New rules for card payment surcharges by large merchants commenced on 1 September 2016.
Merchants will retain the right to impose a cost-based surcharge on card payments, but any surcharge will be limited to the amount it costs the merchant to accept that type of card for that transaction. Under the amendments to the Competition and Consumer Act 2010, the new standard will ensure that consumers using payment cards from designated systems (eftpos, the debit and credit systems of MasterCard and Visa, and the American Express companion card system) cannot be surcharged in excess of a merchant’s cost of acceptance for that card system.
Large merchants are defined as those that meet at least two of the following tests: consolidated turnover (including that of any related companies) of more than $25 million in the most recent financial year; consolidated gross assets at 30 June 2015 of $12.5 million or more; or 50 or more employees as at 30 June 2015.
All other merchants must comply from September 1, 2017.
Surcharging in the taxi industry will remain the responsibility of state regulators. Taxi surcharges are expected to be limited to 5%.
The rules will not affect ‘booking’ or ‘service’ fees, which are unrelated to payment costs and apply regardless of the method of payment.
