Credit Cards and Merchant Fees Recent Legislation
Last Updated: April 13, 2007
NCSL Contact: Heather Morton, Denver (303) 364-7700
2007 Legislation
Florida
H.B. 17
Specifies absence of dealer liability to state for certain payment card transaction rates, charges, or fees; specifies such rates, charges, or fees as credit against and deduction from certain sales and use tax requirements; provides return requirement.
S.B. 1724
Specifies absence of dealer liability to state for certain payment card transaction rates, charges, or fees; specifies such rates, charges, or fees as credit against and deduction from certain sales and use tax requirements; provides return requirement.
Kansas
S.B. 349
Places restrictions on what can be included in the contract between a financial institution and a merchant regarding the acceptance of credit and debit cards. The contract cannot give a financial institution the right to charge a merchant the cost of a credit or debit card transaction because the cost of the transaction exceeds a predetermined amount. The bill also states that a contract may not require a merchant to limit or waive its rights. The bill includes a civil penalty of $5,000 per violation and would allow a merchant the option to sue a financial institution for damages if the merchant’s rights granted by this bill are violated.
S.B. 350
Relates to merchants; provides for access to certain credit and debit card rate information; defines interchange fee.
Nebraska
L.B. 174
Relates to financial institutions; provides duties for and prohibits certain actions by issuers of credit and debit cards regarding fees; provides penalties.
Nevada
A.B. 532
Prohibits certain fees to be charged to certain transactions involving a credit card or debit card. This bill also provides for the imposition of a civil penalty of $5,000 for each violation, which is recoverable by the attorney general. Finally, this bill authorizes a merchant who is damaged as a result of a violation to bring a civil action to recover his damages, costs and reasonable attorney's fees.
Oklahoma
H.B. 1962
Prohibits certain contract provisions regarding credit card transaction fees.
Tennessee
H.B. 1019
S.B. 850
Prohibits persons who issue credit and debit cards from charging retail merchants who conduct at least 80 percent of their credit card transactions through a credit card terminal more than .75 percent for all processing fees involving the use of a credit or debit card. Any violation of this bill would be a violation of the Tennessee Consumer Protection Act of 1977, thereby subjecting the violator to the penalties of that Act, including treble damages. This bill only applies to contracts between credit card issuers and merchants that are entered into on or after July 1, 2007.
Texas
S.B. 1322
Relates to a merchant's acceptance of a credit card or debit card, defines interchange fee.
Washington
S.B. 5065
Declares that "interchange fee" means the fee a merchant's financial institution pays to a cardholder's financial institution when a cardholder uses a credit card or debit card as payment during a retail transaction. Declares that financial institutions may not charge interchange fees that are more than one and one-half percent of the total cost of the retail transaction.
S.B. 5884
Requires the state to reimburse a retail seller for the state portion of any sales tax paid on interchange fees. Defines "interchange fee" to mean the fee a merchant's financial institution pays to a cardholder's financial institution when a cardholder uses a credit card or debit card as payment during a retail transaction.
S.B. 5885
Prohibits financial institutions from charging interchange fees on the state sales tax portion of a retail sale transaction. Defines "interchange fee" to mean the fee a merchant's financial institution pays to a cardholder's financial institution when a cardholder uses a credit card or debit card as payment during a retail transaction.
S.J.M 8020
Requests congressional action to limit credit card interchange fees and to develop clear and concise consumer disclosure on such fees.
2006 Legislation
Alabama
H.R. 790
Urges the Judiciary Committee of the U.S. Senate to conduct hearings on interchange fees charged on credit card and other electronic transactions.
S.R. 147
Passed Senate 4/17/06
Urges the Judiciary Committee of the U.S. Senate to conduct hearings on interchange fees charged on credit card and other electronic transactions.
Kentucky
H.B. 592
Creates a new section of KRS Chapter 367 to require that discount rates, transaction charges, interchange rates, or any other charges and fees charged to merchants or deducted from credit card sales for processing credit card transactions where the charges or fees are a percentage multiplied by the gross dollar amount of the credit card transaction must be based on the dollar amount of the credit card sale excluding any taxes on the sale; declares that any such fees shall not be applied to the tax portion of any credit card sales; provides that violation of this section is an unfair, false, misleading, or deceptive act or practice in the conduct of trade or commerce in violation of KRS 367.170.
New York
A.B. 11193
Prohibits the imposition of interchange rates or transaction fees on the sales tax portion of credit or debit card charges where the fee or change is a percentage of the gross dollar amount of the credit or debit card transaction.
Tennessee
H.B. 3875
S.B. 3813
Prohibits persons who issue credit and debit cards from charging retail merchants who conduct at least 80 percent of their credit card transactions through a credit card terminal more than .75 percent for all processing fees involving the use of a credit or debit card. Any violation of this bill would be a violation of the Tennessee Consumer Protection Act of 1977. This bill only applies to contracts between credit card issuers and merchants that are entered into on or after July 1, 2006.
Washington
S.B. 6240
Declares that "interchange fee" means the fee a merchant's financial institution pays to a cardholder's financial institution when a cardholder uses a credit card or debit card as payment during a retail transaction. Provides that financial institutions may not charge interchange fees that are more than one and one-half percent of the total cost of the retail transaction.
2005 Legislation
New York
A.B. 5224
Requires those who contract with a retailer to process retail installment credit agreements (credit card slips) to report to the banking department on the amount or percentage charged to retail merchants or outlets for processing credit card purchase slips in each instance and directs superintendent of banks to review nature and effects of such charges and report thereon to the governor and legislature, together with his recommendations as to mandating public disclosure and possible uniformity of such charges.
 Return to CFI Committee's 2007 Spring Forum Agenda
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