Swiss payments company Global Blue is facing a formal antitrust complaint before EU regulators over allegations that it is breaking competition law by signing exclusive contracts with merchants aimed at excluding rivals.
Rival Refundit has accused Global Blue of sharing its commission with high-end retailers with the aim of signing deals that exclude rivals, as well as a lack of transparency over the fees it charges customers.
Global Blue, which offers tax refunds for travellers on luxury goods, went public last year through a special acquisition vehicle. Its backers include US private equity group Silver Lake.
Refundit alleges the commissions Global Blue charges are “excessive, unfair and opaque” and that they are designed to maintain a dominant position in the market.
“Global Blue’s merchant commission and free services offered to key merchants are predatory and its pricing strategy aims at deterring new entrants and disciplining the market, strengthening even further the economies of scale benefiting the dominant player, Global Blue,” said the complaint, filed with the EU’s competition unit in Brussels late on Monday.
Refundit, which was co-founded by Israeli serial entrepreneur Uri Levine, claims that Global Blue’s success is partly because it has a dominant position in the market. In its complaint, it has asked the European Commission to intervene and bring Global Blue’s alleged anti-competitive conduct to an end.
Levine, who also founded traffic and navigation app Waze, told the Financial Times the current market dynamics meant “everyone loses and there’s one winner” and that his company wanted a “shift” so that “everyone wins and there might be one loser”.
He claimed: “Global Blue built the business in a way that’s good for them. It approached high-end retailers and signed exclusivity agreements for the long term. The company is charging tourists huge fees that are unknown for the traveller,” Levine added. “People are happy to get some money back but not knowing that money has disappeared in a very [opaque] way.”
In its complaint, Refundit said it wants the EU to impose a transparency obligation over the commission Global Blue charges travellers. Refundit also wants regulators in Brussels to prohibit Global Blue from sharing commission with merchants.
Global Blue said: “We are surprised to learn that Refundit is submitting a complaint against Global Blue before the EU. Global Blue is one of many VAT refund operators in a highly competitive market. Global Blue offers a transparent and competitive service to all its stakeholders, including consumers and merchants. Global Blue is committed to compliance with all applicable laws and regulations and has in place a comprehensive competition law compliance policy”.
The European Commission declined to comment.