Retailers Succeed in Interchange Fee Appeals
Sainsbury’s Supermarkets Ltd & Ors v Mastercard Incorporated & Ors  EWCA 1536 (Civ)
- Related Member(s):
- Christopher Brown
- Related Practice Area(s):
- Competition and Regulation
- Court of Appeal (Civil Division)
The central question in each appeal was whether the setting of default multilateral interchange fees (“MIFs”) within the MasterCard and Visa payment card systems was an unlawful restriction of competition infringing TFEU, art 101.
Art 101(1) provides that agreements between undertakings which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the internal market are prohibited as incompatible with the internal market of the European Union. The Competition Act 1998, s 2 makes the same provision in relation to agreements which may affect trade within the United Kingdom, and which prevent, restrict or distort competition within the United Kingdom.
Two of the appeals were brought from the Commercial Court, and one from the Competition Appeal Tribunal (CAT). The CAT decided in Sainsbury’s v MasterCard that the MIFs charged within the MasterCard payment system were prohibited anti-competitive agreements, whilst the two Commercial Court judges decided, for different reasons, in each of AAM v MasterCard and Sainsbury’s v Visa that the MIFs charged were not prohibited anti-competitive agreements. The Court of Appeal had to resolve the considerable differences of approach between the three decisions under appeal.
The Court allowed the merchants’ appeals, finding that the MIFs constitute a restriction of competition contrary to TFEU, art 101(1) and that the judge at first instance should have concluded that MasterCard had not established entitlement to an exemption under art 101(3). It remitted all three cases to the CAT for reconsideration of the art 101(3) exemption issue and for the assessment of the quantum of the claims.
Christopher Brown was involved in this case.
 EWCA 1536 (Civ)https://www.judiciary.uk/wp-content/uploads/2018/07/mastercard-appeals-judgment.pdf
Court's Press Summaryhttps://www.judiciary.uk/wp-content/uploads/2018/07/mastercard-appeals-press-summary.pdf