Landmark Supreme Court Judgment on Interchange Fees
Sainsbury’s Supermarkets Ltd v Visa Europe; Sainsbury’s Supermarkets Ltd v Mastercard; and Asda, Argos & Morrisons (‘AAM’) v Mastercard
Mark Brealey QC appeared for Sainsbury’s, instructed by Mishcon de Reya and Morgan, Lewis & Bockius.
Jon Turner QC, Meredith Pickford QC and Laura Elizabeth John appeared for Asda, Argos and Morrisons, instructed by Stewarts.
Tom Sebastian appeared for the European Commission.
On 17 June 2020, the Supreme Court (Lords Reed, Hodge, Lloyd-Jones, Sales and Hamblen) handed down a landmark judgment on whether certain fees which are paid by merchants to banks under the Visa and Mastercard payment card schemes breach competition law. The judgment finally settles years of litigation in the UK courts, and deep divisions in the rulings which had been given in the lower courts and tribunals. It is also the first judgment of the Supreme Court dealing with the Court of Appeal’s powers of remittal.
Visa and Mastercard operate payment card schemes which enable consumers to pay retailers for their purchases using credit or debit cards. Under these schemes, there are four parties: card issuers; cardholders; merchants; and merchant acquirers (generally, these are the merchants’ banks). The card issuers issue payment cards to cardholders. Cardholders use the cards to purchase items from merchants. The merchants rely upon acquirers (usually banks) to provide them with a service which allows them to accept the card payment .
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