International Updates: MasterCard Faces Multi-Billion Pound Swipe Fee Lawsuit in UK (MAG Quarterly- Volume Four, Issue Four)
By Liz Garner, Vice President, Merchant Advisory Group
December 1, 2016
In September, law firm Quinn Emanuel filed a lawsuit again MasterCard at the UK Competition Appeal Tribunal alleging that interchange fees, which were set at an unlawfully high level, pushed up prices for British consumers from 1992 to 2008. The lawsuit alleges excessive swipe fees forced retailers to hike prices across the board impacting every shopper regardless of whether they paid by cash or card.
The lawsuit estimates 46 million consumers were affected. Potential damages are estimated at upward of 14 billion pounds (roughly $18 to $19 Billion USD). Individual UK cardholders could receive upward of 400 pounds each in damages if the claim is successful. If the lawsuit goes to trial, the case will likely be heard in 2018 in the Competition Appeal Tribunal.
The UK recently updated their legal framework for class-action type lawsuits opening a door for this type of legal claim. Previously, the main consequence for anticompetitive business practices was that a firm would be ordered to stop the activity in question.