In the UK, consumers paying for goods with a credit card are protected by a provision in the Consumer Credit Act of 1974 that allows them to make a claim directly against their credit card company or the supplier if they discover problems with goods or services purchased with their card.
The credit card issuer and the supplier are jointly liable if the consumer has a valid claim for misrepresentation and/or breach of contract by the supplier – provided the cash price of an item is over £100 and less than £30,000, and the credit limit is no more than £25,000.
But there has always been a question mark over whether this protection applies to goods purchased overseas and in July the OFT asked the High Court to issue a definitive declaration that it did.
Card issuers Lloyds TSB, Tesco Personal Finance (part of The Royal Bank of Scotland group) and American Express Services Europe Limited opposed the motion, arguing that there is no such protection.
In November the High Court found in favour of the card issuers, ruling that domestic transactions – whether from a shop, by mail order, by telephone or over the internet – are protected, but overseas transactions using a credit card are, in general, not protected at all.
The OFT announced yesterday that it would appeal the ruling to the Court of Appeal.
