The House of Lords has confirmed that UK credit card companies can be held liable under the Consumer Credit Act for breaches of contract or misrepresentations arising out of foreign credit card transactions.
The decision makes the card issuer jointly liable with the supplier where the misrepresentation or breach of contract applies to a purchase of between £100 and £30,000 and gives rise to a valid claim by the consumer.
The ruling will come as a welcome relief to holidaymakers who will now benefit from protection on their holiday purchases in certain cases. In practical terms, it is likely that banks will seek to recoup the extra cost by a slight amendment to the exchange rate applied in foreign currency transactions.
