The European Commission has charged MasterCard Inc. (MA) with fixing the fees retailers must pay for accepting MasterCard and Maestro branded cards, saying this limits competition between banks who use the service.

"The Commission's preliminary view is that such behavior is contrary to the EC Treaty's ban on restrictive business practices," it said in a statement Friday.

The charge sheet was sent on June 23, it said. MasterCard, which is based in Purchase, N.Y., will be able to respond before the commission rules whether the company has broken EU law.

The commission said such a ruling could end MasterCard's fees if regulators believe that any benefits of the fees are outweighed by "restrictive effects on price competition between merchant banks."

It is the second time EU regulators have accused MasterCard of breaking antitrust rules. In September 2003 they filed charges against MasterCard's cross-border interchange fees paid by merchant banks to card-issuing banks for payments made with a MasterCard or a Maestro card.

The commission has also been pushing for a single European payment area so customers would pay the same price to make payments or transfer money to or from another country in the 12 nations area that uses the euro currency.

It wants to see the same fees charged for domestic and cross-border retail payments by 2010, saying this will increase trade across borders and help boost Europe's economy.

Some 45 percent of all credit or debit cards issued in the EU are MasterCard or Maestro.

MasterCards are accepted by some 85 percent of EU retailers who take debit card payments. In 2004 a total of 23 billion card payments were made in the EU, with an overall value of 1.35 trillion euros ($1.69 trillion), the commission said.

Regulators said the MasterCard charges illustrates one of the problems identified during a recent probe into the banking sector: the importance of agreements between banks that raise the cost of using payment cards.

EU Competition Commissioner Neelie Kroes accused card providers such as Visa and MasterCard of racking up "abnormal" and "excessive" profits for banks. She told them to make changes or they would face antitrust investigations that could force them to reform their business or pay fines.

In its first report from a wide-ranging investigation into payment cards in Europe, the European Commission said customers are paying too much because the industry was still split along national lines and new card providers find it hard to set up shop.

This increases retail prices by up to 2.5 percent, the commission said. Customers in some countries are paying 100 percent more for MasterCard and Visa than in other nations, regulators found.

Regulators said the MasterCard inquiry was separate to that probe — which will wrap up with a final report in the autumn.

Earlier this month, MasterCard overturned a ruling by Britain's competition watchdog that the fees it charges retailers violated EU and British law.

Mastercard hailed the decision by the Competition Appeals Tribunal as a victory, but Britain's Office of Fair Trading said it was only a temporary respite as its investigation into the so-called interchange fees continued.

The interchange fees have also become an issue in the United States, where two more retail groups said they had filed class action suits against Mastercard Inc. and Visa USA and a number of major banks over the fees they charge for processing credit card transactions. A similar suit was filed in September by four of the nation's largest merchant associations.

All of the suits accuse Visa, MasterCard Inc. and the card associations member banks of engaging in collusive practices in setting their interchange fees.