In the most recent round of the protracted legal battle, a London panel decided on Friday that the default multilateral interchange rates that global payment processors Visa and Mastercard charge shops violate competition law.
In related cases filed by hundreds of merchants, the London Competition Appeal Tribunal unanimously decided that Visa and Mastercard’s multilateral interchange fees violate European competition law.
The decision was hailed as “a significant win for all merchants who have been paying excessive interchange fees to Visa and Mastercard” by David Scott, global managing partner of the legal firm Scott+Scott, which represented the claimants.
Visa and Mastercard both expressed their disapproval of the ruling and their intention to request permission to appeal.
A representative for Visa stated, “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.”
A Mastercard representative said in a statement that the company “strongly disagrees with today’s decision, which is deeply flawed, and will seek permission to appeal.”
Multilateral interchange fees, which are assessed to merchants at the time of a transaction by cardholders, have been the subject of litigation in Britain and other countries for well over ten years.
According to Scott+Scott, Friday’s decision was the first time that competition law was violated by Visa and Mastercard’s commercial card and interregional multilateral interchange fees.
Early in 2024, the liability trial that resulted in Friday’s decision was held.
After an additional trial, a decision regarding whether or not retailers passed on any alleged overcharge to customers is still pending.
