2021 -- S 0925

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LC002894

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2021

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A N   A C T

RELATED TO COMMERCIAL LAW -- GENERAL REGULATORY PROVISIONS

     Introduced By: Senator Maryellen Goodwin

     Date Introduced: May 20, 2021

     Referred To: Senate Commerce

     It is enacted by the General Assembly as follows:

     SECTION 1. Title 6 of the General Laws entitled "COMMERCIAL LAW - GENERAL

REGULATORY PROVISIONS" is hereby amended by adding thereto the following chapter:

CHAPTER 26.2

SURCHARGES ON CREDIT CARD TRANSACTIONS

     6-26.2-1. Legislative intent.

     It is the intent of the general assembly to promote the effective operation of the free market

and protect consumers from deceptive price increases for goods and services by prohibiting credit

card surcharges and encouraging the availability of discounts by those retailers who wish to offer

a lower price for goods and services purchased by some form of payment other than credit card.

     6-26.2-2. Definitions.

     As used in this chapter:

     (1) "Consumer" means the person named on the face of a credit card to whom or for whose

benefit the credit card is issued by an issuer and shall include any employee or other agent or

authorized user of the card;

     (2) "Credit card" means any instrument or device, whether known as a credit card, credit

plate, or by any other name, issued with or without fee by an issuer for the use of the cardholder in

obtaining money, goods, services, or anything else of value on credit;

     (3) "Person" means an individual or corporation, partnership, trust, association, joint

venture pool, syndicate, sole proprietorship, unincorporated organization, or any other legal entity;

and

     (4) "Retailer" means a person who furnishes money, goods, services, or anything else of

value upon presentation, whether physically, in writing, verbally, electronically or otherwise, of a

credit card by the cardholder, or any agent or employee of such person.

     6-26.2-3. Surcharges on credit card transactions prohibited.

     (a) No person or retailer in any sales, service, or lease transaction with a consumer may

impose a surcharge on a consumer who elects to use a credit card as payment unless such person

or retailer complies with the following requirements:

     (1) Displayed prices, including, but not limited to, advertisements, shall display the total

price charged to consumers using a credit card, or if the person or retailer elects, two (2) 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, the amount of

the surcharge and which credit cards are subject to the surcharge. Such notice shall be clearly and

conspicuously posted at the point of entry and the point of sale. If the sale of goods, services or

lease transaction is processed through a website, the person or retailer must post such notice on the

home page and the point of sale webpage. If the sale of goods, services, or lease transaction 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 (16) font.

     (3) No surcharge shall exceed one percent (1%) of the total transaction.

     (4) No surcharge shall be charged for the use of a debit card as payment.

     (b) A person or retailer may offer discounts for the purpose of inducing payment by cash,

check, or other means not involving the use of a credit card; provided that, the discount is offered

to all prospective buyers and its availability is disclosed to all prospective buyers clearly and

conspicuously.

     (c) A consumer shall not be deemed to have elected to use a credit card in lieu of another

means of payment for purposes of this section in a transaction with a person or retailer if only credit

cards are accepted by that person or retailer in payment for an order made by a consumer over a

telephone, and only cash is accepted at a public store or other facility of the same person or retailer.

     (d) Charges for third-party credit card guarantee services, when added to the price charged

by the person or retailer if cash were to be paid, shall be deemed surcharges for purposes of this

section even if they are payable directly to the third party or are charged separately.

     6-26.2-4. Penalties.

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     Any person or retailer who violates the provision of this chapter shall be guilty of a

misdemeanor punishable by a fine not to exceed five hundred dollars ($500) or a term of

imprisonment up to one year, or both. Moreover, a violation of this section shall be deemed an

unfair or deceptive trade practice under chapter 13.1 of title 6.

     6-26.2-5. Exemptions.

     Nothing in this chapter shall prohibit any person or retailer from conditioning acceptance

of a credit card on a consumer's minimum purchase. Each person or retailer shall disclose any such

minimum purchase policy orally or in writing at the point of purchase. For the purposes of this

section "at the point of purchase" includes, but is not limited to, at or on a cash register, in an

advertisement or menu.

     SECTION 2. This act shall take effect upon passage.

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LC002894

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATED TO COMMERCIAL LAW -- GENERAL REGULATORY PROVISIONS

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     This act would regulate the imposition of surcharges on any consumer when using a credit

card to make a purchase or other business transaction.

     This act would take effect upon passage.

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LC002894

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