MasterCard Inc. agreed to pay Tesco Plc $61 million as the U.K. retailer reached a settlement as part of a multi-billion dollar lawsuit over credit card fees.
"We have been settling with Tesco, which is the largest merchant claimant in this litigation," Martina Hund-Mejean, Purchase, New York-based MasterCard's chief financial officer, said on the company's earnings call July 29. "We are pleased that that is behind us."
More than 20 U.K. retailers are suing MasterCard in London over the fees charged by the payments company in transactions using its credit and debit cards. MasterCard has filed responses to the remaining retailers' claims in court.
Tesco sued MasterCard in 2014 to "recover the historic overpayment of anti-competitive interchange fees. These proceedings have now been settled and discontinued on mutually acceptable terms," a spokesperson for Cheshunt, England-based Tesco said in an e-mail.
In addition to the U.K. lawsuit, the European Union earlier this month sent MasterCard a formal complaint, which could lead to fines, over "artificially high" card-payment fees. The EU's statement of objections targets measures thwarting cross-border competition among banks that offer card services to retailers as well as excessive fees when foreign visitors go shopping in the 28-nation bloc.
MasterCard says interchange fees facilitate electronic payments globally by balancing the benefits and costs of the system among its participants.
