HF 3027

as introduced - 89th Legislature (2015 - 2016) Posted on 03/14/2016 03:26pm

A bill for an act
relating to commerce; regulating interchange fees on electronic payment
transactions; providing penalties; proposing coding for new law in Minnesota
Statutes, chapter 325G.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [325G.053] DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Terms. new text end

new text begin For purposes of sections 325G.053 to 325G.058, the terms in
this section have the meanings given them.
new text end

new text begin Subd. 2. new text end

new text begin Electronic payment transaction. new text end

new text begin "Electronic payment transaction" means
a transaction in which a person uses a debit card, credit card, or other payment code or
device, issued or approved through a payment card network to debit a deposit account or
use a line of credit, whether authorization is based on signature, personal identification
number, or other means.
new text end

new text begin Subd. 3. new text end

new text begin Interchange fee. new text end

new text begin "Interchange fee" means a fee established, charged, or
received by a payment card network for the purpose of compensating the issuer for its
involvement in an electronic payment transaction.
new text end

new text begin Subd. 4. new text end

new text begin Issuer. new text end

new text begin "Issuer" means a person issuing a debit card or credit card, or
the issuer's agent.
new text end

new text begin Subd. 5. new text end

new text begin Payment card network. new text end

new text begin "Payment card network" means an entity that:
new text end

new text begin (1) directly, or through licensed members, processors, or agents, provides the
proprietary services, infrastructure, and software that routes information and data to
conduct debit card or credit card transaction authorization, clearance, and settlement; and
new text end

new text begin (2) a merchant or seller uses in order to accept as a form of payment a brand of debit
card, credit card, or other device that may be used to carry out debit or credit transactions.
new text end

new text begin Subd. 6. new text end

new text begin Settlement. new text end

new text begin "Settlement" means the transfer of funds from a customer's
account to a seller or merchant upon electronic submission of finalized sales transactions
to the payment card network.
new text end

Sec. 2.

new text begin [325G.054] INTERCHANGE FEES; LIMITATION.
new text end

new text begin The amount of any tax or fee imposed by state or local government that is calculated
as a percentage of an electronic payment transaction amount and listed separately on the
payment invoice or other demand for payment, or the amount of any fuel taxes imposed
under chapter 296A, must be excluded from the amount on which an interchange fee is
charged for that electronic payment transaction.
new text end

Sec. 3.

new text begin [325G.055] CIRCUMVENTION PROHIBITED.
new text end

new text begin It is unlawful to alter or manipulate the computation and imposition of interchange
fees by increasing the rate or amount of fee applicable to or imposed upon that portion
of an electronic payment transaction not attributable to a state or local tax or fee to
circumvent the effect of section 325G.054.
new text end

Sec. 4.

new text begin [325G.056] DEDUCTION OR REBATE; SETTLEMENT PROCEDURE.
new text end

new text begin A payment card network shall either deduct the amount of any tax or fee imposed as
described in section 325G.054 from the calculation of interchange fees specific to each
form or type of electronic payment transaction at the time of settlement or shall rebate an
amount of interchange fee proportionate to the amount attributable to the tax or fee. The
deduction or rebate shall occur at the time of settlement when the merchant or seller is able
to capture and transmit tax or fee amounts relevant to the sale at the time of sale as part
of the transaction finalization. If the merchant or seller is unable to capture and transmit
tax or fee amounts relevant to the sale at the time of sale, the payment card network
shall accept proof of tax or fee amounts collected on sales subject to an interchange fee
upon the submission of sales data by the seller or merchant and shall promptly credit the
merchant's or seller's settlement account.
new text end

Sec. 5.

new text begin [325G.057] PENALTY.
new text end

new text begin A payment card network that violates any provision of sections 325G.053 to
325G.058 is subject to a civil penalty of not more than $1,000 per violation, paid to the
plaintiff, and shall refund the surcharge to each seller or merchant.
new text end

Sec. 6.

new text begin [325G.058] INTERCHANGE FEES; COMPUTATION.
new text end

new text begin The computation of an interchange fee established, charged, or received by a payment
card network for the purpose of compensating the issuer for its involvement in an electronic
payment transaction shall be governed by the provisions of sections 325G.053 to 325G.058.
new text end

Sec. 7. new text begin EFFECTIVE DATE.
new text end

new text begin Sections 1 to 6 are effective July 1, 2016, and apply to electronic payment
transactions processed on or after that date.
new text end