresses

incentives of current and potential rivals—as well as its own incentives—to compete and

innovate.

145. But competition, not Visa, should control whether and how issuers, acquirers,

merchants, and consumers interact with each other. Competition, not Visa, should set the fees

that those issuers, acquirers, merchants, and consumers pay directly or indirectly to debit

networks. And competition, not Visa, should set the pace of innovation—from both rivals and

Visa itself—of features and services that benefit consumers, merchants, acquirers, and issuers in

the markets for debit transactions.

146. Visa has done exactly what it intended to do: capture a substantial volume of

contestable transactions through anticompetitive means, preserve or expand the pool of non-

contestable transactions, block or discourage competitive threats from current or would-be rivals,

and benefit from the monopoly that results. Since the enactment of the Durbin Amendment, PIN

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networks have attempted to chip away at Visa. For example, in the early years following the

Durbin Amendment, Mastercard launched a PINless program for Maestro targeted at Visa-

branded debit cards. But any gains were short lived. Visa repeatedly leveraged its massive scale

and immense volume of non-contestable transactions to penalize disloyalty from merchants,

acquirers, and issuers, at the expense of competitors, consumers, merchants, and other market

participants. Visa, by its own recognition, continues to win despite PIN networks generally

offering lower prices.

VI. NO COUNTERVAILING FACTORS

147. There are no valid, procompetitive benefits to Visa’s exclusionary conduct that

outweigh its anticompetitive effects or cannot be obtained through less restrictive means. Visa’s

anticompetitive contract terms and related conduct are not reasonably necessary to protect Visa’s

technology, incentivize customer growth, prevent free riding, or achieve any other claimed

benefit. Visa can achieve any legitimate, procompetitive objectives without imposing the

anticompetitive terms challenged in this case, or those benefits could be achieved through less

restrictive means. Moreover, Visa’s agreements with current and potential direct competitors are

not ancillary to its vertical relationship. Rather, they are simply divisions of the relevant markets

by direct competitors.

VII. THE RELEVANT U.S. DEBIT MARKETS

148. Courts define a relevant market, which has both a geographic and product market

dimension, to help identify the lines of commerce and areas of competition impacted by alleged

anticompetitive conduct. There can be multiple relevant markets covering the same or similar

products and services and markets need not have precise metes and bounds.

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 149. There are two relevant markets for purposes of identifying Visa’s unlawful,

exclusionary conduct. General purpose debit network services in the United States is a relevant

market. General purpose card-not-present debit network services in the United States is also a

relevant market, one that is narrower and included within the market for general purpose debit

network services in the United States.

A. The United States Is a Relevant Geographic Market

150. The United States is a relevant geographic market. Federal laws and regulations

that govern debit transactions, including card-not-present transactions, operate at the national

level. Visa organizes its U.S. debit business at the national level, as demonstrated by its separate

rules governing merchant acceptance in the United States and its separate pricing of debit,

including card-not-present debit, to merchants, acquirers, and issuers in the United States. The

relevant parties to a debit transaction—consumers, issuers, acquirers, and merchants—could not

practicably turn to debit network services offered elsewhere as alternatives. Therefore, a firm

that was the only seller of general purpose debit network services or general purpose card-not-

present debit network services in the United States would be able to maintain prices above the

level that would prevail in a competitive market.

B. Relevant Product Markets

151. There are two relevant product markets: (1) general purpose debit network

services; and (2) general purpose card-not-present debit network services.

1. General Purpose Debit Network Services Are a Relevant Product

Market

152. General purpose debit network services are payment products and services that

facilitate the debit (i.e., withdrawal) of funds directly out of a consumer’s bank account, often

using a credential or other account number to identify the consumer. Visa and its debit card

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network and fintech debit competitors provide products and services that are inputs to and that

enable debit transactions. They compete to provide debit network services for general purposes,

meaning that their debit credentials are accepted at numerous, unrelated merchants. These

networks sell services simultaneously to both issuers and acquirers, or, in the case of some

alternative debit networks, accountholders and merchants. They serve as intermediaries between

accountholders and merchants, operating two-sided transaction platforms that facilitate

transactions between merchants and accountholders from their respective bank accounts. These

services that Visa and its debit network competitors enable constitute a relevant product market.

153. Debit networks, like Visa, provide a variety of services that enable a debit

transaction, and this suite of services constitutes a product that is jointly consumed by merchants

and accountholders (as well as the acquirers and the issuers). These services include the ability

for the consumer or her bank to dispute and chargeback the transaction; payment guarantees for

merchants; fraud protections for all parties; as well as the “rail” or methods in which the other

parties communicate among each other to facilitate the transaction and transfer funds from the

consumer’s bank account to the merchant’s account. These minimum attributes of debit are

important to merchants, consumers, and banks alike and distinguish debit from other methods of

payment. Although accountholders do not contract directly with Visa, the accountholders and

their banks rely on Visa and other networks to make possible purchases from merchants.

154. Debit networks are two-sided platforms that exhibit a high degree of

interdependency between accountholders and issuers on the one side and merchants and

acquirers on the other. Accountholders and issuers get more value from a network that connects

to more merchants, and merchants and acquirers get more value from a network that connects to

more accountholders.

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 155. General purpose debit network services constitute a relevant product market under

the antitrust laws. Many consumers would not find other payment services to be a suitable

substitute for debit. Issuers, knowing that many of their accountholders value debit, do not

consider alternative payment services to be a suitable substitute for debit. Merchants do not

consider other payment services to be a substitute for debit because they do not want to risk lost

sales by not accepting many consumers’ preferred payment method. Acquirers, knowing that

their merchants value debit, do not view alternative payment services to be a suitable substitute

for debit. Thus, there are no reasonable substitutes for general purpose debit network services,

and a firm that was the only seller of services to facilitate debit transactions would be able to

maintain prices above the level that would prevail in a competitive market.

156. The market for general purpose debit network services includes services sold by

debit networks other than traditional debit card networks. Fintech debit networks can be accepted

at all merchants that participate in the network and provide payment guarantees, dispute

resolution and chargeback capabilities, and fraud protection services. In a debit transaction

processed by a fintech network, the consumer does not have a “debit card” and there is no

“issuer” of a physical or virtual debit card, however, the services provided by fintech debit

networks provide the same functionality to consumers and merchants.

157. General purpose credit card network services are not reasonably interchangeable

with debit network services because debit payments draw from funds already in a consumer’s

bank account, rather than from a line of credit. Visa describes debit as a “pay now” product and

credit as a “pay later” product. The distinction between credit and debit is widely accepted in the

payments industry. Visa and other card networks have different pricing for debit and credit

transactions, and the Durbin Amendment’s limitations of issuer transaction fees does not apply to

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credit. Many accountholders do not qualify for credit cards or have a strong preference for

paying out of their existing funds rather than taking on debt to make purchases using a line of

credit. Given many accountholders’ strong preference for debit, issuers cannot substitute from

debit to credit.

158. Network services for store cards and other prepaid cards are not reasonably

interchangeable with debit network services. Rather, Visa sees prepaid cards as “complements”

to its other card products. Prepaid cards are not connected to a consumer’s bank account, so only

funds that have been loaded on the card in advance can be spent. For that reason, Visa refers to

prepaid as a “pay before” product, while debit is a “pay now” product. Visa also prices prepaid

card network services differently to merchants, acquirers, and issuers than debit cards.

159. Payments made through basic ACH transfers offered by The Clearing House or

the Federal Reserve are often used for disbursements, paychecks, interbank settlements, and

recurring fixed payments like mortgage and tuition payments. A basic ACH transfer is not

reasonably interchangeable for most debit transactions. Absent services created by fintech firms

and other payment networks, basic ACH transfers are inconvenient for consumers because they

require a burdensome onboarding process in which the consumer must enter his bank account

and routing information for each merchant, and then take steps to verify his account, which

requires additional input and can take several hours or even days. ACH transfers are

inconvenient for merchants because it can take two to three days to determine whether a payment

is successful, and such transfers are more subject to fraud. Basic ACH transfers also lack the

guarantee of payment for merchants and the dispute resolution and chargeback capabilities for

consumers that debit offers. Newer interbank instant payment services, such as the Federal

Reserve’s FedNow and The Clearing House’s RTP, may provide faster payment transfers in the

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future, but they would require the same additional services from a fintech or other payment

network, such as fraud detection, dispute resolution, and chargeback services, to become a viable

alternative to debit.

160. Cash and check payments are not reasonably interchangeable for debit network

services. Merchants and accountholders do not view cash and check transactions as reasonably

interchangeable with debit transactions. The procedures and costs for accepting and processing

cash and check payments differ widely from those for accepting and processing payments

directly from the accountholder’s bank.

2. General Purpose Card-Not-Present Debit Network Services Are a

Relevant Product Market

161. General purpose network services for all debit transactions, where debit

credentials are accepted at numerous, unrelated merchants, constitute a relevant market;

however, industry participants, including Visa, also categorize debit network services in

narrower markets that are best understood as submarkets of the larger market for debit network

services. General purpose card-not-present debit network services are a narrower relevant

product market included within the broader general purpose debit network services market.

Card-not-present debit network services are primarily utilized for e-commerce transactions.

162. The general purpose card-not-present debit network services market includes both

traditional debit card transactions and fintech debit transactions. Both enable consumers to pay

for goods and services at numerous, unrelated merchants directly from the funds in their bank

accounts.

163. General purpose card-not-present debit network services constitutes a relevant

product market under the antitrust laws. Few consumers, issuers, merchants, or acquirers would

find other payment services to be a suitable substitute for card-not-present debit. In the card-not-

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present channel, there are even fewer viable forms of payment (for example, cash is not an

option) than in the broader general purpose debit network services market. Thus, there are no

reasonable substitutes for card-not-present debit, and a firm that was the only seller of general

purpose card-not-present debit network services would be able to maintain prices above the level

that would prevail in a competitive market.

VIII. VISA HAS MONOPOLY POWER IN THE U.S. DEBIT MARKETS

164. Visa is a monopolist in the general purpose debit network services and general

purpose card-not-present debit network services markets in the United States with market shares

of at least 60% and 65%, respectively, by payment volume. Mastercard is the second largest

debit network in the United States and processes less than 25% of debit transactions in either

relevant market. No other competitor has more than a single digit share of debit transactions in

either market.

165. Visa has monopoly power in the relevant debit markets because it has the power

to control prices and exclude competition in each market.

166. Visa has been able to maintain monopoly prices as reflected in its high profit

margins. Visa has an operating margin of 83% in North America, of which its U.S. debit

business is the largest contributor. These margins are well above Visa’s reported high margins

globally, since it became a public company in 2007, and much higher than the vast majority of

public companies.

167. Visa has been able to successfully exclude competition in each market, as

reflected in its durable high market shares that persist in the face of regulatory changes. After a

brief period of adjustment when the Durbin Amendment took effect in 2012, Visa’s market

shares have increased over the last decade. Immediately after the Durbin Amendment went into

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effect, Visa’s share dropped from approximately 63% of debit payment volume in 2011 to

approximately 56% in 2012. But leading up to the implementation of the Durbin Amendment,

Visa took steps to insulate its debit business from PIN network competition. Visa began a

program of signing contracts with merchants and acquirers to ensure that all or nearly all their

Visa-eligible debit volume was routed to Visa. Within a few years, Visa was able to regain and

strengthen its debit monopoly. And in subsequent years, it has repeated this playbook in response

to each new threat to its debit monopoly.

168. Similarly, even with the recent Regulation II clarification requiring issuers to

enable at least one network unaffiliated with the front-of-card network for card-not-present debit

transactions, there has been no meaningful impact to Visa’s market shares.

169. Several additional factors beyond Visa’s high margins and durable market shares

show that it has monopoly power.

170. Unlike the smaller PIN networks, Visa and Mastercard are accepted by nearly all

U.S. merchants that accept debit as a form of payment—regardless of whether the merchant

derives most of its revenue from card-present or card-not-present sales. Merchants view Visa and

Mastercard as must-haves, accepting both networks to maximize their ability to make a sale with

whichever debit cards their customers present. This feature of the market for debit transactions

increases the power that Visa is able to exercise over merchants. In contrast to more competitive

industries, merchants cannot simply walk away from Visa when charged higher prices or given

worse terms. In addition, debit networks face barriers to entry and expansion such as regulation

and brand recognition.

171. Merchants and acquirers are more likely to incur the costs of enabling and

maintaining compliance with networks that have sufficient volume to make the expense and

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effort worth it. Similarly, issuers are more likely to enable networks if those networks are widely

accepted by merchants. Additionally, Visa recognizes that smaller rivals lack scale—widespread

enablement by issuers on their debit cards and acceptance by merchants. Because the market is

two-sided, it is difficult to win widespread enablement without widespread acceptance and vice-

versa. This creates a feedback loop, known as “network effects,” that makes the need for scale a

particularly significant barrier to entry and expansion.

172. Banks generally only issue debit cards under a single front-of-card network,

entering long-term contracts with either Visa or Mastercard and infrequently switching between

the two, in part because of the cost and consumer disruption associated with switching. These

switching costs further protect Visa’s dominance on the front-of-card by inhibiting Mastercard’s

growth and the potential for other front-of-card competitors to enter or expand.

173. Visa recognizes and exploits these barriers to entry, including switching costs and

network effects, to protect itself from competition from rival networks and potential competitors

that may break Visa’s stranglehold on U.S. debit markets. For example, to prevent any PIN

network from gaining scale, in 2023, Visa informed issuers they may be required to pay

monetary penalties if they enabled new features of rival PIN networks that resulted in the loss of

Visa debit network volume. At the time, new regulations from the Federal Reserve mandated that

issuers enable at least two unaffiliated networks for card-not-present transactions. Previously,

many issuers had relied exclusively on the front-of-card networks—either Visa or Mastercard—

to process those transactions. Visa worried that merchants and acquirers would finally enable

rival debit networks’ PINless capabilities. However, the Federal Reserve’s requirement applied

only to card-not-present transactions. To slow the enablement of PINless capabilities by

merchants and acquirers, Visa began encouraging issuers to turn off PINless capabilities for card-

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present debit transactions. Among the approved talking points was a reminder that enabling card-

present PINless may result in the issuing partner paying higher fees and other penalties. These

penalties would serve as a price increase to issuers, one which they could not easily avoid due to

the costs of switching networks. Visa’s actions to encourage disabling card-present PINless helps

Visa increase its set of non-contestable transactions, which it utilizes to create penalties for

disloyalty.

174. Visa is able to set prices without regard to its costs. Visa is also able to price

discriminate between various industry groups and such price discrimination is unrelated to Visa’s

costs in providing its services to those industry groups.

175. Moreover, Visa has successfully imposed new, unfavorable pricing structures

without losing debit volume. For example, in 2012, Visa implemented its new monthly FANF

across all merchants and acquirers. In October 2023, Visa introduced the mandatory Digital

Commerce Service fee. This fee bundled several previously optional “value-added services” fees

charged to card-not-present transactions. Visa anticipates almost five-times the net revenue from

the new mandatory fee than from the previously optional fees. Despite imposing a new fee for

merchants through their acquirers, Visa knew it wouldn’t lose transactions. Visa sets fees, not

based on its costs or competition, but rather “relative to value we provide,” i.e., Visa’s perception

of its own value.

IX. JURISDICTION, VENUE, AND COMMERCE

176. The United States brings this action pursuant to Section 4 of the Sherman Act, 15

U.S.C. § 4, to prevent and restrain Visa’s violations of Sections 1 and 2 of the Sherman Act, 15

U.S.C. §§ 1, 2.

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 177. This Court has subject matter jurisdiction over this action under Section 4 of the

Sherman Act, 15 U.S.C. § 4, and 28 U.S.C. §§ 1331, 1337(a), and 1345.

178. The Court has personal jurisdiction over Visa; venue is proper in this District

under Section 12 of the Clayton Act, 15 U.S.C. § 22, and under 28 U.S.C. § 1391 because Visa

transacts business and is found within this District.

179. Visa Inc. is a Delaware company headquartered in San Francisco, California. Visa

is a global payments company that operates the largest debit network in the United States,

routing 57.6 billion debit transactions worth $2.8 trillion in 2023. Visa provides a two-sided

transactions platform that authorizes, clears, and settles debit transactions between businesses,

consumers, and banks. Visa reported revenues of approximately $32.7 billion in fiscal year 2023,

including $14 billion in the United States.

180. Visa engages in, and its activities substantially affect, interstate trade and

commerce. Visa provides services that are marketed, distributed, and offered throughout the

United States, including across state lines and in this district. Visa’s actions are ongoing and are

likely to continue or recur, including through other practices with the same purpose or effect.

X. VIOLATIONS ALLEGED

A. First Claim for Relief: Monopolization of the Markets for General Purpose
Debit Network Services and General Purpose Card-Not-Present Debit
Network Services in the United States in Violation of Sherman Act § 2

181. Plaintiff incorporates the allegations of paragraphs 1 through 180 above.

182. Visa has monopolized, in violation of Section 2 of the Sherman Act, 15 U.S.C. §

2, two relevant markets related to debit transactions in the United States: (1) the market for

general purpose card-not-present debit network services; and (2) the market for general purpose

debit network services.

183. Visa has monopoly power in both relevant markets.

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 184. Visa has willfully and unlawfully maintained its monopoly in each relevant

market through an exclusionary course of conduct and anticompetitive acts described herein.

Each of Visa’s actions individually and collectively increased, maintained, or protected its

monopoly in each relevant market.

185. While each of Visa’s acts is anticompetitive in its own right, Visa’s interrelated

and interdependent actions have had a cumulative and self-reinforcing effect that has harmed

competition and the competitive process in each relevant market, including, as compared to a

more competitive environment, raising barriers to competition by other current and potential

competitors, imposing supracompetitive prices, stabilizing prices, depressing price competition,

restricting output or other services, and slowing innovation.

186. Visa’s exclusionary conduct lacks a procompetitive justification that offsets the

harm caused by Visa’s anticompetitive and unlawful conduct.

B. Second Claim for Relief: Attempted Monopolization of the Markets for

General Purpose Debit Network Services and General Purpose Debit Card-
Not-Present Debit Network Services in the United States in Violation of
Sherman Act § 2

187. Plaintiff incorporates the allegations of paragraphs 1 through 180 above.

188. Visa has attempted to monopolize, in violation of Section 2 of the Sherman Act,

15 U.S.C. § 2, two relevant markets related to debit transactions in the United States: (1) the

market for general purpose card-not-present debit network services; and (2) the market for

general purpose debit network services.

189. Visa has monopoly power, or alternatively has a dangerous probability of

obtaining monopoly power, in both relevant markets.

190. Visa has attempted to monopolize each relevant market through an exclusionary

course of conduct and anticompetitive acts described herein. While each of Visa’s acts is

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anticompetitive in its own right, Visa’s interrelated and interdependent actions have had a

cumulative and self-reinforcing effect that has harmed competition and the competitive process

in each relevant market, including, as compared to a more competitive environment, raising

barriers to competition by other current and potential competitors, imposing supracompetitive

prices, stabilizing prices, depressing price competition, restricting output or other services, and

slowing innovation.

191. In undertaking this course of conduct, Visa has acted with specific intent to

monopolize each relevant market in the United States. Each of Visa’s actions individually and

collectively were specifically intended to monopolize each relevant market in the United States

by destroying effective competition in those markets through the acts alleged herein. There is a

dangerous probability that, unless restrained, Visa will succeed in monopolizing each market in

the United States in violation of Section 2 of the Sherman Act.

192. Visa’s exclusionary conduct lacks a procompetitive justification that offsets the

harm caused by Visa’s anticompetitive and unlawful conduct.

C. Third Claim for Relief: Unlawful Agreements Not to Compete in Violation of

Sherman Act § 1

193. Plaintiff incorporates the allegations of paragraphs 1 through 180 above. Plaintiff

incorporates the allegations of paragraphs 1 through 180 above.

194. Visa’s agreements with competitors and potential competitors not to compete

unreasonably restrain competition, in violation of Section 1 of the Sherman Act, 15 U.S.C. § 1,

in two relevant markets related to debit transactions in the United States: (1) the market for

general purpose card-not-present debit network services; and (2) the market for general purpose

debit network services.

195. Visa has market power in both relevant markets.

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 196. Visa’s agreements pay competitors not to compete in each relevant market and

pay potential competitors not to develop alternatives to debit card networks or adopt new

technologies that may disintermediate traditional debit card networks. These agreements reduce

or eliminate competition from existing or potential rivals who would challenge Visa’s dominance

and thus impede competition and unreasonably restrain trade in each relevant market. Compared

to a more competitive environment, the effects of these agreements include raising barriers to

competition by current and potential competitors, imposing supracompetitive prices, stabilizing

prices, depressing price competition, restricted output or other services, and slowing innovation.

197. These agreements are not reasonably necessary to accomplish any procompetitive

goals. Any procompetitive benefits are outweighed by anticompetitive harm, and there are less

restrictive alternatives by which Visa would be able to reasonably achieve any procompetitive

goals.

D. Fourth Claim for Relief: Unlawful Agreements that Restrain Trade in

Violation of Sherman Act § 1

198. Plaintiff incorporates the allegations of paragraphs 1 through 180 above. Plaintiff

incorporates the allegations of paragraphs 1 through 180 above.

199. Visa’s agreements with merchants, issuers, and acquirers unreasonably restrain

trade, in violation of Section 1 of the Sherman Act, 15 U.S.C. § 1, in two relevant markets

related to debit transactions in the United States: (1) the market for general purpose card-not-

present debit network services; and (2) the market for general purpose debit network services.

200. Visa has market power in both relevant markets.

201. These agreements contain penalties, cliff pricing terms, volume commitments,

and other terms that unreasonably restrain competition, including by foreclosing a substantial

share of each relevant market. These agreements make it difficult for competition from existing

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or potential rivals to challenge Visa’s dominance and thus impede competition and unreasonably

restrain trade in each relevant market. The effects of these agreements include raising barriers to

competition by current and potential competitors, imposing supracompetitive prices, stabilizing

prices, depressing price competition, reducing output or other services, and slowing innovation.

202. These agreements are not reasonably necessary to accomplish any procompetitive

goals. Any procompetitive benefits are outweighed by anticompetitive harm, and there are less

restrictive alternatives by which Visa would be able to reasonably achieve any procompetitive

goals.

XI. REQUEST FOR RELIEF

203. To remedy these illegal acts, Plaintiff requests that the Court:

a. Adjudge and decree that Visa has acted unlawfully to monopolize, or, in

the alternative, attempt to monopolize, the market for general purpose card-not-present

debit network services in the United States in violation of Section 2 of the Sherman Act, 15

U.S.C. § 2;

b. Adjudge and decree that Visa has acted unlawfully to monopolize, or, in

the alternative, attempt to monopolize, the market for general purpose debit network

services in the United States in violation of Section 2 of the Sherman Act, 15 U.S.C. § 2;

c. Adjudge and decree that Visa has acted unlawfully to contract or conspire

to restrain trade in the market for general purpose card-not-present debit network services

in the United States in violation of Section 1 of the Sherman Act, 15 U.S.C. § 1;

d. Adjudge and decree that Visa has acted unlawfully to contract or conspire

to restrain trade in the market for general purpose debit network services in the United

States in violation of Section 1 of the Sherman Act, 15 U.S.C. § 1;

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 e. Enter such relief as needed to cure the anticompetitive harm from all of

Visa’s unlawful actions;

f. Enjoin Visa from continuing to engage in the anticompetitive practices

described herein and from engaging in any other practices with the same purpose or effect

as the challenged practices, including, but not limited to:

i. bundling credit services or credit incentives with debit network services or

debit volume;

ii. imposing pricing or incentive structures, such as cliff pricing, that

discourage or eliminate competition from rivals, potential rivals, or

customers;

iii. referencing rivals for Visa debit transactions, implicitly or explicitly, in

Visa’s contracts;

iv. imposing fees on debit transactions routed over non-Visa networks; and

v. limiting, by contract or other means, the number of back-of-card networks

on Visa-branded cards;

g. Enjoin Visa from continuing to engage in the anticompetitive practices

described herein and from engaging in any other practices with the same purpose or effect

as the challenged practices, including but not limited to:

i. agreeing, implicitly or explicitly, not to compete;

ii. imposing contractual limitations on the use of payment methods and

payment rails (e.g., ACH, RTP, fintech debit, or alternative debit

networks) that may compete with general purpose card-not-present debit

network services or general purpose debit network services; and

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 iii. imposing contractual limitations on the ability of customers to offer their

own payment networks or methods, or adopt new technologies that may

disintermediate Visa;

h. Enter any other preliminary or permanent relief necessary and appropriate

to restore competitive conditions in the markets affected by Visa’s unlawful conduct;

i. Enter any other relief necessary and appropriate to prevent evasion of the

Court’s preliminary or permanent injunction(s); and

j. Award Plaintiff an amount equal to its costs, including reasonable

attorneys’ fees, incurred in bringing this action.

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Dated: this 24th day of September, 2024
Respectfully Submitted,

FOR PLAINTIFF UNITED STATES OF AMERICA:

DOHA MEKKI _s/ Edward Duffy_______
Principal Deputy Assistant Attorney General EDWARD DUFFY*
Antitrust Division LILLIAN OKAMURO HAFFNER
CAMPBELL HAYNES
HETAL J. DOSHI CHRISTINE A. HILL
Deputy Assistant Attorney General for KEVIN KRAUTSCHEID
Litigation GREGG MALAWER
BENNETT J. MATELSON
MICHAEL KADES LAUREN G.S. RIKER
Deputy Assistant Attorney General for Civil MICHELE TRICHLER
Enforcement ROBERT VANCE
RACHEL L. ZWOLINSKI
RYAN DANKS Attorneys
Director of Civil Enforcement
United States Department of Justice
CATHERINE K. DICK Antitrust Division
Acting Director of Litigation 450 Fifth Street N.W., Suite 4000
Washington, DC 20530
MIRIAM R. VISHIO Telephone: (202) 812-4723
Deputy Director of Civil Enforcement Facsimile: (202) 514-7308
Email: [email protected]
OWEN M. KENDLER
Chief, Financial Services, Fintech, & Banking Attorneys for the United States
Section
* LEAD ATTORNEY TO BE NOTICED

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