MLEX – Author: Simon Zekaria
Visa and Mastercard are facing antitrust damages claims in the UK from Dutch optical retailer GrandVision and a slew of subsidiaries over alleged anticompetitive card network payment fees, MLex has learned.
The two payment card operators are each the subject of a separate claim from 47 plaintiffs at the High Court in London, with the actions lodged by GrandVision and subsidiaries including the UK’s Vision Express and France’s GrandOptical along with Solaris, Synoptik and Interoptik.
Four defendants for each action — corporate entities of both Mastercard and Visa — are listed in the court filings under “competition” suits.
Visa and Mastercard have been hit with dozens of competition-related actions from retailers in the past few years over their “multilateral interchange fees.
Transactions with credit and debit cards worldwide are engineered around the charges — set by the card networks — which are paid by a retailer’s “acquiring” bank to the cardholder’s “issuing” bank. The acquiring bank then deducts a “merchant service charge,” including interchange and other costs, before passing payments on to the retailer.
Companies, regulators and courts for years have scrutinized whether such fees break competition rules.
Opponents say they pinch competition between acquiring banks in breach of antitrust rules and drive up costs for retailers and consumers bound to the system. The card networks say the charges don’t impact on competition and create benefits across the payment system that outweigh negative effects.
Retailers and others have flooded to bring actions over the fees following a European
Commission ruling in 2007 that Mastercard’s fees on cross-border credit and debit card sales breached antitrust rules and inflated the cost of card use for retailers and shoppers.
The commission also hit Visa with charges over the fees in 2002, which prompted the company to make commitments to address concerns. Retailers still sought compensation from the company for alleged losses.
Schiphol-based GrandVision, which has 7,000 stores in 40 countries under various retail banners, filed its actions on June 4.
GrandVision wasn’t immediately available for comment.