HOUSE BILL 476

57th legislature - STATE OF NEW MEXICO - first session, 2025

INTRODUCED BY

Anita Gonzales and Cristina Parajón and Art De La Cruz

 

 

 

 

 

AN ACT

RELATING TO TRADE PRACTICES; ENACTING THE PRICE FIXING PROHIBITION, CONSUMER TRANSPARENCY AND TAX FAIRNESS ACT; PROHIBITING NETWORK INTERCHANGE PRICE FIXING; PROHIBITING INTERCHANGE FEES ON TAXES AND GRATUITIES; CREATING PENALTIES.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     SECTION 1. A new section of Chapter 57 NMSA 1978 is enacted to read:

     "[NEW MATERIAL] SHORT TITLE.--This act may be cited as the "Price Fixing Prohibition, Consumer Transparency and Tax Fairness Act"."

     SECTION 2. A new section of Chapter 57 NMSA 1978 is enacted to read:

     "[NEW MATERIAL] DEFINITIONS.--As used in the Price Fixing Prohibition, Consumer Transparency and Tax Fairness Act:

          A. "acquirer bank" means a member of a payment card network that contracts with a merchant for the settlement of electronic payment transactions. An acquirer bank may contract directly with merchants or indirectly through a processor to process electronic payment transactions;

          B. "authorization" means the process through which a merchant requests approval for an electronic payment transaction from the issuer;

          C. "clearance" means the process of transmitting final transaction data from a merchant to an issuer for posting to a cardholder's account and the calculation of fees and charges, including interchange fees, that apply to the issuer and the merchant;

          D. "consumer" means a person who has been issued a credit card or debit card or who purchases goods or services using an electronic payment transaction or another method of payment;

          E. "covered credit card issuer" means a credit card issuer that, together with any affiliates, had consolidated worldwide banking and nonbanking assets, including assets of affiliates, other than trust assets under management, of more than eighty-five billion dollars ($85,000,000,000) at any point during the previous calendar year;

          F. "credit card" means a card, plate, coupon book or other credit device existing for the purpose of obtaining money, property, labor or services on credit;

          G. "debit card" means a card or other payment code or device issued or approved for use through a payment card network to debit an asset account, regardless of the purpose for which the account is established, whether authorization is based on a signature, a personal identification number or other means. "Debit card" includes general-use prepaid cards, but does not include paper checks;

          H. "electronic payment transaction" means a transaction in which a person uses a debit card, a credit 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, a personal identification number or other means;

          I. "fee schedule" means a schedule, list, table, chart or similar document or agreement, whether publicly disclosed or not, that sets forth or fixes the amount or the formula for determining the amount of one or more fee rates;

          J. "gratuity" means a voluntary monetary contribution to an employee from a guest, patron or customer in connection with services rendered;

          K. "interchange fee" means a fee established, charged or received by a payment card network for the purpose of compensating an issuer for the issuer's involvement in an electronic payment transaction;

          L. "issuer" means a person that issues a debit card or credit card or the issuer's agent;

          M. "merchant" means a person that accepts electronic payment transactions and collects and remits a tax;

          N. "payment card network" means an entity that:

                (1) directly or through licensed members, processors or agents provides the proprietary services, infrastructure and software to route information and data for the purpose of conducting electronic payment transaction authorization, clearance and settlement; and

                (2) a merchant uses to accept as a form of payment a brand of debit card, credit card or other device that may be used to carry out electronic payment transactions;

          O. "processor" means an entity that facilitates, services, processes or manages the debit or credit authorization, billing, transfer, payment procedures or settlement with respect to an electronic payment transaction;

          P. "settlement" means the process of transmitting sales information to an issuing bank for collection and reimbursement of funds to a merchant and calculating and reporting the net transaction amount to the issuer and the merchant for an electronic payment transaction that is cleared;

          Q. "tax" means the gross receipts tax and a local option gross receipts tax imposed by a municipality or county; and

          R. "tax documentation" means documentation sufficient for a payment card network to determine the total amount of an electronic payment transaction and the tax or gratuity amount of the transaction. Tax documentation may be related to a single electronic payment transaction or multiple electronic payment transactions aggregated over a period of time. Tax documentation may include invoices, receipts, journals, ledgers and tax returns filed with the taxation and revenue department or local taxing authorities."

     SECTION 3. A new section of Chapter 57 NMSA 1978 is enacted to read:

     "[NEW MATERIAL] PROHIBITION ON NETWORK INTERCHANGE PRICE FIXING--OTHER UNFAIR CREDIT CARD PRACTICES.--

          A. It is unlawful for a payment card network to directly, or indirectly through an agent, a processor, a contract, a requirement, a condition, a penalty, a technological specification, an inducement or otherwise:

                (1) fix or conspire to fix an interchange fee with, or on behalf of, another covered credit card issuer or payment card network;

                (2) require a person to accept as payment a credit card issued by a covered credit card issuer if the person accepts as payment other credit cards that are enabled for processing over the payment card network;

                (3) charge a consumer or a merchant a fee or assessment due to a disputed credit card transaction unless a finding of fact concludes that the consumer or merchant is responsible for the disputed transaction and the consumer or merchant is provided written notification of the finding of fact; or

                (4) impose a penalty on a merchant based upon the way the merchant lawfully sets prices for goods or services.

          B. It is unlawful for a covered credit card issuer to directly, or indirectly through an agent, processor, contract, requirement, condition, penalty, inducement, technological specification or otherwise:

                (1) fix or conspire to fix an interchange fee with or on behalf of another covered credit card issuer or payment card network;

                (2) receive or charge an interchange fee for a credit card transaction in an amount that is included on or determined by a fee schedule that:

                     (a) has been fixed, established or put forward by a payment card network; or

                     (b) the covered credit card issuer knows or reasonably should know is being used in the same calendar year by another covered card issuer to determine the amount of an interchange fee with respect to a credit card transaction that the other covered credit card issuer receives or charges;

                (3) on or after one hundred eighty days after the effective date of the Price Fixing Prohibition, Consumer Transparency and Tax Fairness Act, issue a monthly statement to a consumer who has been issued a credit card by the covered credit card issuer without disclosing in a clear and conspicuous manner for each credit card transaction listed in the monthly statement:

                     (a) whether interchange fees were charged on the credit card transaction; and

                     (b) the amount charged for each interchange fee charged on each credit card transaction;

                (4) charge a consumer or a merchant a fee or assessment due to a disputed credit card transaction unless a finding of fact concludes that the consumer or merchant is responsible for the disputed transaction and the consumer or merchant is provided written notification of the finding of fact; or

                (5) prohibit or penalize a merchant based upon the way the merchant lawfully sets prices for goods or services."

     SECTION 4. A new section of Chapter 57 NMSA 1978 is enacted to read:

     "[NEW MATERIAL] INTERCHANGE FEES ON TAXES AND GRATUITIES PROHIBITED.--

          A. An issuer, payment card network, acquirer bank or processor shall not receive or charge a merchant an interchange fee on the tax amount or gratuity of an electronic payment transaction if the merchant informs the acquirer bank or its designee of the tax or gratuity amount as part of the authorization or settlement process for the electronic payment transaction. A merchant shall transmit the tax or gratuity amount data as part of the authorization or settlement process to avoid being charged interchange fees on the tax or gratuity amount of an electronic payment transaction.

          B. A merchant that does not transmit the tax or gratuity amount data in accordance with this section may submit documentation for the electronic payment transaction to the acquirer bank or its designee no later than one hundred eighty days after the date of the electronic payment transaction and, within thirty days after the merchant submits the necessary documentation, the issuer shall credit to the merchant the amount of interchange fees charged on the tax or gratuity amount of the electronic payment transaction.

          C. Nothing in this section creates liability for a payment card network regarding the accuracy of the tax or gratuity data reported by the merchant.

          D. It is unlawful for an issuer, payment card network, acquirer bank or processor to alter or manipulate the computation and imposition of interchange fees by increasing the rate or amount of the fees applicable to or imposed on the portion of a credit or debit card transaction not attributable to taxes or gratuities in order to circumvent the effect of this section."

     SECTION 5. A new section of Chapter 57 NMSA 1978 is enacted to read:

     "[NEW MATERIAL] PENALTIES.--

          A. The attorney general may file suit to seek injunctive relief and, if appropriate, collect a civil penalty from a covered credit card issuer or payment card network that the attorney general believes has violated any of the prohibitions in Sections 3 and 4 of the Price Fixing Prohibition, Consumer Transparency and Tax Fairness Act.

          B. An issuer, payment card network, acquirer bank, processor or other designated entity that has received tax or gratuity amount data from a merchant and violates Section 4 of the Price Fixing Prohibition, Consumer Transparency and Tax Fairness Act is subject to a civil penalty of one thousand dollars ($1,000) per electronic payment transaction conducted in violation of the Price Fixing Prohibition, Consumer Transparency and Tax Fairness Act, and the issuer shall refund to the merchant the interchange fee calculated on the tax or gratuity amount relative to the electronic payment transaction.

          C. A person, other than a merchant, involved in facilitating or processing an electronic payment transaction, including an issuer, payment card network, an acquirer bank, processor or other designated entity, shall not distribute, exchange, transfer, disseminate or use the electronic payment transaction data except to facilitate or process the electronic payment transaction; to monitor for, detect or prevent fraud; to support loyalty, rewards or promotional offerings; to tailor products and services to serve customer needs; or as required by law. A violation of this subsection constitutes a violation of the Unfair Practices Act."

     SECTION 6. SEVERABILITY.--If a part or application of the Price Fixing Prohibition, Consumer Transparency and Tax Fairness Act is held invalid, the remainder or its application to other situations or persons shall not be affected.

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