Intense competition is the hallmark of America’s retail industry, driving innovation and bringing consumers lower prices and great products and services. Unfortunately, the absence of competition elsewhere in the retail ecosystem stifles the benefits that naturally result from competition. RILA is committed to engendering competition throughout the retail ecosystem by pursuing policies that curtail anticompetitive business practices and remove roadblocks to innovation.
The connection between retailers and their customers is not always direct. Payment processing, internet access, search, and for some, online marketplaces, are examples of economic essentials that are controlled by third party entities. Many of these entities operate in ecosystems with far less competition than the retail industry. The absence of robust competition in these adjacent industries presents serious risks to retailers in the form of higher costs and disruptions to the overall customer experience. While RILA has concerns with several adjacent industries articulated above, there are issues with super-dominant marketplaces that warrant special attention. Specifically, policymakers should consider potentially anticompetitive behavior of super-dominant marketplaces related to the authorized sale of brands and goods. RILA is also concerned about the potential erosion of consumer trust as a result of inferior product quality through the proliferation of counterfeit and stolen goods. Finally, RILA is concerned about the price harms to consumers when super-dominant marketplaces are combined with limited consumer information pathways. RILA is working with the Federal Trade Commission (FTC), Congress and the judiciary to shine a bright light on these practices as they examine how large technological and financial platform firms use their power to stifle competition and harm consumers and the public more broadly.
RILA is encouraging lawmakers to take four primary courses of action: closely examine technology platforms; scrutinize information infrastructure firms; carefully consider anticompetitive data use; and review competitor cooperation that is no longer technologically necessary—particularly in the area of credit interchange. RILA believes that strong competition in industries connected to retail will benefit consumers and allow retailers to thrive. RILA urges policymakers to scrutinize these four areas closely and take action to strengthen a healthy and competitive marketplace.
“Leading retailers believe the FTC has a responsibility to protect consumers by ensuring that competition exists throughout the retail ecosystem. New approaches are necessary to ensure that access to information empowers, rather than manipulates, consumers as they navigate an economy dominated by a handful of giant tech platforms.”
- Washington, DC
Reforming the Payments Ecosystem
Merchants in the United States pay some of the highest interchange rates or “swipe fees” in the world, costing merchants more than $80 billion each year. The global card companies, along with major issuers, establish these rates in an anticompetitive manner. While past regulatory reforms achieved by RILA have resulted in meaningful improvements, more is needed to reign in a myriad of anticompetitive practices.
In partnership with the Retail Litigation Center, RILA is pursuing legislative and legal remedies. RILA is currently working with key regulators to encourage action that will enable retailers’ right to route online debit transactions over networks other than Visa and Mastercard signature networks. The ability to do so will bring meaningful competition to online debit routing and save merchants hundreds of millions of dollars. The Retail Litigation Center
is looking at potential litigation routes to achieve compliance with the law.
RILA and other merchant trade associations are fully aligned on maintaining the important debit reforms and has built an important alliance with debit networks on our goal to secure ecommerce routing rights. The collaboration among retail trade associations and the non-dominant debit networks will hopefully lead the Federal Reserve and Federal Trade Commission to address our concerns in routing online transactions by the largest financial institutions in the country and the two dominant card brands.
Retail Innovation Center
To address the new retail landscape, RILA formed the Retail Innovation Center and “RTech” brand in the retail, innovation, and policymaking arenas.Read More
Technology and Innovation
The retail innovation ecosystem, which includes RILA’s RTech community, works strategically together to address critical retail industry needs.Read More
Public Policy Agenda
RILA works with policymakers of both parties to help shape a dynamic and growing economy that allows retailers and communities they serve to thrive.Read More