Mastercard, Visa’s Merchant Fees Breach Competition Law, UK Tribunal Rules

Global payments processors Visa and Mastercard’s default multilateral interchange fees which are charged to retailers infringe competition law, a London tribunal ruled on Friday in the latest round of the long-running legal saga.

London’s Competition Appeal Tribunal unanimously ruled that Visa and Mastercard’s multilateral interchange fees breach European competition law, in a ruling in linked lawsuits brought by hundreds of merchants.

David Scott, global managing partner of law firm Scott+Scott, which represented the claimants, said the ruling was “a significant win for all merchants who have been paying excessive interchange fees to Visa and Mastercard.”

Both Visa and Mastercard said they disagreed with the decision and intended to seek permission to appeal.

A Visa spokesperson said: “Visa continues to believe that interchange is a critical component to maintaining a secure digital payments ecosystem that benefits all parties, including consumers, merchants and banks.”

“Mastercard strongly disagrees with today’s decision, which is deeply flawed, and will seek permission to appeal,” a Mastercard spokesperson said in a statement.

Litigation over multilateral interchange fees, which are levied on retailers when cardholders make a transaction, has rumbled on for well over a decade in Britain and elsewhere.

Scott+Scott said Friday’s ruling was the first time that Visa and Mastercard’s commercial card and inter-regional multilateral interchange fees had been found to infringe competition law.

The liability trial which led to Friday’s ruling took place in early 2024. A ruling following a further trial to determine whether any alleged overcharge was passed on by retailers to customers is pending.

(Reporting by Tobin; Editing by Emelia Sithole-Matarise)