HR 5546 IHRHCommentsClose CommentsPermalink

To amend the antitrust laws to ensure competitive market-based rates and terms for merchants'’ access to electronic payment systems.CommentsClose CommentsPermalink

March 6, 2008CommentsClose CommentsPermalink

Mr. CONYERS (for himself, Mr. CANNON, Ms. ZOE LOFGREN of California, Mr. SHUSTER, Mr. WEINER, Mr. DELAHUNT, Mr. PLATTS, Mr. WELCH of Vermont, Mr. SULLIVAN, Mr. WILSON of South Carolina, Mr. GOHMERT, Mr. HALL of Texas, Mr. BOOZMAN, and Mr. PETERSON of Pennsylvania) introduced the following bill; which was referred to the Committee on the JudiciaryCommentsClose CommentsPermalink

To amend the antitrust laws to ensure competitive market-based rates and terms for merchants'’ access to electronic payment systems.CommentsClose CommentsPermalink

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, CommentsClose CommentsPermalink

SECTION 1. SHORT TITLE.

This Act may be cited as the `‘Credit Card Fair Fee Act of 2008'’. CommentsClose CommentsPermalink

SEC. 2. LIMITED ANTITRUST IMMUNITY FOR THE NEGOTIATION AND DETERMINATION OF RATES AND TERMS FOR ACCESS TO COVERED ELECTRONIC PAYMENT SYSTEMS.

(a) Definitions- For purposes of this Act: CommentsClose CommentsPermalink





(1) `Access agreement'‘Access agreement’ means an agreement giving a merchant permission to access a covered electronic payment system to accept credit cards and/or debit cards from consumers for payment for goods and services as well as to receive payment for such goods and services, conditioned solely upon the merchant complying with the rates and terms specified in the agreement. CommentsClose CommentsPermalink





(2) `Acquirer'‘Acquirer’ means a financial institution that provides services allowing merchants to access an electronic payment system to accept credit cards and/or debit cards for payment, but does not include independent third party processors that may act as the acquirer'’s agent in processing general-purpose credit or debit card transactions. CommentsClose CommentsPermalink





(3) `Antitrust Division'‘Antitrust Division’ means the Antitrust Division of the U.S. Department of Justice. CommentsClose CommentsPermalink





(4) `Antitrust Laws'‘Antitrust laws’ has the meaning given it in subsection (a) of the first section of the Clayton Act (15 U.S.C. 12(a)), except that such term includes section 5 of the Federal Trade Commission Act (15 U.S.C. 45) to the extent such section 5 applies to unfair methods of competition as well as any similar State law. CommentsClose CommentsPermalink





(5) `Base year' means the most recent full calendar year prior to the initiation of a proceeding under this Act.(6) `Commission' means the Federal Trade Commission Bureau of Competition.(7) `Credit card'‘Credit card’ means any general-purpose card or other device issued or approved for use by a financial institution allowing the cardholder to obtain goods or services on credit on terms specified by that financial institution. CommentsClose CommentsPermalink





(8) `Covered electronic payment system'6) ‘Covered electronic payment system’ means an electronic payment system that has been used for at least 20% percent of the combined dollar value of U.S. credit card, signature-based debit card, and PIN-based debit card payments processed in the applicable base year.(9) `Debit card'calendar year immediately preceding the year in which the conduct in question occurs. CommentsClose CommentsPermalink





(7) ‘Debit card’ means any general-purpose card or other device issued or approved for use by a financial institution for use in debiting a cardholder'’s account for the purpose of that cardholder obtaining goods or services, whether authorization is signature-based or PIN-based. CommentsClose CommentsPermalink





(10) `Electronic payment system'8) ‘Electronic payment system’ means the proprietary services and infrastructure that route information and data to facilitate transaction authorization, clearance, and settlement that merchants must access in order to accept a specific brand of general-purpose credit cards and/or debit cards as payment for goods and services. CommentsClose CommentsPermalink





(11) `Financial institution'9) ‘Financial institution’ has the same meaning as in section 603(t) of the Fair Credit Reporting Act. CommentsClose CommentsPermalink





(12) `Issuer'0) ‘Issuer’ means a financial institution that issues credit cards and/or debit cards or approves the use of other devices for use in an electronic payment system, but does not include independent third party processors that may act as the issuer'’s agent in processing general-purpose credit card or debit card transactions;(13) `Market power'. CommentsClose CommentsPermalink





(11) ‘Market power’ means the ability profitably to raise prices above those that would be charged in a perfectly competitive market. CommentsClose CommentsPermalink





(14) `Merchant'2) ‘Merchant’ means any person who accepts credit cards and/or debit cards in payment for goods or services that they provide. CommentsClose CommentsPermalink





(15) `Normal rate of return' means the average rate of return that a firm would receive in an industry when conditions of perfect competition prevail.(16) `Party' means either all providers of a single covered electronic payment system collectively or all merchants collectively.(17) `Person'3) ‘Negotiating party’ means 1 or more providers of a covered electronic payment system or 1 or more merchants who have access to or who are seeking access to that covered electronic payment system, as the case may be, and who are in the process of negotiating or who have executed a voluntarily negotiated access agreement that is still in effect. CommentsClose CommentsPermalink





(14) ‘Person’ has the meaning given it in subsection (a) of the first section of the Clayton Act (15 U.S.C. 12(a)). CommentsClose CommentsPermalink





(18) `Provider'5) ‘Provider’ means any person who owns, operates, controls, serves as an issuer for, or serves as an acquirer for a covered electronic payment system. CommentsClose CommentsPermalink





(19) `State'6) ‘State’ has the meaning given it in section 4G(2) of the Clayton Act (15 U.S.C. 15g(2)). CommentsClose CommentsPermalink





(20) `Terms'17) ‘Terms’ means all rules applicable either to providers of a single covered electronic payment system or to merchants, and that are required in order to provide or access that covered electronic payment system for processing credit card and/or debit card transactions. CommentsClose CommentsPermalink





(21) `Voluntarily negotiated access agreement'18) ‘Voluntarily negotiated access agreement’ means an executed agreement voluntarily negotiated between 1 or more providers of a single covered electronic payment system and 1 or more merchants that sets the rates and terms pursuant to which the 1 or more merchants can access that covered electronic payment system to accept credit cards and/or debit cards from consumers for payment of goods and services, and receive payment for such goods and services. CommentsClose CommentsPermalink





(b) Access to Covered Electronic Payment Systems- Access to any covered electronic payment system by merchants shall be subject to this Act.(c) Authority and Limited Antitrust Immunity for Negotiations and Participation in Proceedings- N of Access Rates and Terms to Covered Electronic Payment Systems- (1) Except as provided in paragraph (2) and notwithstanding any provision of the antitrust laws, in negotiating access rates and terms and participating in any proceedings in accordance with subsection (d), any providers of a single covered electronic payment system and any merchants may jointly negotiate and agree upon the rates and terms for access to the covered electronic payment system, including through the use of common agents that represent either providers of a single covered electronic payment system or merchants on a non-exclusive basis. Any providers of a single covered electronic payment system also may jointly determine the proportionate division among themselves of paid access fees. CommentsClose CommentsPermalink





(d) Determination of Access Rates and Terms-(1) PROCEEDINGS- Proceedings under this Act shall determine rates and terms for access to a covered electronic payment system during the 3-year period beginning on January 1 of the second year following the year in which the proceedings are to be commenced, except where a different transitional period is provided under section 6. Except as specified in a voluntarily negotiated access agreement, no other fees, terms, or conditions of any kind may be imposed directly or indirectly on any merchant for accessing a covered electronic payment system. The parties to each proceeding shall bear their own costs.(2) DETERMINATIONS OF THE ELECTRONIC PAYMENT SYSTEM JUDGES-(A) APPLICABILITY- The schedule of rates and terms determined by the Electronic Payment System Judges with respect to a single covered electronic payment system shall, subject to paragraph (4), be binding on all providers of that single covered electronic payment system and merchants affected by thisNotwithstanding any other provision of this Act, the immunity otherwise applicable under paragraph during the 3-year period specified in subparagraph (1).(1) shall not apply to a provider of a single covered electronic payment system, or to a merchant, during any period in which such provider, or such merchant, is engaged in any unlawful boycott. CommentsClose CommentsPermalink





(c) Nondiscrimination- For any given covered electronic payment system, such rates and termsthe rates and terms of a voluntarily negotiated access agreement reached under the authority of this section shall be the same for all merchants, regardless of merchant category or volume of transactions (either in number or dollar value) generated. (B) STANDARD FOR DETERMINATIONS- In establishing rates and terms for access to a covered electronic payment system by merchants, the Electronic Payment System Judges shall establish rates and terms that most closely represent the rates and terms that would be negotiated in a hypothetical perfectly competitive marketplace for access to an electronic payment system between a willing buyer with no market power and a willing seller with no market power. In determining such rates and terms, the Electronic Payment System Judges shall consider the costs necessary to provide and access an electronic payment system for processing credit and/or debit card transactions as well as a normal rate of return in such a hypothetical perfectly competitive marketplace. The Electronic Payment System Judges shall not include any anticompetitive rates or terms.(C) USE OF EXISTING RATES AND TERMS AS EVIDENCE- In determining such rates and terms, the Electronic Payment System Judges generally shall decide the appropriate weight to be given to any evidence submitted by a party regarding the rates and terms for access to comparable electronic payment systems, including rates and terms set forth in voluntarily negotiated access agreements filed pursuant to subparagraph (4). The Electronic Payment System Judges shall give significant weight, however, to rates voluntarily negotiated between one or more providers of a single covered electronic payments system and one or more merchants that are substantially below those rates reflective of the market power of covered electronicFor any given covered electronic payment systems that existed prior to the enactment of this Act.(3) INITIATION- The procedures under subparagraphs (1) and (2) shall be initiated pursuant to section 5.(4) VOLUNTARILY NEGOTIATED ACCESS AGREEMENTS-(A) AGREEMENTS BETWEEN THE PARTIES- Voluntarily negotiated access agreements may be executed at any time between 1 or more providers of a single covered electronic payment system and 1 or more merchants, and such voluntarily negotiated access agreements shall be given effect with respect to those parties in lieu of any determination by the Electronic Payment System Judges.(B) FILING AGREEMENTS WITH THE ELECTRONIC PAYMENT SYSTEM JUDGES- Any providers of a single covered electronic payment system and merchants affected by this section must jointly file with the Electronic Payment System Judges any voluntarily negotiated access agreements that affect any domestic or international market, including related documentation evidencing any consideration being given, any marketing or promotional agreements between the parties, and any subsequent amendments to such agreements and documentation.(C) TIMING OF AND ACCESS TO FILINGS- The parties to any voluntarily negotiated access , the rates and terms of a voluntarily negotiated access agreement executed subsequent to the enactment of the Credit Card Fair Fee Act of 2008 must jointly file such agreement, amendment, or documentation with the Electronic Payment System Judges within 30 days of executing the agreement, amendment, or documentation. The Electronic Payment System Judges shall make publicly available all such agreements, amendments, and related documentation executed subsequent to the date of enactment of this Act.SEC. 3. ELECTRONIC PAYMENT SYSTEM JUDGES.(a) Appointment- The Antitrust Division and Commission shall appoint 3 full-time Electronic Payment System Judges, and shall appoint 1 of the 3 as the Chief Electronic Payment System Judge.(b) Functions- Subject to the provisions of this Act, the function of the Electronic Payment System Judges shall be to make determinations of access rates and terms calculated to most closely represent the rates and terms that would be negotiated in a hypothetical perfectly competitive marketplace for access to an electronic payment system between a willing buyer with no market power and a willing seller with no market power. In determining such rates and terms, the Electronic Payment System Judges shall consider the costs necessary to provide and access an electronic payment system for processing credit and/or debit card transactions as well as a normal rate of return in such a hypothetical perfectly competitive marketplace.(c) Rulings- The Electronic Payment System Judges may make any necessary procedural or evidentiary rulings in any proceeding under this Act and may, before commencing a proceeding under this Act, make any procedural rulings that would apply to the proceedings conducted by the Electronic Payment System Judgesreached under the authority of this section shall be the same for all participating providers, regardless of provider category or volume of transactions (either in number or dollar value) generated. CommentsClose CommentsPermalink





(d) Administrative Support- The Antitrust Division and Commission shall provide the Electronic Payment System Judges with the necessary administrative services related to proceedings under this Act.(e) Location- The offices of the Electronic Payment System Judges and staff shall be in the Antitrust Division or Commission.(f) Qualifications of Electronic Payment System Judges-(1) IN GENERAL- Each Electronic Payment System Judge shall be an attorney who has at least 7 years of legal experience. The Chief Electronic Payment System Judge shall have at least 5 years of experience in adjudications, arbitrations, or court trials. Of the other 2 Electronic Payment System Judges, 1 shall have significant knowledge of electronic payment systems, and the other shall have significant knowledge of economics. An individual may serve as an Electronic Payment System Judge only if the individual is free of any financial conflict of interest under subsection (m).(2) DEFINITION- In this subsection, the term `adjudication' has the meaning given that term in section 551 of title 5, but does not include mediation.(g) Staff- The Chief Electronic Payment System Judge shall hire 3 full-time staff members to assist the Electronic Payment System Judges in performing their functions.(h) Terms- The individual first appointed as the Chief Electronic Payment System Judge shall be appointed to a term of 6 years, and of the remaining individuals first appointed as Electronic Payment System Judges, 1 shall be appointed to a term of 4 years, and the other shall be appointed to a term of 2 years. Thereafter, the terms of succeeding Electronic Payment System Judges shall each be 6 years. An individual serving as an Electronic Payment System Judge may be reappointed to subsequent terms. The term of an Electronic Payment System Judge shall begin when the term of the predecessor of that Electronic Payment System Judge ends. When the term of office of an Electronic Payment System Judge ends, the individual serving that term may continue to serve until a successor is installed.(i) Vacancies or Incapacity-(1) VACANCIES- If a vacancy should occur in the position of Electronic Payment System Judge, the Antitrust Division and Commission shall act expeditiously to fill the vacancy, and may appoint an interim Electronic Payment System Judge to serve until another Electronic Payment System Judge is appointed under this section. An individual appointed to fill the vacancy occurring before the expiration of the term for which the predecessor of that individual was appointed shall be appointed for the remainder of that term.(2) INCAPACITY- In the case in which an Electronic Payment System Judge is temporarily unable to perform his or her duties, the Antitrust Division and Commission may appoint an interim Electronic Payment System Judge to perform such duties during the period of such incapacity.(j) Compensation-(1) JUDGES- The Chief Electronic Payment System Judge shall receive compensation at the rate of basic pay payable for level AL-1 for administrative law judges pursuant to section 5372(b) of title 5, and each of the other two Electronic Payment System Judges shall receive compensation at the rate of basic pay payable for level AL-2 for administrative law judges pursuant to such section. The compensation of the Electronic Payment System Judges shall not be subject to any regulations adopted by the Office of Personnel Management pursuant to its authority under section 5376(b)(1) of title 5.(2) STAFF MEMBERS- Of the staff members appointed under subsection (g)--(A) the rate of pay of 1 staff member shall be not more than the basic rate of pay payable for level 10 of GS-15 of the General Schedule;(B) the rate of pay of 1 staff member shall be not less than the basic rate of pay payable for GS-13 of the General Schedule and not more than the basic rate of pay payable for level 10 of GS-14 of such Schedule; and(C) the rate of pay for the third staff member shall be not less than the basic rate of pay payable for GS-8 of the General Schedule and not more than the basic rate of pay payable for level 10 of GS-11 of such Schedule.(3) LOCALITY PAY- All rates of pay referred to under this subsection shall include locality pay.(k) Independence of Electronic Payment System Judge-(1) IN MAKING DETERMINATIONS-(A) IN GENERAL- The Electronic Payment System Judges shall have full independence in making determinations concerning adjustments and determinations of rates and terms for access to covered electronic payment systems and in issuing other rulings under this title, except that the Electronic Payment System Judges may consult with the Antitrust Division and Commission on any matter other than a question of fact.(B) CONSULTATION- Notwithstanding the provisions of subparagraph (A), the Electronic Payment System Judges shall consult with the Antitrust Division and Commission with respect to any determination or ruling that would require that any act be performed by the Antitrust Division and Commission, and any such determination or ruling shall not be binding upon the Antitrust Division or Commission.(2) PERFORMANCE APPRAISALS-(A) IN GENERAL- Notwithstanding any other provision of law or any regulation of the Antitrust Division and Commission, and subject to subparagraph (B), the Electronic Payment System Judges shall not receive performance appraisals.(B) RELATING TO SANCTION OR REMOVAL- To the extent that the Antitrust Division and Commission adopt regulations under subsection (m) relating to the sanction or removal of an Electronic Payment System Judge and such regulations require documentation to establish the cause of such sanction or removal, the Electronic Payment System Judge may receive an appraisal related specifically to the cause of the sanction or removal.(l) Inconsistent Duties Barred- No Electronic Payment System Judge may undertake duties that conflict with his or her duties and responsibilities as an Electronic Payment System Judge.(m) Standards of Conduct- The Antitrust Division and Commission shall adopt regulations regarding the standards of conduct, including financial conflict of interest and restrictions against ex parte communications, which shall govern the Electronic Payment System Judges and the proceedings under this Act.(n) Removal or Sanction- The Antitrust Division and Commission may sanction or remove an Electronic Payment System Judge for violation of the standards of conduct adopted under subsection (m), misconduct, neglect of duty, or any disqualifying physical or mental disability. Any such sanction or removal may be made only after notice and opportunity for a hearing, but the Antitrust Division and Commission may suspend the Electronic Payment System Judge during the pendency of such hearing. The Antitrust Division and Commission shall appoint an interim Electronic Payment System Judge during the period of any such suspension.SEC. 4. PROCEEDINGS OF ELECTRONIC PAYMENT SYSTEM JUDGES.(a) Proceedings-(1) IN GENERAL- The Electronic Payment System Judges shall act in accordance with regulations issued by the Electronic Payment System Judges and the Antitrust Division and Commission, and on the basis of a written record, prior determinations and interpretations of the Electronic Payment System Judges under this Act, and decisions of the court of appeals under this section.(2) JUDGES ACTING AS PANEL AND INDIVIDUALLY- The Electronic Payment System Judges shall preside over hearings in proceedings under this Act en banc. The Chief Electronic Payment System Judge may designate an Electronic Payment System Judge to preside individually over such collateral and administrative proceedings, and over such proceedings under paragraphs (1) and (2) of subsection (b), as the Chief Judge considers appropriate.(3) DETERMINATION LIMITED TO CHOOSING ONE OF THE TWO FINAL OFFERS- Prior to the commencement of a direct hearing in a proceeding under section 5(b)(3)(B)(xi), the party entitled to receive access fee payments shall file with the Electronic Payment System Judges its final offer of rates and terms. Simultaneously, the party obligated to pay access fee payments shall file with the Electronic Payment System Judges its final offer of rates and terms. The parties also shall exchange these final offers, which cannot be amended. In making a determination under section 5(c), the Electronic Payment System Judges shall be limited to choosing, without modification, one of these two final offers.(4) VOTING AND DISSENTING OPINIONS- Final determinations of the Electronic Payment System Judges in proceedings under this Act shall be made by majority vote. An Electronic Payment System Judge dissenting from the majority on any determination under this Act may issue his or her dissenting opinion, which shall be included with the determination.(b) ProceduresFacilitation of Negotiation- CommentsClose CommentsPermalink





(1) INITIATION- The Electronic Payment System Judges shall cause to be published in the Federal Register notice of commencement of proceedings referred to in section 3 as provided under section 6.(2) VOLUNTARY NEGOTIATION PERIOD-(A) IN GENERAL- Promptly after the commencement of a proceeding, the Electronic Payment System Judges shall initiate a voluntary negotiation period among the parties.(B) LENGTH- The voluntary negotiation period initiated under subparagraph (A) shall be 3 months. Nothing in this subsection, however, prohibits parties from negotiating and entering into voluntarily negotiated access agreements at any other time.(C) DETERMINATION OF NEED FOR SUBSEQUENT PROCEEDINGS- At the close of the voluntary negotiation proceedings, the Electronic Payment System Judges shall determine if further proceedings under this Act are necessary. In any such proceeding, all providers of the covered electronic payment system shall participate as a single party and all merchants shall participate as a single party, except to the extent certain providers or merchants pursue voluntarily negotiated access agreements.(3) REGULATIONS-(A) IN GENERAL- The Electronic Payment System Judges may issue regulations to carry out their functions under this title. All regulations issued by the Electronic Payment System Judges are subject to the approval of the Antitrust Division and Commission. Not later than 120 days after Electronic Payment System Judges are first appointed after the enactment of the Credit Card Fair Fee Act of 2008, such judges shall issue regulations to govern proceedings under this Act. In setting these regulations, the Electronic Payment System Judges shall consider the regulations issued by the Copyright Royalty Judges pursuant to 17 U.S.C. 803(b)(6).(B) REQUIREMENTS- Regulations issued under subparagraph (A) shall include the following:(i) WRITTEN DIRECT STATEMENTS- The written direct statements of the parties to a proceeding shall be filed by a date specified by the Electronic Payment System Judges, which may be not earlier than 4 months, and not later than 5 months, after the end of the voluntary negotiation period under paragraph (3). Notwithstanding the preceding sentence, the Electronic Payment System Judges may allow a party in a proceeding to file an amended written direct statement based on new information received during the discovery process, within 15 days after the end of the discovery period specified in clause (ii). InSCHEDULE- Within one month following enactment of this Act, the term `written direct statements' means witness statements, testimony, and exhibits to be presented in the proceedings, and such other information that is necessary to establish access terms and rates as set forth in regulations issued by the Electronic Payment System Judges.(ii) DISCOVERY SCHEDULE- Following the submission to the Electronic Payment System Judges of written direct statements by the parties to a proceeding, the judges shall meet with the parties for the purpose of settingnegotiating parties shall file with the Antitrust Division a schedule for conducting and completing discovery. Such schedule shall be determined by the Electronic Payment System Judges. Discovery in such proceedings shall be permitted for a period of 60 days, except for discovery ordered by the Electronic Payment System Judges in connection with the resolution of motions, orders, and disputes pending at the end of such period.(iiinegotiations. If the negotiating parties do not file such a schedule within one month from the date of enactment, the Antitrust Division shall issue such a schedule and inform the negotiating parties of the schedule. In either case, the Antitrust Division shall make the schedule available to all negotiating parties. CommentsClose CommentsPermalink





(2) INITIAL DISCLOSURES- In a proceeding under this Act to determine rates and terms for access to a single covered electronic payment system, certain- Within one month following enactment of this Act, the persons must makdescribed in this subsection shall make the initial disclosures within 30 days of commencement of the proceeding. Tdescribed in paragraphs (3), (4), and (5) to facilitate negotiations under the limited antitrust immunity provided for by this section. CommentsClose CommentsPermalink





(3) ISSUERS, ACQUIRERS, AND OWNERS- Any person who is 1 of the 10 largest issuers for the covered electronic payment system,a covered electronic payment system in terms of number of cards issued, any person who is 1 of the 10 largest acquirers for the covered electronic payment systema covered electronic payment system in terms of number of merchants served, and any person operating or controlling the covered electronic payment system must produce to merchants bothwho operates or controls a covered electronic payment system shall produce to the Antitrust Division and to all negotiating parties-- CommentsClose CommentsPermalink





(A) an itemized list of the costs necessary to provide that electronic payment system for processing credit and/or debit card transactionse covered electronic payment system that were incurred by the person during the most recent full calendar year prior to the initiation of the proceeding and any agreements regarding rates and terms for access to the covered electronic payment system. Tbefore the initiation of the negotiation; and CommentsClose CommentsPermalink





(B) any access agreement between that person and 1 or more merchants with regard to that covered electronic payment system. CommentsClose CommentsPermalink





(4) MERCHANTS- Any person who is 1 of the 10 largest merchants in terms of utilization of the covered electronic payment system must produce to the providers of the covered electronic payment system bothusing the covered electronic payment system, determined based on dollar amount of transactions made with the covered electronic payment system, shall produce to the Antitrust Division and to all negotiating parties-- CommentsClose CommentsPermalink





(A) an itemized list of the costs necessary to access an electronic payment system for processing credit and/or debit card transactions during the most recent full calendar year prior to the initiation of the proceeding and any agreements regarding rates and terms for access to the covered electronic payment system.; and CommentsClose CommentsPermalink





(B) any access agreement between that person and 1 or more providers with regard to that covered electronic payment system. CommentsClose CommentsPermalink





(5) DISAGREEMENT- Any disagreement between the providers of a single covered electronic payment system and the merchants regarding which persons areregarding whether a person is required to make suchan initial disclosures shall be resolved by the Electronic Payment System Judges.(iv) DEPOSITIONS-(I) In a proceeding under this Act to determine access rates and terms, each party shall be permitted to take depositions of every witness identified by the other party. Each party also shall be permitted to take five additional depositions in the entire proceeding.(II) A deposition notice or subpoena may name as the deponent a public or private corporation or a partnership or association and describe with reasonable particularity the matters on which examination is requested. In that event, the organization so named shall designate one or more officers, directors, or managing agents, or other persons who consent to testify on its behalf, and may set forth, for each person designated, the matters on which the person will testify. under this clause, or the contents of such a disclosure, shall be resolved by the Antitrust Division. CommentsClose CommentsPermalink





(6) ATTENDANCE OF ANTITRUST DIVISION- A subpoena shall advise a non-party organization of its duty to make such a designation. The persons so designated shall testify as to matters known or reasonably available to the organization.(III) The Electronic Payment System Judges may increase the permitted number of depositions for good cause in exceptional circumstances, and shall resolve any disputes among persons within either party regarding the allocation of the depositions permitted under this clause.(v) WRITTEN DISCOVERY- In a proceeding under this Act to determine access rates and terms, each party shall be permitted to serve written discovery requests on 10 persons. These written discovery requests may include requests for production or inspection, a total of no more than 10 requests for admission in the entire proceeding, and a total of no more than 25 interrogatories in the entire proceeding. The Electronic Payment System Judges may increase the permitted number of requests for admission or interrogatories for good cause in exceptional circumstances, and shall resolve any disputes among persons within either party regarding the allocation of the requests for admission or interrogatories permitted under this clause.(vi) SUBPOENAS- Upon the request of a party to a proceeding to determine access rates and terms, the Electronic Payment System Judges may issue a subpoena commanding a person to appear and give testimony, or to produce and permit inspection of documents or tangible things, if the Electronic Payment System Judges' resolution of the proceeding may be substantially impaired by the absence of such testimony or production of documents or tangible things. Such subpoena shall specify with reasonable particularity the materials to be produced or the scope and nature of the required testimony. Nothing in this clause shall preclude the Electronic Payment System Judges from requesting the production by a person of information or materials relevant to the resolution by the Electronic Payment System Judges of a material issue of fact.(vii) OBJECTIONS TO DISCOVERY REQUESTS- Any objection to such a request or subpoena shall be resolved by a motion or request to compel production made to the Electronic Payment System Judges in accordance with regulations adopted by the Electronic Payment System Judges. Each motion or request to compel discovery shall be determined by the Electronic Payment System Judges, or by an Electronic Payment System Judge when permitted under subsection (a)(2). Upon such motion, the Electronic Payment System Judges may order discovery pursuant to regulations established under this paragraph. In determining whether discovery will be granted under this clause, the Electronic Payment System Judges may consider--(I) whether the burden or expense of producing the requested information or materials outweighs the likely benefit, taking into account the needs and resources of the parties, the importance of the issues at stake, and the probative value of the requested information or materials in resolving such issues;(II) whether the requested information or materials would be unreasonably cumulative or duplicative, or are obtainable from another source that is more convenient, less burdensome, or less expensive; and(III) whether the party seeking discovery has had ample opportunity by discovery in the proceeding or by other means to obtain the information sought.(viiirepresentative of the Antitrust Division shall attend all negotiation sessions conducted under the authority of this section. CommentsClose CommentsPermalink





(e) Transparency of Voluntarily Negotiated Access Agreements- CommentsClose CommentsPermalink





(1) VOLUNTARILY NEGOTIATED ACCESS AGREEMENTS- In proceedings to determine access rates and terms, the Electronic Payment System Judges shall make available to the parties all documents filed pursuant to section 3(d)(4), including related BETWEEN NEGOTIATING PARTIES- A voluntarily negotiated access agreement may be executed at any time between 1 or more providers of a covered electronic payment system and 1 or more merchants. CommentsClose CommentsPermalink





(2) FILING AGREEMENTS WITH THE ANTITRUST DIVISION- The negotiating parties shall jointly file with the Antitrust Division a clear intelligible copy of-- CommentsClose CommentsPermalink





(A) any voluntarily negotiated access agreement that affects any market in the United States or elsewhere; CommentsClose CommentsPermalink





(B) the various components of the interchange fee; CommentsClose CommentsPermalink





(C) a description of how access fees that merchants pay are allocated among financial institutions and how they are spent; CommentsClose CommentsPermalink





(D) whether a variation in fees exists among card types; CommentsClose CommentsPermalink





(E) any documentation relating to a voluntarily negotiated access agreement evidencing any consideration being given, or any marketing or promotional agreements between the parties, and subsequent amendments to such agreements andnegotiating parties; CommentsClose CommentsPermalink





(F) a comparison of interchange rates in current use in the 10 foreign countries having the highest volume of credit card transactions with the interchange rates charged in the United States under such agreement; and CommentsClose CommentsPermalink





(G) any amendments to that voluntarily negotiated access agreement or documentation. CommentsClose CommentsPermalink





(ix) SETTLEMENT CONFERENCE- The Electronic Payment System Judges shall order a settlement conference between the parties in the proceeding to facilitate the presentation of offers of settlement between the parties. The settlement conference shall be held during a 21-day period following the end of the discovery period and shall take place outside the presence of the Electronic Payment System Judges.(x) DIRECT3) TIMING AND REBUTTAL HEARINGS- At the conclusion of the 21-day period following the end of the discovery period, the Electronic Payment System Judges shall determine if further proceedings under this Act are necessary. If so, the Electronic Payment System Judges shall schedule a direct hearing of not moreAVAILABILITY OF FILINGS- The negotiating parties to any voluntarily negotiated access agreement executed after the date of enactment of this Act shall jointly file the voluntarily negotiated access agreement, and any documentation or amendments described in paragraph (2), with the Antitrust Division not later than 30 court days and a rebuttal hearing of not more than 20 court days during which both parties will be allowed to put on witnesses.(xi) SPONSORING WITNESSES- No evidence, including exhibits, may be submitted in the written direct statement or written rebuttal statement of a party without a sponsoring witness, except for requests for admission that have been admitted by the receiving party, where the Electronic Payment System Judges have taken official notice, in the case of incorporation by reference of past records, or for good cause shown.(xii) HEARSAY- Hearsay may be admitted in proceedings under this Act to the extent deemed relevant and reliable by the Electronic Payment System Judges.(xiii) APPLICABILITY OF THE FEDERAL RULES OF EVIDENCE- To the extent not inconsistent with this subparagraph, the Federal Rules of Evidence shall apply to proceedings under this Act.(4) PENALTIES FOR FAILURE TO COMPLY WITH A DISCOVERY REQUEST-(A) FAILURE TO COMPLY- Any person fails to comply with a discovery request if they, their employee, or agent fails, without substantial justification, to:(i)after the date of execution of the voluntarily negotiated access agreement or amendment or after the creation of the documentation. The Antitrust Division shall make initial disclosures required under section 3(b)(3)(B);(ii) be sworn or to answer a question as a deponent after being directed to do so by the Electronic Payment System Judges;(iii) answer an interrogatory submitted pursuant to section 3(b)(3)(B);(iv) produce non-privileged documents requested pursuant to section 3(b)(3)(B); or(v) admit the genuineness of any document or the truth of any matter as requested under section 3(b)(3)(B), and the person requesting the admissions thereafter proves the genuineness of the document or the truth of the matter.For purposes of this Act, any disclosure, answer, or response that is false or substantially misleading, evasive, or incomplete is to be treated as a failure to disclose, answer, or respond.(B) NEGATIVE INFERENCE IN CURRENT PROCEEDING- If any person fails to comply with a discovery request, the Electronic Payment System Judges may issue an order that the matters regarding which the order was made or any other designated facts shall be taken to be established for the purposes of the current proceeding in accordance with the claim of the person seeking discovery and obtaining the order.(C) CIVIL PENALTY-(i) GENERALLY- Any person who fails to comply with a discovery request shall be subject to a civil penalty, which shall be assessed by the Electronic Payment System Judges, of not more than $25,000 for each violation. Each day of violation shall constitute a separate violation.(ii) NOTICE AND HEARINGS- No civil penalty may be assessed under this subsection except pursuant to an order of the Electronic Payment System Judges and unless the person accused of the violation was given prior notice and opportunity to request and participate in a hearing before the Electronic Payment System Judges with respect to the violation.(iii) DETERMINING AMOUNT- In determining the amount of any penalty assessed pursuant to this subsection, the Electronic Payment System Judges shall take into account the nature, circumstances, extent, and gravity of the violation or violations and, with respect to the violator, ability to pay, any prior history of such violations, the degree of culpability, economic benefit or savings (if any) resulting from the violation, and such other matters as justice may require.(iv) REVIEW- Any person who requested a hearing with respect to a civil penalty under this subsection and who is aggrieved by an order assessing the civil penalty may file a petition for judicial review of such order with the United States Court of Appeals for the District of Columbia Circuit. Such a petition may bepublicly available any voluntarily negotiated access agreement, amendment, or accompanying documentation filed only within the 30-day period beginning on the date the order making such assessment was issued. The court shall have jurisdiction to enter a judgment affirming, modifying, or setting aside in whole or in part, the order of the Electronic Payment System Judges, or the court may remand the proceeding to the Electronic Payment System Judges for such further action as the court may direct. The Antitrust Division shall represent the Electronic Payment System Judges before the court.(v) ENFORCEMENT- If any person fails to pay an assessment of a civil penalty after it has become a final and unappealable order or after the appropriate court has entered final judgment, the Electronic Payment System Judges shall request the Antitrust Division to institute a civil action in an appropriate district court of the United States to collect the penalty, and such court shall have jurisdiction to hear and decide any such action. In hearing such action, the court shall have authority to review the violation and the assessment of the civil penalty on the record.(c) Determination of Electronic Payment System Judges-(1) TIMING- The Electronic Payment System Judges shall issue their determination in a proceeding the earlier of either (i) 11 months after the conclusion of the 21-day settlement conference period under subsection (b)(3)(B)(ix) or (ii) 15 days before the expiration of the then current statutory rates and terms.(2) REHEARINGS-(A) IN GENERAL- The Electronic Payment System Judges may, in exceptional cases, upon motion of a party in a proceedingunder this Act, order a rehearing, after the determination in the proceeding is issued under paragraph (1), on such matters as the Electronic Payment System Judges determine to be appropriate.(B) TIMING FOR FILING MOTION- Any motion for a rehearing under subparagraph (A) may be filed only within 15 days after the date on which the Electronic Payment System Judges deliver to the parties in the proceeding their initial determination concerning rates and terms.(C) PARTICIPATION BY OPPOSING PARTY NOT REQUIRED- In any case in which a rehearing is ordered, any opposing party shall not be required to participate in the rehearing, except that nonparticipation may give rise to the limitations with respect to judicial review provided for in subsection (d)(1).(D) NO NEGATIVE INFERENCE- No negative inference shall be drawn from lack of participation in a rehearing.(E) CONTINUITY OF RATES AND TERMS-(i) If the decision of the Electronic Payment System Judges on any motion for a rehearing is not rendered before the expiration of the statutory rates and terms that were previously in effect, in the case of a proceeding to determine successors to rates and terms that expire on a specified date, then the initial determination of the Electronic Payment System Judges that is the subject of the rehearing motion shall be effective as of the day following the date on which the rates and terms that were previously in effect expire.(ii) The pendency of a motion for a rehearing under this paragraph shall not relieve persons obligated to make access fee payments who would be affected by the determination on that motion from paying the access fees required and complying with the terms under the relevant determination or regulations.(iii) Notwithstanding clause (ii), whenever access fees described in clause (ii) are paid, the recipient of those payments shall, within 60 days after the motion for rehearing is resolved or, if the motion is granted, within 60 days after the rehearing is concluded, return any excess amounts previously paid to the extent necessary to comply with the final determination of access rates and terms by the Electronic Payment System Judges. Any underpayment of access fees resulting from a rehearing shall be paid within the same period.(3) CONTENTS OF DETERMINATION- A determination of the Electronic Payment System Judges shall include the rates and terms for access to the relevant covered electronic payment system, shall be supported by the written record, and shall set forth the findings of fact relied on by the Electronic Payment System Judges. The Electronic Payment System Judges shall make publicly available in their entirety all determinations issued pursuant to this paragraph. CommentsClose CommentsPermalink





(4) CONTINUING JURISDICTION- The Electronic Payment System Judges may, with the approval of the Antitrust Division and Commission, issue an amendment to a written determination to correct any technical or clerical errors in the determination in response to unforeseen circumstances that would frustrate the proper implementation of such determination. Such amendment shall be set forth in a written addendum to the determination that shall be distributed to the parties to the proceeding and shall be published in the Federal Register.(5) PROTECTIVE ORDER- The Electronic Payment System Judges may issue such orders as may be appropriate to protect confidential information, including orders excluding confidential information from the record of the determination that is published or made available to the public, except that any terms or rates of an access agreement, including those set forth in filings under section 3(d)(4), may not be excluded.(6) PUBLICATION OF DETERMINATIONf) Report to Congress by the Antitrust Division- Within 60 days of the Electronic Payment System Judges issuing a determination pursuant to this subsection, the Antitrust Division and Commission shall cause the determination, and any corrections thereto, to be published in the Federal Register. The Electronic Payment System Judges also shall publicize the determination and corrections in such other manner as the Antitrust Division and Commission consider appropriate, including, but not limited to, publication on the Internet. The Electronic Payment System Judges also shall make the determination, corrections, and the accompanying record available for public inspection and copying.(7) LATE PAYMENT- A determination of Electronic Payment System Judges may include terms with respect to late payment, but in no way shall such terms prevent providers of a single covered electronic payment system from asserting other rights or remedies provided under this title.(d) Judicial Review-(1) APPEAL- Any determination of the Electronic Payment System Judges under subsection (c) may, within 30 days after the publication of the determination in the Federal Register, be appealed, to the United States Court of Appeals for the District of Columbia Circuit, by any aggrieved party to the proceeding under this Act who would be bound by the determination. Any party that did not participate in a rehearing may not raise any issue that was the subject of that rehearing at any stage of judicial review of the hearing determination. If no appeal is brought within that 30-day period, the determination of the Electronic Payment System Judges shall be final, and shall take effect as set forth in paragraph (2).(2) EFFECT OF RATES AND TERMS-(A) The pendency of an appeal under this subsection shall not relieve persons obligated to make access fee payments who would be affected by the determination on appeal from paying the access fees required and complying with the termsseven months after the date of enactment of this Act, the Antitrust Division shall transmit to the House Committee on the Judiciary and the Senate Committee on the Judiciary a report on the negotiations conducted under the relevant determination or regulations.(B) Notwithstanding subparagraph (A), whenever access fees described in subparagraph (A) are paid, the recipient of such payments shall, within 60 days after the final resolution of the appeal, return any excess amounts previously paid (and interest thereon, if ordered pursuant to paragraph (3)) to the extent necessary to comply with the final determination of access rates and terms on appeal. Any underpayment of access fees resulting from an appeal (and interest thereon, if ordered pursuant to paragraph (3)) shall be paid within the same period.(3) JURISDICTION OF COURT- If the court, pursuant to section 706 of title 5, modifies or vacates a determination of the Electronic Payment System Judges, the court may enter its own determination with respect to the amount or distribution of access fees and costs, and order the repayment of any excess fees, the payment of any underpaid fees, and the payment of interest pertaining respectively thereto, in accordance with its final judgment. The court also may vacate the determination of the Electronic Payment System Judges and remand the case to the Electronic Payment System Judges for further proceedings.(e) Administrative Matters-(1) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be appropriated such sums as may be necessary to pay the costs incurred under this Act. All funds made available pursuant to this subparagraph shall remain available until expended.(2) POSITIONS REQUIRED FOR ADMINISTRATION- Section 307 of the Legislative Branch Appropriations Act, 1994, shall not apply to employee positions in the Antitrust Division and Commission that are required to be filled in order to carry out section 3.SEC. 5. INSTITUTION OF PROCEEDINGS BEFORE ELECTRONIC PAYMENT SYSTEM JUDGES.(a) Initial Proceedings-(1) TIMING- Proceedings referred to in section 3(d)(1) shall be commenced as soon as practicable after the effective date of the Credit Card Fair Fee Act of 2008 to determine access terms and rates under section 3 for access to covered electronic payment systems, to be effective for the period beginning on January 1, 2010, and ending on December 31, 2011. The Electronic Payment System Judges shall cause notice of commencement of such proceedings to be published in the Federal Register.(2) PROCEDURES SPECIFIC TO THE INITIAL PROCEEDINGS-(A) DISCOVERY PERIOD- Notwithstanding section 5(b)(4)(B)(iv), discovery in the initial proceedings addressed in this subsection shall be permitted for a period of 90 days, except for discovery ordered by the Electronic Payment System Judges in connection with the resolution of motions, orders, and disputes pending at the end of such period.(B) CONSIDERATION OF CHANGES IN RATES AND TERMS BETWEEN DATE OF ENACTMENT AND INITIAL DETERMINATION- In determining the access rates and terms under section 3 for access to covered electronic payment systems, to be effective for the period beginning on January 1, 2010 and ending on December 31, 2011, the Electronic Payment System Judges shall consider changes in rates and terms made by a covered electronic payments system betweenauthority of this section during the first six months after the date of enactment of this Act and such initial determination. Based upon such consideration, the Electronic Payment System Judges may adjust their determination of the rates and terms for this initial proceeding to reflect the economic impact such changes had on the parties.(b) Subsequent Proceedings- Subsequent to the proceedings addressed in subsection (a), proceedings referred to in section 3(d)(1) shall next be commenced in 2010 to determine access rates and terms to become effective on January 1, 2012. Thereafter, such proceedings shall be repeated in each subsequent third calendar year. The Electronic Payment System Judges shall cause notice of commencement of proceedings referred to in section 3(d)(1) to be published in the Federal Registerand, if a voluntarily negotiated agreement is reached, whether such access rates and terms will have an adverse effect on competition and how such rates compare with access rates and terms in current use in other countries. Such report shall contain a chronology of the negotiations, an assessment of whether the parties have negotiated in good faith, an assessment of the quality of the data provided by the parties in their initial disclosures, a description of any voluntarily negotiated agreements reached during the negotiations, and any recommendations of the Antitrust Division concerning how Congress should respond to the conduct of the negotiations. CommentsClose CommentsPermalink





(g) Effect on Pending Lawsuits- Nothing in this section shall affect liability in any action pending on the date of enactment of this section. CommentsClose CommentsPermalink

SEC. 6. GENERAL RULE FOR VOLUNTARILY NEGOTIATED ACCESS AGREEMENTS.Any access rates or terms3. OPT-OUT.

Nothing in this Act shall limit the ability of acquirers or issuers that are regulated by the National Credit Union Administration or that, together with affiliates, have assets of less than $1,000,000,000, to opt out of negotiations under this titlAct. CommentsClose CommentsPermalink

Any agreements reached pursuant to the authority provided in section 2 shall provide that-- CommentsClose CommentsPermalink





(1) when any fees that a merchant is charged for access to a covered electronic payment system are agreed to pursuant to a voluntarily negotiated access agreement for a period shorter than would otherwise apply under a determination pursuant to this Actreduced pursuant to any such agreement, the merchant shall pass the benefits of any such reduction in fees on to its customers or employees; and CommentsClose CommentsPermalink





(2) when any fees that a financial institution collects for access to a covered electronic payment system are then adopted by the Electronic Payment System Judges as part of a determination under this Actshall remain in effect for such period of time as would otherwise apply under such determination, except that the Electronic Payment System Judges shall adjust those rates to reflect national monetary inflation during the additional period the rates remain in effect beyond that contemplated in the voluntarily negotiated access agreementincreased pursuant to any such agreement, the financial institution shall pass the benefits of any such increase in fees on to its customers or employees. CommentsClose CommentsPermalink

SEC. 75. EFFECTIVE DATE.

The effective date of this Act shall be the date of enactment.is Act shall take effect on the date of the enactment of this Act. CommentsClose CommentsPermalink