H.U. for those online purchase's

[sweensdv]

I'm pretty sure that a business/individual can not refuse cash as a payment form as cash is legal tender for any kind of debt. If the business/individual does refuse the offer of the legal tender it can be argued that the debt was satisfied with the offer of the legal tender and the customer owes no further debt.

[Cochese]

I'm pretty sure that a business/individual can not refuse cash as a payment form as cash is legal tender for any kind of debt. If the business/individual does refuse the offer of the legal tender it can be argued that the debt was satisfied with the offer of the legal tender and the customer owes no further debt.

Businesses are required to accept payments denominated in dollars, but not physical dollars themselves.

Unless prohibited by state law, private businesses can refuse cash payments under the Federal Legal Tender law.

Sent from my SAMSUNG-SGH-I747 using Tapatalk 2

[conscience]

No, talking about the same thing. I read that in the article, but the law that we are discussing is federal law. My guess is that the author of the article assumed those state laws would continue to apply after the federal takes effect, but I suspect that is not accurate. However, I have not researched the issue and cannot say definitively at this point.

This actually wasn't a bill but rather the results of a lawsuit between some individual merchants and merchant trade groups against Visa and MasterCard. The prohibition against passing the surcharge along was theirs, not federal law. They knew early on that if people had to pay a surcharge to use Visa/MC they would be more likely to use cash, costing Visa/MC the swipe fee at point of purchase and potential interest on the amount charged by the card holder.

So any state that has, or passes, a law prohibiting it will continue to enforce that law. No federal contradiction here since this isn't a federal law.

Part of the settlement, including 6.6 billion in damages, is a temporary reduction in swipe fees paid by merchants. Another part allows merchants to pass along swipe fees.

Since this agreement was the result of a lawsuit between between private parties against Visa/MC the swipe fee surcharge pass along only applies to those credit card companies. Amex and Discover have separate merchant agreements and are not bound to alter them as they weren't part of the lawsuit or settlement.

[woodturner]

So any state that has, or passes, a law prohibiting it will continue to enforce that law. No federal contradiction here since this isn't a federal law.

It actually is federal law, the Fair Credit Billing Act is a federal law that provides the protections for credit cards, including that a merchant cannot charge a surcharge for use of a credit card but can offer a cash discount.

Specifically (http://www.fdic.gov/regulations/laws...#fdic6500167):
(a) CASH DISCOUNTS.--With respect to credit card which may be used for extensions of credit in sales transactions in which the seller is a person other than the card issuer, the card issuer may not, by contract or otherwise, prohibit any such seller from offering a discount to a cardholder to induce the cardholder to pay by cash, check, or similar means rather than use a credit card.

Section 173 says state laws are subordinate to the FCBA.

The problem was that FCBA caps and limits finance charges, and a credit card surcharge is considered a finance charge. While there was a lawsuit brought that set these events in motion, a change to federal law was required to make it legal to charge a credit card surcharge. As a result, it is federal law that governs, and state laws are subordinate as stated in Section 173. Therefore, having now looked into this in some detail, it seems clear that the state laws referenced will be either struck down or not enforced, since they conflict with federal law.

[conscience]

Specifically (http://www.fdic.gov/regulations/laws...#fdic6500167):
(a) CASH DISCOUNTS.--With respect to credit card which may be used for extensions of credit in sales transactions in which the seller is a person other than the card issuer, the card issuer may not, by contract or otherwise, prohibit any such seller from offering a discount to a cardholder to induce the cardholder to pay by cash, check, or similar means rather than use a credit card.

Section 173 says state laws are subordinate to the FCBA.

The section you are quoting refers to credit card issuers prohibiting cash discounts. Passing along surcharges is an entirely different thing and was prohibited by the merchant agreements created by the credit card companies and not directly regulated by federal law.

This settlement comes from a lawsuit filed in 2005 by over 50 different plaintiffs against Visa, M/C and several large banks over alleged price fixing of the swipe fees. As a side result of the lawsuit, Visa and M/C have agreed to allow merchants to pass along the swipe fee to customers as a surcharge for using a credit card.

Note that American Express and Discover weren't part of the lawsuit and still prohibit merchants from using a surcharge for accepting their cards. That hasn't changed and it would have to if this were a federal law because it would apply to all card issuers equally.

Since this is only a change to the merchant agreement and not federal law, the states that prohibit it will continue to do so because state law trumps company policy.

[woodturner]

The section you are quoting refers to credit card issuers prohibiting cash discounts. Passing along surcharges is an entirely different thing and was prohibited by the merchant agreements created by the credit card companies and not directly regulated by federal law.

No, it is prohibited by the Fair Credit Billing Act as I cited - if you read the sections I cited, it should be clear.

This settlement comes from a lawsuit filed in 2005 by over 50 different plaintiffs against Visa, M/C and several large banks over alleged price fixing of the swipe fees.

I agree that the lawsuit prompted the federal law changes.

Note that American Express and Discover weren't part of the lawsuit and still prohibit merchants from using a surcharge for accepting their cards.

It's legal for a vendor to contractually impose a more stringent requirement, but they can't impose a broader requirement than federal law. So they can prevent the merchant from adding a surcharge, but they couldn't allow them to impose a surcharge, prior to the recent changes to federal law.

Since this is only a change to the merchant agreement and not federal law, the states that prohibit it will continue to do so because state law trumps company policy.

It's not the merchant agreements but the change to federal law that is allowing the surcharges. Since it is federal law, state laws that prohibit surcharges are now invalid.

If you read throught the FCBA and information on the FTC site, this is very clear. If you have some other source of information that contradicts what the FTC and congress are saying, please post it so we can evaluate and discuss the specifics of your source of information.

[conscience]

I'm really not trying to start an argument here, only point out that if your state prevents surcharges then they will continue.

No, it is prohibited by the Fair Credit Billing Act as I cited - if you read the sections I cited, it should be clear.

I read the whole thing before I responded - I hate having to retract something I said. Nowhere does it prohibit merchants from passing along a surcharge to users of credit cards. The Consumer Protections section that you linked to and the clause you specifically quoted, 167(a), prohibits card issuers from not allowing merchants to offer cash discounts. It says nothing about not allowing them to add a surcharge. Section 167(b) doesn't allow merchants to consider cash discounts as a finance charge.

167(a) CASH DISCOUNTS.--With respect to credit card which may be used for extensions of credit in sales transactions in which the seller is a person other than the card issuer, the card issuer may not, by contract or otherwise, prohibit any such seller from offering a discount to a cardholder to induce the cardholder to pay by cash, check, or similar means rather than use a credit card.

Section 173(a) does establish Federal supremacy. 173(b) is again along the lines of 167(b)

If I missed it I'd be glad for you to show me where it says merchants cannot pass along surcharges for using a credit card.

It's not the merchant agreements but the change to federal law that is allowing the surcharges. Since it is federal law, state laws that prohibit surcharges are now invalid.

If you read throught the FCBA and information on the FTC site, this is very clear. If you have some other source of information that contradicts what the FTC and congress are saying, please post it so we can evaluate and discuss the specifics of your source of information.

Nowhere could I find an amendment to an existing Federal law or a new Federal law or even an FDIC or FTC regulation relating to changes in surcharges. If a law changed, Congress would have to pass a new law. Those are all published. The Federal government doesn't regulate them. Some states do.

If there was a federal law that prevented charging, as you say, it would take a new federal law to amend that or a Federal judge would have to find it in violation of the US Constitution. No new law and no court ruling to be found. Neither happened because it wasn't regulated.

This was a negotiated settlement between private parties that a judge approved after a couple of rounds of court ordered mediation. If there was a law that prevented them and a judge struck it down it would not be part of a negotiated settlement.

This is the website set up by the class administrators. This was entirely a negotiated settlement of an anti-trust lawsuit. Nowhere did Congress amend or pass a law relating to this or did Judge John Gleeson, of the Eastern District of the US District Court who presided over the case (docket MDL 1720) issue a ruling that found Visa and M/C practices of not allowing surcharges against Federal law or unconstitutional.

One of the co-lead counsels website. It links to the entire 357 page settlement. Everything was negotiated. If a judge found something that Visa and M/C did illegal it wouldn't need to be negotiated.

"Historically Visa has not permitted retailer surcharging, but allowing surcharging was a key provision required by merchants to settle long-standing litigation brought by a class of retailers in 2005." From Visa's own website regarding the settlement.

Scroll down to the middle of this http://online.wsj.com/article/BT-CO-...09-716671.html for comments from Judge Gleeson. Again, settlement, not Congressional law.

Jeremy

[woodturner]

only point out that if your state prevents surcharges then they will continue.

I was just pointing out that they will not continue and will be illegal under federal law.

If I missed it I'd be glad for you to show me where it says merchants cannot pass along surcharges for using a credit card.

That was explained in the first post: "The problem was that FCBA caps and limits finance charges, and a credit card surcharge is considered a finance charge. " There is a more thorough explaination on the FTC site.

If there was a federal law that prevented charging, as you say, it would take a new federal law to amend that

Yes, it's listed in the federal register.

This is the website set up by the class administrators. This was entirely a negotiated settlement of an anti-trust lawsuit.

I agree that is the lawsuit that prompted the change in federal law.

[conscience]

Where is it listed in the Federal Register? I could not find it.

[conscience]

Oops. I hit reply too soon.

Where in the FCBA does it state that a surcharge for credit card use is a finance charge? And where does it prohibit them? It was not in the section you linked to nor anywhere else I could find. The only thing I saw that it dealt with was cash discounts.

Section 171 does deal with finance charges, but is directed at card issuers and limited to changes to existing balances. A surcharge from a merchant on a purchase you are making is not an existing balance.

Show me where Federal law prohibits merchants from adding a surcharge to a purchase to either encourage payment in another form or to pass along the swipe fee to the customer. You still haven't done that. I'm not being a jerk, I'd genuinely like to know.