NY State Senate Bill 2021-S4035

Senate Bill S4035

2021-2022 Legislative Session

Relates to the establishment of notice requirements for credit card fees or surcharges; repealer

download bill text pdf

Archive: Last Bill Status - In Senate Committee Consumer Protection Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 05, 2022	referred to consumer protection
Feb 01, 2021	referred to consumer protection

2021-S4035 (ACTIVE) - Details

See Assembly Version of this Bill:: A314
Current Committee:: Senate Consumer Protection
Law Section:: General Business Law
Laws Affected:: Rpld & add §518, Gen Bus L
Versions Introduced in Other Legislative Sessions:: 2019-2020: S7265, A8707
2023-2024: S2459, A1370

2021-S4035 (ACTIVE) - Summary

Establishes notice requirements for fees or surcharges imposed by sellers when a credit card is used as payment for the sale of goods or services.

2021-S4035 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S4035

SPONSOR: COMRIE
 
TITLE OF BILL:

An act to amend the general business law, in relation to credit card
surcharge or fee notice requirements; and to repeal section 518 of such
law relating thereto

 
PURPOSE OR GENERAL IDEA OF BILL:

This bill would prohibit merchants from imposing a fee or surcharge for
use of a credit card as payment unless they adhere to certain require-
ments.

 
SUMMARY OF PROVISIONS:

Section one of the bill repeals section 518 of the general business law
by replacing it with a new section 518 as it relates to requiring
merchants to post two prices where prices are displayed, one that credit
card customers are charged and the other to customers using other
accepted payments. The merchant must also post notice of the imposition

of a surcharge at entry, and at the point of sale. The section requires
such notice for online and phone sales. The section places a cap on the
surcharge of 4% or the amount charged to the seller to process the cred-
it card; whichever is lower. The section prohibits the imposition of a
credit card surcharge on debit cards.

Section two of the bill relates to the effective date.

 
JUSTIFICATION:

Recently, a court ruling (Expressions Hair. Designs, Inc v.  Schneider-
man) struck down the prior New York law prohibiting credit card
surcharges. This bill will ensure there are proper notice requirements
and other restrictions to protect consumers from hidden fees.

This bill seeks to regulate the imposition of credit card surcharges to
ensure that consumers are not subject to hidden fees. By displaying two
prices, it clearly and unambiguously informs the customers the price
they will be charged based on. their form of payment. The notice
requirement will expose consumers to multiple opportunities to be made
aware that the merchant will impose a fee for using a credit card prior
to purchase. This will allow the consumer to make an informed decision
on whether to shop at an establishment that utilizes a credit card
surcharge. The bill also caps the surcharge to no more than the amount
the seller is charged to prevent any profiting off of a surcharge.

 
PRIOR LEGISLATIVE HISTORY:

New Bill.

 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:

None.

 
EFFECTIVE DATE:
This act shall take effect on the ninetieth day after it shall have
become law.

2021-S4035 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   4035
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                             February 1, 2021
                                ___________
 
 Introduced  by  Sen.  COMRIE -- read twice and ordered printed, and when
   printed to be committed to the Committee on Consumer Protection
 
 AN ACT to amend the general business law, in  relation  to  credit  card
   surcharge  or  fee  notice  requirements; and to repeal section 518 of
   such law relating thereto

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Section 518 of the general business law is REPEALED and a
 new section 518 is added to read as follows:
   § 518. CREDIT CARD SURCHARGE; NOTICE REQUIREMENTS.  NO  PERSON,  FIRM,
 PARTNERSHIP, ASSOCIATION OR CORPORATION WHO IS ENGAGED IN A SALES TRANS-
 ACTION MAY IMPOSE A SURCHARGE OR FEE FOR USE OF A CREDIT CARD AS PAYMENT
 FOR  THE  SALE OF GOODS OR SERVICES UNLESS SUCH SELLER COMPLIES WITH THE
 FOLLOWING REQUIREMENTS:
   1. DISPLAYED PRICES, INCLUDING  BUT  NOT  LIMITED  TO  ADVERTISEMENTS,
 SHALL INCLUDE TWO PRICES, ONE OF WHICH IS THE PRICE CHARGED TO CONSUMERS
 USING  A  CREDIT  CARD  AND  THE OTHER IS THE PRICE CHARGED TO CONSUMERS
 USING AN ACCEPTED FORM OF PAYMENT OTHER THAN A CREDIT CARD.
   2. A NOTICE SHALL BE  POSTED  THAT  EXPLAINS  THE  IMPOSITION  OF  THE
 SURCHARGE OR FEE, THE AMOUNT OF THE SURCHARGE AND WHICH CREDIT CARDS ARE
 SUBJECT TO THE SURCHARGE OR FEE. SUCH NOTICE SHALL BE LEGIBLE AND POSTED
 AT  THE  POINT  OF  ENTRY AND THE POINT OF SALE. IF THE SALE OF GOODS OR
 SERVICES IS PROCESSED THROUGH A  WEBSITE,  THE  SELLER  MUST  POST  SUCH
 NOTICE  ON  THE  HOME PAGE AND THE POINT OF SALE WEBPAGE. IF THE SALE OF
 GOODS OR SERVICES IS PROCESSED OVER THE PHONE, SUCH NOTICE INCLUDING ALL
 REQUIRED INFORMATION SHALL BE VERBALLY DISCLOSED TO  THE  CUSTOMER.  THE
 NOTICE  REQUIRED  BY THIS SECTION SHALL BE PROMINENTLY AND CONSPICUOUSLY
 POSTED AT THE REQUIRED LOCATIONS IN A MINIMUM SIZE SIXTEEN FONT.
   3. NO SURCHARGE OR FEE SHALL EXCEED FOUR PERCENT OF THE  TOTAL  TRANS-
 ACTION  OR  THE ACTUAL AMOUNT TO BE CHARGED TO THE SELLER TO PROCESS THE
 CREDIT CARD TRANSACTION, WHICHEVER IS LESS.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD04214-01-1

 S. 4035                             2
 
   4. NO SELLER SHALL IMPOSE A SURCHARGE OR FEE FOR THE USE  OF  A  DEBIT
 CARD.
   §  2.  This  act shall take effect on the ninetieth day after it shall
 have become a law.

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