Excessive Surcharge Provisions enforced by the ACCC

Earlier this week, the ACCC commenced its first proceedings under new provisions of the Competition and Consumer Act 2010 (Cth) that ban excessive payment surcharges.  This clearly signals that the ACCC is actively monitoring and enforcing these restrictions, and comes as a timely reminder for businesses to review their surcharges for accepting payment by credit, debit and prepaid cards to ensure compliance.

Under these provisions, merchants must not charge customers surcharges in excess of the cost to process a particular method of payment (the cost of acceptance), for example, bank transaction fees and terminal costs.  The ban applies to the payment types designated by the Reserve Bank of Australia and as at the date of this post, includes EFTPOS (debit and prepaid), MasterCard (credit, debit and prepaid), Visa (credit, debit and prepaid) and American Express cards issued by Australian financial service providers.  Notably, these restrictions do not apply to payments made for taxi services or payments made by BPAY, PayPal, Diners Club cards, American Express cards issued by a US financial institutions, cash and cheques.

For more information, including how to determine whether a surcharge is excessive, ACCC fact sheets can be accessed at this link.

This blog was co-authored by Valiant Warzecha, Jessie Buchan and Melinda Upton.