# CJEU on Interchange Fees for Co-Branding Cards

> The CJEU clarifies when payments to co-branding partners qualify as net compensation and fall within the cap.

Source: https://www.mtrlegal.com/en/cjeu-interchange-fees-co-branding-cards/ · Language: en · Updated: 2026-10-25

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## CJEU clarifies requirements on interchange fees for co-branding cards

[Court of Justice of the European Union (CJEU), judgment of 16 April 2026](https://eur-lex.europa.eu/./legal-content/AUTO/?uri=CELEX:62023CJ0549_SUM) – C-549/23: The Court of Justice of the European Union ruled on the interpretation of Regulation (EU) 2015/751 on interchange fees for card-based payment transactions. The focus was on payments made by a three-party card payment scheme to a co-branding partner and the question of whether such remuneration must be taken into account for the cap on interchange fees.

The decision concerns in particular Article 2, points 10 and 11, as well as Articles 4 and 5 of Regulation (EU) 2015/751. The Court clarified the conditions under which payments, rebates and incentives to a co-branding partner may be classified as net compensation and how they are to be treated in relation to the Regulation’s anti-circumvention rule.

## Background to the proceedings before the CJEU

### Starting point: co-branding cooperation in card payments

The proceedings were based on a co-branding cooperation between a three-party card payment scheme and an airline. According to the findings in the main proceedings, the cooperation had existed since 2010. As part of the cooperation, [co-branding credit cards](https://www.mtrlegal.com/wiki/kreditkarte/) were issued, combining a payment brand with a non-payment brand.

Part of the cooperation concerned access to the airline’s loyalty programme. Cardholders were able to collect miles in connection with the use of the cards. For this purpose, the card payment scheme acquired miles from the airline and passed them on to cardholders according to card usage.

According to the information provided by the referring court and the parties involved, the remuneration components addressed in the main proceedings included in particular:

- a “Signing Bonus” paid in 2018,
- annual fees for the use of the airline’s brands,
- annual fees for access to the loyalty programme,
- payments for the purchase of miles,
- further payments in connection with the co-branding partnership.

### Proceedings before the Dutch authority and the courts

The Dutch Autoriteit Consument en Markt (ACM, Netherlands Authority for Consumers and Markets) conducted the proceedings under file number ACM/21/039321. The parties involved included American Express Europe S.A., American Express Carte France S.A., KLM, Visa Europe, Mastercard Europe S.A. and International Card Services B.V.

The authority accused American Express of having paid remuneration to KLM that exceeded the cap of 0.3% of the transaction value under Regulation (EU) 2015/751. According to the full text of the source material, the authority issued an order on 6 March 2019 subject to a penalty payment. It should be noted that other published information refers, by way of deviation, to 22 January 2020; according to the account in the source material, that date concerns the later decision on the objections.

According to the information in the main proceedings, in the event of non-compliance from 1 June 2019, a penalty payment of EUR 500,000 per day or part thereof was to be forfeited, up to a maximum amount of EUR 10 million. By recovery decision of 21 December 2020, the authority demanded payment of forfeited penalty payments in the amount of EUR 10 million.

The Rechtbank Rotterdam (District Court of Rotterdam) annulled the order on 18 November 2021. According to its reasoning, the authority had not sufficiently demonstrated that certain remuneration had the same purpose and the same effect as interchange fees. The proceedings against that decision were continued before the College van Beroep voor het bedrijfsleven (Administrative Court of Appeal for Trade and Industry). It stayed the proceedings and, by interim decision of 29 August 2023, referred several questions to the CJEU for a preliminary ruling. Following the reference, the main proceedings are to be continued before the College van Beroep voor het bedrijfsleven.

## Legal framework of Regulation (EU) 2015/751

### Cap for consumer credit card transactions

Article 4 of Regulation (EU) 2015/751 caps interchange fees for consumer credit card transactions. Accordingly, the interchange fee that payment service providers may offer or request per payment transaction may not exceed 0.3% of the transaction value. For domestic credit card transactions, Member States may set a lower cap.

Article 2, point 10 of the Regulation defines the interchange fee as a fee paid for each direct or indirect transaction between the issuer and the acquirer involved in a card-based payment transaction. Net compensation or other agreed remuneration forms part of the interchange fee under this definition.

### Net compensation and anti-circumvention rule

Article 2, point 11 of the Regulation defines net compensation as the total net amount of payments, rebates and incentives received by an issuer from the card payment scheme, the acquirer or any other intermediary in relation to card-based payment transactions or related activities.

Article 5 of the Regulation contains an anti-circumvention rule. Accordingly, for the application of the caps, any agreed remuneration, including net compensation, is treated as part of the interchange fee if it has the same purpose or effect as an interchange fee and an issuer receives it from the card payment scheme, the acquirer or any other intermediary in relation to payment transactions or related activities.

## Three-party schemes with co-branding partners

### Equal treatment with four-party card payment schemes

Under the Regulation, three-party card payment schemes are, in principle, not treated in every respect in the same way as four-party schemes. However, an important exception exists where a three-party card payment scheme licenses other payment service providers or issues card-based payment instruments together with a co-branding partner or through an agent.

In these circumstances, the three-party card payment scheme is treated as a four-party card payment scheme. The CJEU builds on this and emphasises that this equal treatment serves the objective of creating comparable competitive conditions and capturing implicit interchange fees.

### Co-branding partner need not be an issuer

The Court clarified that a co-branding partner does not itself have to be an issuer within the meaning of Article 2, point 2 of the Regulation for the relevant rules to apply. What matters is that the three-party card payment scheme issues card-based payment instruments together with a co-branding partner.

The CJEU thus continues the line of case law according to which equal treatment does not depend on whether the co-branding partner is involved in card issuance in the capacity of an issuer. Otherwise, the objectives of the Regulation, in particular a level playing field and a limitation of transaction costs, could be impaired.

## Classification of payments to co-branding partners

### Net compensation possible even for payments to non-issuers

The CJEU held that the total net amount of payments, rebates and incentives that a co-branding partner receives from a three-party card payment scheme may be classified as net compensation within the meaning of Article 2, point 11 of the Regulation. This also applies where the co-branding partner is not itself an issuer.

However, this is subject to the condition that the remuneration components concerned have the same purpose or the same effect as an interchange fee. The Court thereby avoids a schematic classification of all payments to co-branding partners. The decisive factor remains the functional proximity of the remuneration to an interchange fee.

### Classification under the anti-circumvention rule

The CJEU further found that net compensation is not brought within the scope of the cap directly through Article 4 of the Regulation, but through the anti-circumvention rule in Article 5. Article 4 contains the cap for interchange fees. Article 5 governs which other agreed remuneration is to be treated like an interchange fee because of its purpose or effect.

Article 5 therefore has a central function. The provision is intended to prevent economically equivalent payments from being made outside the formal designation as an interchange fee and thereby circumventing the caps set by the Regulation.

## Standard: same purpose or same effect

### Alternative conditions

The Court emphasised that Article 5 of the Regulation contains alternative criteria. Remuneration falls under the provision if it has either the same purpose or the same effect as an interchange fee. It is not necessary for both conditions to be met cumulatively.

For payments to a co-branding partner, this means that it must be examined whether the remuneration corresponds to an interchange fee in terms of its objective or its economic effects. The specific connection with payment transactions or with activities linked to the cards in question is decisive.

### Significance of incentives for card usage

According to the CJEU, particular consideration must be given to whether the purpose or effect of the remuneration is to incentivise consumers to use the cards. In this context, the Court refers to incentive mechanisms such as marketing incentives, rewards or rebates, which may have a comparable economic function in card payments.

Remuneration may therefore be covered if it is structured directly by reference to volume or transactions. It may also be covered, however, if it is not directly linked to individual transactions but nevertheless has an effect on the use of the card.

The assessment of whether specific remuneration has the same purpose or the same effect remains a matter for the referring court. It must assess the characteristics of the agreed remuneration and its economic connection with the card payment scheme.

## Merchant service charge is not deductible

### Distinction from the status as payee

The CJEU also held that a merchant service charge paid by a co-branding partner to a three-party card payment scheme may not be deducted from the payments, rebates and incentives that that partner receives from the card payment scheme.

Article 2, point 12 of the Regulation defines the merchant service charge as a fee paid by the payee to the acquirer in relation to card-based payment transactions. The Court relies on the fact that a co-branding partner may act in a dual role: on the one hand, it may be a co-branding partner and, on the other, it may accept card payments as a merchant or payee.

### No set-off against remuneration from the partnership

According to the decision, the merchant service charge is paid not in the capacity as co-branding partner, but in the capacity as payee. It is not connected with the co-branding partnership as such. It therefore cannot be deducted from the payments made by the card payment scheme to the co-branding partner when calculating net compensation.

This distinction is significant for the calculation because it prevents fees from the merchant relationship from being mixed with remuneration from the co-branding cooperation.

## Deduction of monetary and non-monetary consideration

### Not only cash payments may be taken into account

The Court also addressed the question of whether, when calculating net compensation, only monetary consideration or also non-monetary services provided by the co-branding partner are deductible. It held that not only monetary remuneration may be deducted.

Non-monetary services provided by the co-branding partner to the three-party card payment scheme may also be taken into account in the calculation. The condition is that they are valued according to their actual economic value.

### Valuation according to actual economic value

The CJEU rejected a purely contractual valuation as the sole decisive criterion. Otherwise, the value of non-monetary services could be set too high in order to offset, for calculation purposes, payments made by the card payment scheme to the co-branding partner. This would run counter to the objectives of the Regulation.

The decisive factor is therefore the actual economic value of the service provided. If a comparable service can be acquired from third parties and a publicly ascertainable price exists for it, that circumstance may be taken into account in the valuation. The specific valuation is a matter for the national court.

## Significance of the officially published operative part

The operative part of the judgment was published on 22 June 2026 in the Official Journal of the European Union under number C/2026/3132. According to it, the total net amount of payments, rebates and incentives that a co-branding partner receives from a three-party card payment scheme may be regarded as net compensation, even though the partner is not itself an issuer.

The officially published operative part also confirms that this net compensation is covered by the anti-circumvention rule. When calculating it, not only monetary consideration but also non-monetary benefits may be deducted from the total amount received by the co-branding partner, provided they are valued according to their actual economic value.

## Status of the proceedings and classification for the main proceedings

The preliminary ruling procedure answers the questions on the interpretation of EU law referred by the College van Beroep voor het bedrijfsleven. The national court will decide on the application of these standards to the specific payments in the main proceedings.

In particular, the CJEU has not itself conclusively determined whether each individual payment disputed in the main proceedings exceeded the cap. That assessment remains reserved to the referring court. The decisive criteria are those formulated by the Court regarding the same purpose or the same effect as an interchange fee.

## Key points of the decision

The decision can be summarised in several points:

- A co-branding partner does not itself have to be an issuer for payments to it to be classified as net compensation.
- Net compensation falls within the scope of the anti-circumvention rule under Article 5 of Regulation (EU) 2015/751.
- It is sufficient if remuneration has the same purpose or the same effect as an interchange fee.
- In the assessment, it must be taken into account whether the purpose or effect of the remuneration creates an incentive for consumers to use the card.
- Merchant service charges paid by the co-branding partner in its capacity as payee are not deductible.
- Monetary and non-monetary consideration provided by the co-branding partner may be deducted if it is valued according to its actual economic value.

## Relevance for banking and payment services law

The decision concerns the distinction between classic interchange fees and economically comparable remuneration models in card payment schemes. It is relevant for market participants that structure co-branding models, reward programmes or other incentive systems in connection with card payments.

MTR Legal Rechtsanwälte advises companies, investors and high-net-worth individuals on issues of banking and payment services law, in particular on regulatory requirements, contractual structures and disputes with supervisory authorities. Anyone with legal questions in connection with card fees, co-branding models or Regulation (EU) 2015/751 can find further information here on [legal advice in banking law](https://www.mtrlegal.com/rechtsberatung/bankrecht/).

ECLI:EU:C:2026:295