I 

111TH CONGRESS 

2D SESSION H. R. 5199 

To authorize the Board of Governors of the Federal Reserve System to 

promulgate regulations regarding interchange transaction fees and to 

amend the Truth in Lending Act to prohibit certain restrictions put 

in place by credit card networks. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 4, 2010 

Mr. WELCH introduced the following bill; which was referred to the Committee 

on Financial Services 

A BILL 

To authorize the Board of Governors of the Federal Reserve 

System to promulgate regulations regarding interchange 

transaction fees and to amend the Truth in Lending 

Act to prohibit certain restrictions put in place by credit 

card networks. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Electronic Check Par5 ity Act of 2010’’. 


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1 SEC. 2. REGULATORY AUTHORITY OF THE BOARD OF GOV2 ERNORS OF THE FEDERAL RESERVE SYSTEM 

3 FOR ELECTRONIC DEBIT TRANSACTIONS. 

4 (a) FINDING.—The Congress finds that electronic 

5 debit transactions serve as a functional replacement for 

6 check transactions. 

7 (b) RULEMAKING.— 

8 (1) IN GENERAL.—The Board shall have au9 thority to promulgate rules regarding any inter10 change transaction fee that is charged with respect 

11 to an electronic debit transaction. 

12 (2) CONSIDERATIONS.—Rules promulgated by 

13 the Board pursuant to paragraph (1) shall be based 

14 on— 

15 (A) historic policies implemented by the 

16 Board that have ensured that checks clear at 

17 par; and 

18 (B) the Congressional finding under sub19 section (a) that electronic debit transactions 

20 serve as a functional replacement for check 

21 transactions. 

22 (c) EXEMPTIONS.—The Board may exempt financial 

23 institutions, including those regulated by the National 

24 Credit Union Administration, that, together with affili25 ates, have assets of less than $1,000,000,000 from the 


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1 rules promulgated by the Board pursuant to subsection 

2 (b). 

3 (d) DEFINITIONS.—For purposes of this section: 

4 (1) BOARD.—The term ‘‘Board’’ means the 

5 Board of Governors of the Federal Reserve System. 

6 (2) ELECTRONIC DEBIT TRANSACTION.—The 

7 term ‘‘electronic debit transaction’’ means a trans8 action in which a person uses a debit card or other 

9 device that has been approved for use in a payment 

10 card network to debit an account for the purpose of 

11 transferring money between accounts or obtaining 

12 goods or services. 

13 (3) INTERCHANGE TRANSACTION FEE.—The 

14 term ‘‘interchange transaction fee’’ means any fee 

15 established, charged, or received by an issuer or a 

16 payment card network on a per-transaction basis 

17 that has been established for the purpose of compen18 sating the issuer or payment card network for its 

19 role in authorizing, clearing, settling, or otherwise 

20 processing an electronic debit transaction. 

21 (4) ISSUER.—The term ‘‘issuer’’ means a finan22 cial institution that issues cards or other devices 

23 that have been approved for use in a payment card 

24 network. 


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1 (5) PAYMENT CARD NETWORK.—The term 

2 ‘‘payment card network’’ means an entity that di3 rectly, or through licensed members, processors, or 

4 agents, provides the proprietary services, infrastruc5 ture and software that route information and data 

6 to conduct transaction authorization, clearance and 

7 settlement, and that a person is required to access 

8 in order to accept a specific brand of credit card, 

9 debit card, prepaid card or similar device as a form 

10 of payment. 

11 SEC. 3. LIMITATION ON CREDIT CARD NETWORK RESTRIC12 TIONS. 

13 (a) IN GENERAL.—Chapter 2 of the Truth in Lend14 ing Act (15 U.S.C. 1631 et seq.) is amended by adding 

15 at the end the following new section: 

16 ‘‘§ 140B. Limitation on credit card network restric17 tions. 

18 ‘‘(a) IN GENERAL.—A credit card network may not, 

19 directly or through any agent, processor, or licensed mem20 ber of the network, by contract or otherwise, inhibit the 

21 ability of any person— 

22 ‘‘(1) to set a minimum or maximum dollar 

23 value for such person’s acceptance of any form of 

24 payment; or 


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1 ‘‘(2) to offer a discount, benefit, or anything 

2 else of value to customers in order to create an in3 centive for customers to pay such person using a 

4 form of payment that carries lower transaction fees 

5 or costs for such person. 

6 ‘‘(b) CREDIT CARD NETWORK DEFINED.—For pur7 poses of this section, the term ‘credit card network’ means 

8 an entity that directly, or through licensed members, proc9 essors, or agents, provides the proprietary services, infra10 structure, and software that route information and data 

11 to facilitate transaction authorization, clearance, and set12 tlement that a person must access in order to accept a 

13 specific brand of general-purpose credit card as payment 

14 for goods or services.’’. 

15 (b) CLERICAL AMENDMENT.—The table of sections 

16 for chapter 2 of the Truth in Lending Act is amended 

17 by inserting after the item relating to section 140A the 

18 following new item: 

‘‘140B. Limitation on credit card network restrictions’’. 

Æ 


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