Who has the authority in the selection merchant level and SAQ type?

It is the Merchant acquirer that has the authority of defining the merchant level based on the number of annual transactions. Depending on the merchant level (being a level 2, 3 or 4) the merchant might be eligible for using a Self Assessment Questionnaire (SAQ). The type of SAQ is strongly linked to the payment flow and whether the merchant captures, processes, stores or transmits card holder data such as the card number.