Canada’s Big Six banks, and a handful of other financial institutions, have been ordered to reimburse credit card customers more than $200 million in foreign currency transaction fees in a Quebec Superior Court judgment.

Justice Clément Gascon ruled on Thursday that the country’s biggest banks, along with Desjardins Group, Laurentian Bank of Canada, Citibank Canada and Amex Bank, violated Quebec’s consumer protection laws by charging fees for foreign currency transactions on credit cards.

The ruling, which applies to three separate class-action suits against the banks, covers customers who conducted foreign currency transactions between 2000 and 2007 using Visa, MasterCard and American Express cards.

The judge agreed with the complainants that the fees were essentially a form of interest charged on purchases. Under the Quebec Consumer Protection Act, credit-card interest cannot be billed to consumers before the end of the grace period, and therefore customers who paid their balance before the mandatory grace period should not have been required to pay the fees, according to the judgment.

The ruling refutes the banks’ stance that they should not be subject to provincial consumer protection legislation since they operate under federal law.

The Canadian Bankers’ Association said the banks may decide to appeal the decision to the Supreme Court of Canada.

“We have just received the court’s decision,” the association said in a statement. “The banks will be reviewing the decision in more detail with their legal counsel and considering its implications and whether or not there are grounds for an appeal.”

The banks have 30 days to appeal or develop a plan for reimbursement.

IE