Worldline - Registration Document 2016

Risk Factors Regulatory and legal risks

the Group’s continued registration with Visa and MasterCard. The Group’s revenue from the sale of services to merchants that accept Visa and MasterCard cards are dependent upon In order to provide its Visa, MasterCard and other payment schemes transaction processing services, the Group must be a member (commercial acquirer), and be registered as a processor, of Visa, MasterCard and other payment schemes in the territories where the Group provides such services. If the Group is unable to maintain its membership as a commercial acquirer or registration as processor of such payment schemes, which may be due to none-compliance with the payment schemes’ rules or guidelines (including major security or fraud incidents) resulting in the suspension or cancellation of the Group’s registration, the Group may no longer be able to provide acquiring or processing services to the affected customers, which would have a material adverse effect on the Group’s business, financial condition and results of operations. Changes in the regulation of interchange fees could have a material adverse effect on the Group’s revenue. transactions, negotiated in the trilogue process between the EU Commission, EU Parliament and EU Council was adopted by the EU Parliament on March 10, 2015. Provisions within the IFR take effect on different dates. The interchange fee caps came into effect on December 9, 2015 and the majority of provisions relating to business rules on June 9, 2016. As a general rule, the regulation set a cap on interchange fees at 0.2% of the transaction value for consumer debit cards and at 0.3% for consumer credit cards. As well as capping interchange fees, the IFR also aims to improve transparency and competition in the The European Regulation n°2013/0265 of July 24, 2013 on interchange fees (the “Regulation”) for card-based payment card market by removing barriers to entry IFR could have a significant impact on the structure of card payments market in Europe, including card acceptance, cross-border acquiring, domestic versus international card schemes and issuing business models concerning profitability, increased competition and the ability to launch new products. The adopted Regulation will have material adverse effect on the amount of fees collected by card issuers and payment schemes operators. Accordingly, such issuers or operators might seek to pass on these fee decreases through corresponding increases in scheme membership costs, which could have a material adverse effect on the Group’s business, financial condition and results of operations.

also comply with the PCI-SSC standard entitled “PCI-DSS (Payment Card Industry – Data Security Standard)”. The aim of the PCI-DSS is to ensure that stored cardholder data and sensitive transaction data are always processed in a fully secure manner by systems and data bases. The new standard is compulsory for all systems that handle, store or route such data, whether the payment is made by chip card or not. Like PCI-PTS, maintaining compliance with this standard could require the Group to make changes in the architecture of data processing systems, networks and servers entailing substantial investment. As a provider of payment solutions, particularly centralized payment solutions deployed in large-scale retail, the Group must The Group maintains an on-going relationship with the PCI-SSC to ensure that the Group can address all aspects of current and forthcoming standards under the best possible conditions, including being able to anticipate trends and prepare for future investments and remedial expenditures. Despite this close relationship, the Group might not be able to avoid fraud or tampering with its certified payment terminals and solutions. Such occurrences could damage the Group’s reputation and results of operations. standards could adversely affect the Group’s business. Changes in credit card association or other network rules or A significant source of the Group’s revenue comes from processing transactions through payment schemes, including, in particular, Visa, MasterCard, Bancontact/Mister Cash (in Belgium) and Groupement des Cartes Bancaires CB (in France). In order to provide its transaction processing services, the Group must be registered with, or certified by, such card schemes as members or service providers for member institutions. As such, the Group and many of its customers are subject to card association and network rules that could subject them to a variety of fines or penalties that may be levied by the card associations or networks for certain acts or omissions by the Group, acquirer customers, processing customers and merchants. Payment schemes such as Visa, MasterCard, Bancontact/Mister Cash and Groupement des Cartes Bancaires CB, some of which are the Group’s competitors, set the compliance standards and periodically update and modify them. Changes in the standards may increase the Group’s operating costs that it may not be able to pass on to its clients or other scheme participants. Additionally, changes to payment scheme condition could be materially adversely affected. The termination of the Group’s registration, or any changes in the payment schemes rules that would impair the Group’s registration, could require the Group to stop providing payment schemes services to the Visa, MasterCard or other payment schemes, which would have a material adverse effect on the Group’s business, financial condition and results of operations. rules could have a material adverse effect on the Group’s cash flows and liquidity if the payment schemes impose delays in their processing of payments that are longer than the amount of time the Group takes to process payments on behalf its merchant clients. On occasion, the Group has received notices of non-compliance and fines, which have typically related to excessive chargebacks by a merchant or data security failures on the part of a merchant. If the Group is unable to recover fines from or pass through costs to its merchants or other associated participants, the Group’s results of operations and financial

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Worldline 2016 Registration Document