88R7089 SRA-F
By: Parker S.B. No. 1541
A BILL TO BE ENTITLED
AN ACT
relating to the charging of swipe fees on certain electronic
payment transactions; authorizing a civil penalty.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Title 12, Business & Commerce Code, is amended by
adding Chapter 610 to read as follows:
CHAPTER 610. CHARGING OF SWIPE FEES
Sec. 610.001. DEFINITIONS. In this chapter:
(1) "Assessment fee" means a fee, usually based on the
total amount of monthly sales, paid directly to the payment card
network for allowing a merchant to use a payment card or other
payment code or device in an electronic payment transaction.
(2) "Electronic payment transaction" means a
transaction in which a person uses a payment 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 a signature, personal identification
number, or other means.
(3) "Interchange fee" means a fee charged to a
merchant for the purpose of compensating the payment card issuer
for the issuer's involvement in an electronic payment transaction.
(4) "Payment card" means a credit card, debit card,
check card, or other card that is issued to an authorized user to
purchase or obtain goods, services, money, or any other thing of
value.
(5) "Payment card issuer" means a lender, including a
financial institution, or a merchant that receives applications and
issues payment cards to individuals.
(6) "Payment card network" means an entity that
directly, or through a licensed member, processor, or agent,
provides the proprietary services, infrastructure, and software
that route information and data to conduct debit card or credit card
transaction authorization, clearance, and settlement, and that an
entity 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.
(7) "State or local tax" includes a tax imposed by this
state or a unit of local government of this state, including the
sales, excise, and use tax, motor fuels tax, hotel occupancy tax,
and the tax imposed on the rental of a motor vehicle, other than a
tax returned to a taxpayer in the form of a deduction or discount
under Section 151.423 or 151.424, Tax Code.
(8) "Swipe fee" means the interchange fee and, if
applicable, the assessment fee.
Sec. 610.002. EXCLUSION OF STATE OR LOCAL TAXES FROM SWIPE
FEES; MERCHANT DEDUCTION OR REBATE. (a) The amount of state or
local tax that is calculated as a percentage of the amount of an
electronic payment transaction made in this state and listed
separately on a payment invoice or other demand for payment must be
excluded from the total amount on which a swipe fee is charged for
that transaction.
(b) A payment card network shall with respect to each form
or type of electronic payment transaction:
(1) deduct the amount of state or local tax imposed
from the calculation of swipe fees attributable to the transaction
at the time of settlement; or
(2) rebate the merchant an amount equal to the amount
of swipe fees attributable to the state or local tax imposed on the
transaction.
(c) A deduction or rebate under this section must occur at
the time of settlement when the merchant is able to capture and
transmit state or local tax or fee amounts relevant to the sale at
the time of sale as part of the transaction finalization. If a
merchant is unable to capture and transmit tax or fee amounts
relevant to the sale at the time of sale, then the payment card
network must accept proof of tax or fee amounts collected on sales
subject to a swipe fee on the submission of sales data by the
merchant.
Sec. 610.003. CIVIL PENALTY; RESTITUTION. (a) A person who
violates this chapter is liable to this state for a civil penalty in
an amount not to exceed $1,000 for each violation.
(b) The attorney general may bring an action to:
(1) recover the civil penalty imposed under this
section; or
(2) obtain a temporary or permanent injunction to
restrain the violation.
(c) An action under this section may be brought in a
district court in:
(1) Travis County; or
(2) a county in which any part of the violation occurs.
(d) The attorney general shall deposit a civil penalty
collected under this section in the state treasury to the credit of
the general revenue fund.
(e) A person who violates this chapter shall refund a
merchant any swipe fees charged in violation of this chapter.
SECTION 2. This Act takes effect September 1, 2023.