The Court of Appeals has ruled in favour of four UK retailers who claimed that card fees charged by Mastercard and Visa when customers make a transaction were too high.
Judge Terence Etherton agreed with Asda, Sainsbury’s, Morrisons and Argos and found that the card merchants’ system was an “unlawful restriction of competition infringing” and prevented other payment providers from rivalling them.
However, it ruled that the fees were “necessary” as argued by the card merchants. The Court of Appeal did not rule what level of interchange fees were “lawful”, so that aspect of the case will be sent to the Competition and Appeals Tribunal for consideration. There, a “lawful” rate is expected to be determined.
Kate Pollock, co-head of competition litigation at Stewarts, the law firm which represented Asda, Argos and Morrisons, said: “Our clients and we are delighted that the Court of Appeal has unequivocally recognised that the fixing of interchange fees by MasterCard and its network members over many years was and is an unlawful infringement of competition law. Our clients now look forward to a swift and final resolution of this matter.”
Retail Sector has approached Visa and Mastercard for comment.