The Federal Court has ordered a subsidiary of Visa Inc to pay a penalty of A$18 million for engaging in anti-competitive conduct over currency conversion services in Australia. Visa Worldwide contracts in Australia with financial institutions for participation in the Visa network. In addition, Visa Worldwide agreed to pay $2 million to cover the cost of the action, initiated by the Australian Competition and Consumer Commission in February 2013. At issue was whether Visa was breaching competition rules in attempting to limit access to Dynamic Currency Conversion, a service which competes with Visa's currency conversion services. In the year ended 30 June 2010, there were more than 50 million cross-border Visa card purchases in Australia - or, about 60 per cent of all such transactions in Australia.The action was settled on Friday with hardly a courtroom skirmish after both sides presented an agreed statement of facts to the Court, finalised the day before court action was due to start on 31 August. As part of the terms of settlement, all other claims against the Visa group were dismissed, including allegations relating to the supply of DCC at ATMS on the Visa network. In effect, this meant the allegations of misconduct under section 46 of the Competition and Consumer Act were discontinued, probably to the great relief of both sides as a long and complex court battle was avoided.The ACCC allegations were, put briefly, that in April 2010 Visa Worldwide announced and later enforced changes to the Visa rules - the Visa International Operating Regulations - governing the supply of DCC services for point of sale transactions on the Visa network from 1 May 2010 to 6 October 2010. Given its market dominance, the change meant major banks such as Westpac, ANZ and NAB, along with specialist FX players such as Travelex, were effectively locked out of providing DCC to any businesses that were not already signed up for DCC as at 30 April 2010.(If a consumer chooses DCC, the exchange rate is locked in and disclosed to the cardholder at the time of making a transaction and gives international cardholders a choice to complete a transaction in their home currency rather than in the local currency of the merchant, including online merchants.)Visa had argued that the VIOR changes were introduced in the form of a "moratorium", pending a final decision on how it would treat DCC practices in its North America and Asia-Pacific markets. Its counsel had attributed the corporation's motives to a desire to protect their customers from being confused, misled or disadvantaged by DCC. However, as Justice Michael Wigney observed, there was no notice given to participants on the Visa network that the changes were about to be introduced, and no details provided indicating the changes were "temporary or provisional". The Court also noted that there were other ways of protecting its brand and its customers other than the "blunt method" of restricting access to the Visa network by external DCC providers in a way that was likely to