Mastercard and Visa face billion-pound payouts to retailers after top court case in the UK

Retailers including Asda and Argos are in line for potential billion-pound payouts after the UK’s highest court ruled that transaction fees charged by Visa and Mastercard breached competition laws.

The UK's top judges ruled in favour of retailers including J Sainsbury Plc in a blow to credit-card companies that could now face billions of pounds in damages.

The Supreme Court dismissed an appeal by Visa Inc. and Mastercard Inc., ruling that fees the companies were charging shops restrict competition.

The long-running litigation now allows Sainsbury as well as other supermarkets including Wal-Mart Stores Inc.'s Asda and Wm Morrison Supermarkets Plc, to proceed to a trial on the size of the damages, the judges said in their unanimous ruling Wednesday. At issue is so-called interchange fees, levied by banks at rates set by the card companies each time a consumer's plastic is swiped at a register.

Mastercard's attempt to get a separate tribunal to reconsider some of the issues "offends against the strong principle of public policy and justice that there should be finality in litigation," the judges said.

"The fixing of interchange fees by Mastercard and its network members over many years was an unlawful infringement of competition law," Kate Pollock, a lawyer for some of the supermarket chains said in a statement.

Mastercard insisted that the decision was "not a final ruling."

The damages sought by retailers could run into billions of pounds, although the exact levels of compensation will be decided by the courts in further trials.

"This case will now provide guidance for the hundreds of other business claimants behind the lead cases," said Rob Murray, a lawyer at, who represented Sainsbury.