ContractsProf Blog

Editor: Jeremy Telman
Oklahoma City University
School of Law

Friday, November 26, 2004

British credit card companies breathing easier

British_flag Buying goods from foreign sellers just got a little dicier for British consumers, in the wake of a ruling that domestic British consumer protection laws do not apply to customers who use their credit cards to buy foreign goods and services, according to a report in the Northern Ireland News Letter..

British law apparently provides that consumers who have a complaint against a seller (in an amount between £100 and £30,000) have the option of suing the credit card issuer instead of the seller; the issuer then can go after the seller.  But with the increased use of credit cards overseas and for Internet purchases in foreign countries, the card companies have found themselves becoming virtual insurers—particularly for sellers in countries that lack consumer protection laws or in which suing the seller is difficult.

In a test case, a British judge held that the provision did not extend to foreign sales, since it had been based on the assumption that the credit card company would be able to recover any losses from the seller, and that is not feasible in many international transactions.  Thus, there was no justification for giving the domestic provision extraterritorial effect.

In the News | Permalink

TrackBack URL for this entry:

Listed below are links to weblogs that reference British credit card companies breathing easier: