1.1 	A bill for an act
1.2 	relating to commerce; prohibiting unreasonable blocks
1.3 	on a customer's access to credit capacity on a credit
1.4 	card or debit card; proposing coding for new law in
1.5 	Minnesota Statutes, chapter 325G.
1.6 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.7 	Section 1. [325G.052] UNREASONABLE CREDIT BLOCKING
1.8 	PROHIBITED.
1.9 		Subdivision 1.Definitions. (a) For purposes of this
1.10 	section, the terms defined in this subdivision have the meanings
1.11 	given them.
1.12 	(b) "Capacity" means a dollar amount of available credit in
1.13 	the case of a credit card, and a dollar amount of the account
1.14 	balance or overdraft capacity in the case of a debit card.
1.15 	(c) "Credit block" means an arrangement between a retailer
1.16 	and an issuer, in which the issuer, at the request of a
1.17 	retailer, reserves, prior to completion of a purchase, a
1.18 	specified dollar amount of the customer's purchasing capacity
1.19 	for use in connection with a purchase initiated by a customer
1.20 	with the retailer.
1.21 	(d) "Issuer" means the entity that issued the credit card
1.22 	or debit card or an entity that administers credit blocks on
1.23 	behalf of the issuer.
1.24 	(e) "Retailer" means a gasoline retailer, a hotel or
1.25 	similar short-term lodging facility, or a rental car company.
2.1 		Subd. 2.Gasoline credit blocks limited. (a) A gasoline
2.2 	retailer must release a credit block as soon as possible after
2.3 	the gasoline purchase has been completed or otherwise ended.
2.4 	The credit block must in any case be released before the end of
2.5 	the gasoline retailer's business day.
2.6 	(b) A gasoline retailer must not initiate a credit block
2.7 	for a dollar amount that exceeds the price per gallon for the
2.8 	most expensive type of gasoline sold by the retailer multiplied
2.9 	by 24.
2.10 		Subd. 3.Hotel credit blocks limited. (a) A hotel or
2.11 	similar short-term lodging facility must release a credit block
2.12 	as soon as possible after the customer's stay has ended and the
2.13 	hotel has authorization to charge against the customer's credit
2.14 	or debit card.  The credit block must in any case be released
2.15 	before the end of the hotel's business day.
2.16 	(b) A hotel or similar short-term lodging facility must not
2.17 	initiate a credit block for an amount that exceeds the number of
2.18 	days of the customer's reservation multiplied by 110 percent of
2.19 	the daily rate to be charged to the customer for the room,
2.20 	including all taxes.
2.21 		Subd. 4.Rental car credit blocks limited. (a) A rental
2.22 	car company must release a credit block as soon as possible
2.23 	after the return of the vehicle.  The credit block must in any
2.24 	case be released before the end of that business day.
2.25 	(b) A rental car company must not initiate a credit card
2.26 	block for a dollar amount that exceeds the number of days of the
2.27 	customer's reservation multiplied by the daily rental rate being
2.28 	charged to the customer, including all taxes, plus an additional
2.29 	$30.
2.30 		Subd. 5.Enforcement. (a) No one may bring a private
2.31 	cause of action under this section unless the individual has
2.32 	first in good faith attempted to correct the problem with the
2.33 	party violating the section.
2.34 	(b) This section may be enforced under section 8.31,
2.35 	including the private cause of action under subdivision 3a of
2.36 	that section.  In a private cause of action, a retailer that has
3.1 	violated this section is liable to the customer for statutory
3.2 	damages of $1,000, plus actual damages if any.
3.3 	
EFFECTIVE DATE. This section is effective August 1, 2005.