Firms urged to join card fees lawsuit Ian Taylor


Travel companies of all sizes are being invited to join a class action lawsuit against Mastercard and Visa, seeking repayment of at least £1.5 billion in service fees. Harcus Parker, a law firm


specialising in group litigation, is poised to bring a claim at the Competition Appeal Tribunal (CAT) for repayment of Multilateral Interchange Fees (MIFs) on corporate card transactions and the ‘inter-regional fees’ on payments by overseas cardholders. The CAT is the UK court


that hears competition cases and MIFs make up most of the service


charges banks levy on businesses for processing card payments. Visa and Mastercard set the rates of MIFs and ‘inter-regional fees’ and Harcus Parker lawyers will argue they forced banks to charge “anti-competitive and unlawful” rates. The European Commission ruled


such fees on EU consumer card transactions broke competition law back in 2007. The fees can be up to 1.8% of a corporate card transaction whereas MIFs have been capped at 0.3% on consumer credit card transactions and 0.2% on consumer debit cards since 2015. Jeremy Robinson, competition


litigation partner at Harcus Parker, said: “This case is about making a


Healey calls for higher deposits to curb cancellations


Robin Murray


Vertical Travel Group conference, Paphos, Cyprus


The chief executive of homeworking specialist Vertical Travel Group has called on operators to raise deposits to combat rising numbers of holiday cancellations. Peter Healey said the number of


customers pulling their plans was one of the biggest issues facing the sector and that he expected the problem to worsen as the cost of living increases. Many operators and airlines


introduced low deposits and added 4 7 APRIL 2022


flexibility on booking changes to spur sales during the pandemic. However, Healey said that


approach was now presenting a “big challenge” for homeworkers across its brands including Holiday Elite and Your Holiday Booking. “One of the biggest issues we have


now is tour operators competing with each other for the lowest possible deposit,” he told Travel Weekly. “This means people aren’t cancelling because they need to cancel, they’re cancelling because they can cancel, and cancellations are a big challenge.” Speaking at Vertical Travel


This case is about making a stand against unlawful interchange fees


stand against unlawful interchange fees. The Supreme Court and European Court of Justice have both condemned this practice for consumer credit and debit cards. UK courts should now clamp down on commercial card and inter-regional fees.” Robinson told Travel Weekly:


“When a customer buys from a travel business [with a card], the business


pays its bank a merchant service charge (MSC). Most of the MSC is made up of an ‘interchange fee’, which banks pay to one another, but this Multilateral Interchange Fee is not set by the banks. It is set by Visa and Mastercard.” The class action is open to all


travel firms, large or small. Those with an annual pre-Covid turnover of £100 million or more just need to opt into the claim. Businesses with turnover below £100 million will automatically be included unless they opt out. An initial CAT hearing is


expected before the end of the year, with a decision on whether the case


can go to trial within months of that. i Full story, back page


Peter Healey


Group’s conference in Cyprus, he added: “Many consumers pay around £50 for their deposit and when it comes to the actual balance payment, it suddenly looks like a big number, so they decide to do something cheaper instead. “Operators could bring down the


number of cancellations by increasing deposits to a sensible number. I think £120 a head would be reasonable.” Healey said the industry was


“yet to see the true fallout” of the pandemic, adding that he hoped the Vertical group’s turnover would return to pre-pandemic levels by 2023.


“We feel like we’re running at


about 70% of what we should be running at right now,” he said. “This year we’ll turn over about £75 million across the group, but it should be £100 million. Our aim is to achieve that number in 2023.” He added that Vertical Travel


Group was in a “strong position”, partly due to investment during the pandemic by the company’s technology arm Vertical Systems, which had “moved the business forward when it might have been


easier to batten down the hatches”. i Vertical conference, page 12


travelweekly.co.uk


PICTURE: Steve Dunlop


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