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A landmark £14bn case against Mastercard over alleged illegal card fees is free to proceed after a court ruling.
Walter Merricks, the former Financial Ombudsman, launched legal action against the card provider in September 2016, claiming damages on behalf of 46 million consumers.
The case concerns potential losses suffered as a result of card fees charged to businesses for accepting payments from consumers, which were set by Mastercard and paid to banks, known as interchange fees.
Mr Merricks said these businesses passed on the costs to consumers by increasing prices in the 16 years to 2008.
The Court of Appeal has set aside an earlier judgment made by the Competition Appeal Tribunal, stating that the previous ruling contained errors of law. While this decision has not established any liability against Mastercard, the ruling will allow the legal action against the company to proceed.
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 has pocketed the profits. Since then it has done nothing to apologise, let alone to pay back the money it wrongly caused us to pay out.”
A spokesman for Mastercard said the company continues to "disagree fundamentally" with the basis of the claim.
“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,” the firm said.
The Merricks case is the first mass consumer claim since a new rule regarding collective action were introduced in the Consumer Rights Act 2015.
Boris Bronfentrinker of Quinn Emanuel Urquhart & Sullivan, representing Mr Merricks, said: “The Court of Appeal’s judgment marks a significant day for the collective action regime in this country, after a number of false starts before the Competition Appeal Tribunal.
“This is a satisfying victory, but the focus now shifts to securing compensation for the 46 million UK consumers who lost out as a result of Mastercard’s action.”
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