The Competition and Consumer Amendment (Payment Surcharges) Bill 2015 has been introduced into the House of Representatives.

The Bill will amend the Competition and Consumer Act 2010 by inserting a new Part IVC into the Act to establish a legislative and regulatory framework to ban excessive surcharges. The ban will apply to surcharges which are for a kind of payment covered by a Reserve Bank standard or regulations made for the purposes of the ban and which exceed the permitted amount.

For example, in the case of merchants a surcharge where the additional cost passed on is above the merchant’s cost of acceptance of the payment method will be
banned.

Under the Competition and Consumer Act 2010 as it currently stands, there is no specific prohibition against excessive surcharging.

The legislation will give the Australian Competition and Consumer Commission (ACCC) new powers to enforce the ban on surcharging, including the ability to gather information from those involved in the payments process and the authority to issue infringement notices against those engaging in excessive surcharging.

If the ACCC forms the view that a merchant has engaged in excessive surcharging, it may issue an infringement notice including a penalty for listed corporations of up to 600 penalty units, currently $108,000, for each alleged contravention.

The ban is scheduled to take effect from mid-2016.