Sainsbury's Supermarkets Ltd v Visa Europe Services LLC & Anor

Sainsbury's Supermarkets Ltd v Visa Europe Services LLC & Anor

Visa’s UK MIFs do not restrict competition within the meaning of Article 101(1) TFEU or s.2 Competition Act 1998 because, on the evidence, in the absence of MIFs the market would default to settlement at par with no bilateral agreements, resulting in no greater competition. The MIFs do not alter the competitive process in the acquiring market, and the mere fact that they set a default price does not amount to a restriction of competition. There is no economic, practical, or legal distinction between a zero MIF and a no-MIF default settlement at par. Accordingly, Sainsbury’s claim fails.

Parties
Claimant: Sainsbury’s Supermarkets Ltd; Defendant: Visa Europe Services LLC; Defendant: Visa Europe Ltd; Defendant: Visa UK Ltd
Jurisdiction
England and Wales
Judgment Date
30 November 2017
Procedural Posture
Commercial Court Claim (competition Law, Damages) / Judgment After Trial on Liability and Certain Quantum Issues (phase 1)
Outcome
Claim dismissed
Legal Topics
Article 101 TFEU, Multilateral Interchange Fees (mifs), Restriction of Competition, Objective Necessity, Counterfactual Analysis, Ancillary Restraints, Competition Act 1998 S.2 and S.9
Competition Law Commercial Law European Union Law Article 101 TFEU Multilateral Interchange Fees (mifs) Restriction of Competition Objective Necessity Counterfactual Analysis +2 more

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Parties

Sainsbury’s Supermarkets Ltd

Claimant

Visa Europe Services LLC

Defendant

Visa Europe Ltd

Defendant

Visa UK Ltd

Defendant

Procedural Posture

Commercial Court Claim (competition Law, Damages) / Judgment After Trial on Liability and Certain Quantum Issues (phase 1)

Legal Issues

  1. 1 Whether Visa's UK Multilateral Interchange Fees (MIFs) restricted competition contrary to Article 101(1) TFEU and s.2 Competition Act 1998
  2. 2 Whether any restriction was objectively necessary for the operation of the Visa Scheme
  3. 3 Whether Sainsbury’s is entitled to damages for overcharge due to unlawful MIFs

Ratio Decidendi

Visa’s UK MIFs do not restrict competition within the meaning of Article 101(1) TFEU or s.2 Competition Act 1998 because, on the evidence, in the absence of MIFs the market would default to settlement at par with no bilateral agreements, resulting in no greater competition. The MIFs do not alter the competitive process in the acquiring market, and the mere fact that they set a default price does not amount to a restriction of competition. There is no economic, practical, or legal distinction between a zero MIF and a no-MIF default settlement at par. Accordingly, Sainsbury’s claim fails.

Court Disposition

Claim dismissed

Orders

  • Sainsbury’s claim is dismissed in its entirety.