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Almost every adult in Britain could receive £300 windfall from Mastercard after landmark ruling
Legal action on behalf of British consumers claims UK residents paid unfairly high fees to the company
NEARLY every adult in the UK could be entitled to a £300 payout from Mastercard after a landmark court ruling.
Former financial ombudsman Walter Merricks has brought a £14billion lawsuit against the payment giant, claiming it owes money to 46million consumers.
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Mr Merricks says that's how many UK residents paid more than they should have done in transaction fees charged by Mastercard during a 16-year period.
That means that if his claim goes to trial and he wins, anyone who can prove they were in the UK between 1992 and 2008 will get the £300 payout.
And it doesn't even matter if you didn't even have a Mastercard — the claim is that anyone who made payments in Britain at the time was hit with unfairly high transaction fees.
This is because while shoppers don't explicitly pay these fees they will be passed on by retailers in the form of higher prices.
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Also, if Mr Merricks ultimately wins then everyone entitled to a payout will be paid unless they explicitly refuse it, without having any direct involvement with the trial.
Legal turnaround
It all started in 2007 when the European Commission found Mastercard had breached competition law in relation to setting certain fees charged between banks in Mastercard transactions.
Mastercard was later fined £501million for charging card fees which push up costs for customers and shops.
Mr Merricks on looking into this, launched a lawsuit against the card firm in September 2016.
Then in July 2017, the Competition Appeal Tribunal slapped down Mr Merrick's original claim for damages, saying it would not allow the case to go trial.
The claim was rejected in part because the tribunal couldn't work out how to calculate individual losses caused by Mastercard's fees.
But the Court of Appeal found that was not a legal basis for rejecting court action and has ordered the tribunal to reconsider what is now the biggest class action case in British legal history.
Mr Merricks says the maximum payout would be around £300 for anyone who can prove that they were in the UK between 1992 and 2008.
'Pay the compensation'
In a statement after the new ruling, Mr Merricks said: "I am very pleased with today's decision.
"It is nearly 12 years since Mastercard was clearly told that it had broken the law by imposing excessive card transaction charges, damaging consumers over a prolonged period.
"As a result we all had to pay higher prices in the shops than we should have done — while Mastercard have pocketed the profits.
"It's now time for Mastercard to admit the damage it did, to apologise to the British public, and to agree to pay the compensation it owes."
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But Mastercard says it's willing to fight the lawsuit all the way up to the Supreme Court, so it's unlikely to make any payouts until every legal avenue has been satisfied.
Even if Mastercard fails at the UK's Supreme Court it could then appeal to the European Court of Justice - although this will depend if the UK is still in the EU at this point.
A spokeswoman for the company said: "This decision is not a final ruling and the proposed claim is not approved to move forward, rather the court has simply said a rehearing on certain issues should happen.
"Mastercard continues to disagree fundamentally with the basis of the claim and we believe UK consumers receive real value from the security, convenience and consumer protection of our payment services."
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