Visa Inc (NYSE:V) and Mastercard Inc (NYSE:MA) could spend billions of pounds in compensation to retailers after the UK Supreme Court upheld a Court of Appeal ruling that the two companies restricted competition they how set their fees.
The case was filed by Sainsbury’s, Morrisons Asda and Argos in 1992 against fees Visa and Mastercard charge retailers when customers pay using cards. The fee charged is called multilateral interchange fees (MIFs). In its ruling, the Supreme Court agreed with the Court of Appeal, which ruled that the MIFs, as charged by Visa and MasterCard, went against both the European Union and UK competition law.
The ruling opens the way for retailers to file compensation lawsuits
According to Sainsbury’s, lead counsel Frances Murphy, who is also a partner at Morgan Lewis, the ruling is likely to open a floodgate of compensation claims from retailers. Murphy said Sainsbury’s is among retailers that are seeking compensation of the unlawful charges.
While commenting on the ruling, Mastercard said the Supreme Court decision is not final as there will be more hearings to address key issues raised. On its side, Visa expressed disappointment in the ruling.
“Visa supports the decision to send the matter to a specialist tribunal so that the evidence can be properly considered.”
Visa Unveil New Global Card
Visa announced the launch of Earthwise™ High Content Card. The card is made from 98% upcycled plastic, launched globally it will be an exclusive offering to both Visa clients and cardholders. The new card was developed by CPI Card Group Inc. and is designed to reduce first-use plastic in payment cards and significantly reduce the amount of plastic wastes released into the environment.
The two companies have signed an agreement to allow all Visa-issuing financial institutions worldwide to access the new card. The eco-friendly card is dual interface capable and allows both contact and contactless payment. It is also EMV® compliant.
“Visa is committed to advancing sustainability in everything we do, from the 100 percent renewable electricity that processes transactions in our data centers, to the sustainable card materials coming to cardholders’ wallets,” said Douglas Sabo, vice president and head of corporate responsibility and sustainability at Visa.