The ECJ has given a preliminary ruling on its interpretation of certain provisions within the Payment Services Directive (PSD) in T-Mobile Austria GmbH v Verein für Konsumenteninformation (Case C 616/11) (9 April 2014).

T-Mobile sought to impose a service charge on customers who made payment through online banking or by way of a paper transfer order. The defendant, an Austrian consumer association, argued that this was contrary to Austrian legislation (implementing the PSD), which prohibited the levying of charges irrespective of the payment instrument selected. The ECJ ruled that such forms of payment comprised “payment instruments” under Article 4(23) and that Article 52(3) was applicable to the use of a payment instrument in the course of a contractual relationship between a mobile phone operator (T-Mobile) as payee and the operator’s customer as payer and must be interpreted as providing member states with the power to prohibit payees from levying charges on the payer for the use of a payment instrument.

What this means for you

This provides useful clarification on PSD. Member States are entitled to prohibit payees from levying charges on the payer whatever the payment instrument selected, if the national legislation, as a whole, takes into account the need to encourage competition and the use of efficient payment instruments.