The U.S. Department of Justice won a major fintech case that could have created the scene for a number of antitrust applications.
On Tuesday, the DoJ announced that Visa and Plaid have stopped terminating with their planned merger. Originally announced almost exactly a year ago, Visa planned to pay $ 5.3 billion for the emerging technology firm.
Plaid’s ubiquitous software is designed to securely connect diverse financial data systems. In its November 2020 complaint, the DoJ claims that Visa is using the acquisition to eliminate competition. Makan Delrahim, of the DoJ’s antitrust division, said today:
“Visa – which has a large online debit power in the United States – has taken billions of dollars out of the transactions. Now that Visa has abandoned its anti-competitive merger, Plaid and other future fintech innovators are free to explore potential alternatives to Visa’s With online competition, consumers can expect lower prices and better services. ”
Tech, in general, has been at the center of heated debates over antitrust violations. Shortly before the case against Visa, the DoJ filed an antitrust case against Google. Meanwhile, the Federal Trade Commission is suing Facebook.
In both cases, the governing bodies claim that the platforms took advantage of access to competitive data and the ability to drive buyer traffic to the corner of the market. But U.S. antitrust comes primarily from the Sherman Act of 1890, which hardly expected data to become the new oil when oil did not even become the new oil. Meanwhile, the most important technology platforms over the past two decades have been the panacea in the U.S. economy, causing most public officials to hesitate to slow down their role.
This special status came under fire late, especially since 2016. What we are seeing now is a major re-armament of the American antitrust apparatus for a new era.