Sainsbury's Supermarkets Ltd v Mastercard Incorporated & Ors (Rev 1) [2018] EWCA Civ 1536 (04 July 2018)

Sainsbury's Supermarkets Ltd v Mastercard Incorporated & Ors (Rev 1) [2018] EWCA Civ 1536 (04 July 2018)

The Court of Appeal held that the setting of default MIFs by MasterCard and Visa restricted competition in the acquiring market under Article 101(1) TFEU. The MIFs were not objectively necessary for the operation of the schemes (ancillary restraint doctrine not satisfied). The schemes failed to establish that the MIFs were exempt under Article 101(3) TFEU, as they did not prove the requisite efficiencies or fair share of benefits to consumers. The Court also addressed the quantum of damages and the pass-on defence, holding that the burden of proof for pass-on lies on the defendant and that insufficient evidence was provided to reduce damages for pass-on in the Sainsbury's case.

Citation
[2018] EWCA Civ 1536
Parties
Claimant/respondent; Claimant/appellant: Sainsbury's Supermarkets Limited; Defendant/respondent: MasterCard Incorporated; Defendant/respondent: MasterCard International Incorporated; Defendant/respondent: MasterCard Europe SA (formerly known as MasterCard Europe SPRL); Claimant/appellant: Asda Stores Limited; Claimant/appellant: Arcadia Group Brands Limited and others; Claimant/appellant: Argos Limited and others; Claimant/appellant: WM Morrison Supermarkets PLC; Defendant/respondent: MasterCard/Europay UK Limited; Defendant/respondent: Visa Europe Services LLC; Defendant/respondent: Visa Europe Ltd; Defendant/respondent: Visa UK Ltd; Intervener: The European Commission
Jurisdiction
England and Wales
Judgment Date
04 July 2018
Procedural Posture
Civil Appeal / Court of Appeal Judgment on Appeals From Competition Appeal Tribunal and High Court
Outcome
Appeals allowed in part; findings of infringement of Article 101(1) TFEU against MasterCard and Visa restored; matters relating to quantum and pass-on remitted for further determination.
Legal Topics
Article 101 TFEU, Multilateral Interchange Fees (mifs), Ancillary Restraint Doctrine, Article 101(3) Exemption, Pass on Defence, Quantum of Damages
Competition Law European Union Law Commercial Law Article 101 TFEU Multilateral Interchange Fees (mifs) Ancillary Restraint Doctrine Article 101(3) Exemption Pass on Defence +1 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 5 Authorities cited 13 Party arguments 2 Amounts and remedies 2
Sign in to unlock

Parties

Sainsbury's Supermarkets Limited

Claimant/respondent; Claimant/appellant

MasterCard Incorporated

Defendant/respondent

MasterCard International Incorporated

Defendant/respondent

MasterCard Europe SA (formerly known as MasterCard Europe SPRL)

Defendant/respondent

Asda Stores Limited

Claimant/appellant

Arcadia Group Brands Limited and others

Claimant/appellant

Argos Limited and others

Claimant/appellant

WM Morrison Supermarkets PLC

Claimant/appellant

MasterCard/Europay UK Limited

Defendant/respondent

Visa Europe Services LLC

Defendant/respondent

Visa Europe Ltd

Defendant/respondent

Visa UK Ltd

Defendant/respondent

The European Commission

Intervener

Procedural Posture

Civil Appeal / Court of Appeal Judgment on Appeals From Competition Appeal Tribunal and High Court

Legal Issues

  1. 1 Whether the setting of default multilateral interchange fees (MIFs) by MasterCard and Visa contravenes Article 101(1) TFEU
  2. 2 Whether the MIFs are objectively necessary (ancillary restraint doctrine)
  3. 3 Whether the MIFs are exempt under Article 101(3) TFEU

Ratio Decidendi

The Court of Appeal held that the setting of default MIFs by MasterCard and Visa restricted competition in the acquiring market under Article 101(1) TFEU. The MIFs were not objectively necessary for the operation of the schemes (ancillary restraint doctrine not satisfied). The schemes failed to establish that the MIFs were exempt under Article 101(3) TFEU, as they did not prove the requisite efficiencies or fair share of benefits to consumers. The Court also addressed the quantum of damages and the pass-on defence, holding that the burden of proof for pass-on lies on the defendant and that insufficient evidence was provided to reduce damages for pass-on in the Sainsbury's case.

Court Disposition

Appeals allowed in part; findings of infringement of Article 101(1) TFEU against MasterCard and Visa restored; matters relating to quantum and pass-on remitted for further determination.

Orders

  • Findings of infringement of Article 101(1) TFEU against MasterCard and Visa restored.
  • Matters relating to quantum and pass-on remitted to the Competition Appeal Tribunal or High Court for further determination.