interchange fees; payment card transactions

HB2768 - 572R - I Ver

REFERENCE TITLE:
interchange fees; payment card transactions

State of Arizona

House of Representatives

Fifty-seventh Legislature

Second Regular Session

2026

HB 2768

Introduced by

Representative
Powell

AN
ACT

amending title 44, chapter 38, Arizona
Revised Statutes, by adding article 2; relating to electronic payment
transactions.

(TEXT OF BILL BEGINS ON NEXT PAGE)

Be it enacted by the Legislature of the State of Arizona:

Section 1.
Heading change

The chapter heading of title 44,
chapter 38, Arizona Revised Statutes, is changed from "BUSINESSES EXEMPT
FROM MASK MANDATE" to "BUSINESSES GENERALLY".

Sec. 2. Title 44, chapter 38, Arizona Revised
Statutes, is amended by adding article 2, to read:

ARTICLE 2. ELECTRONIC PAYMENT
TRANSACTIONS

AND INTERCHANGE FEES

START_STATUTE
44-7961.

Definitions

In this article, unless the context otherwise
requires:

1. "Acquirer bank" means a
financial institution that contracts with a merchant, either directly or
indirectly through a processor, for the settlement of electronic payment
transactions.

2. "Authorization" means
the process through which a merchant requests approval for an electronic
payment transaction from the issuer.

3. "Chargeback" means the
transfer of monies from an electronic payment transaction after settlement from
a merchant's acquirer bank to an issuer because of a dispute over the
electronic payment transaction.

4. "Chargeback dispute"
means a process for resolving a dispute that has been raised about the validity
of an electronic payment transaction and that seeks a chargeback of monies.

5. "Charitable
contribution" means a charitable contribution as defined in 26 united
states code section 170(
c
).

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

7. "Covered issuer" means
an issuer that held consolidated worldwide banking and nonbanking assets,
including assets of affiliates, other than trust assets under management of
more than $50,000,000,000 during any point in the previous calendar year.

8. "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.

9. "Debit card":

(
a
) Means a
card or other payment code or device that is 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.

(
b
) Includes a
general-use prepaid card as defined in 15 united states code section
16931-1.

(
c
) Does not
include paper checks.

10. "Electronic payment
transaction" means a transaction in which a person uses a debit card,
credit card or other payment code or device that is 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.

11. "Fee schedule" means
any schedule, list, table, chart, agreement, communication or other document,
whether publicly available or not, that sets forth an amount or formula for
determining one or more fees.

12. "Interchange fee" means
a fee that is established, charged or received by a payment card network for
the purpose of compensating the issuer for its involvement in an electronic
payment transaction.

13. "Issuer" means a
person, or the person's agent, that issues a debit card or credit card.

14. "Merchant" means a
person that accepts electronic payment transactions and collects and remits a
tax.

15. "Payment card network"
means an entity that both:

(
a
) Directly,
or through a licensed member, processor or agent, provides the proprietary
services, infrastructure and software to route information and data for the
purpose of conducting electronic payment transaction authorization, clearance
and settlement.

(
b
) Is used by
a merchant to accept as a form of payment a brand of debit card or credit card
or another device that may be used to carry out electronic payment
transactions.

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

17. "Settlement" means the
process of transmitting sales information to the issuer for collection and
reimbursement of monies to the merchant and calculating and reporting the net
transaction amount to the issuer and merchant for an electronic payment
transaction that is cleared.

18. "Tax" means any
transaction privilege tax, use and occupation tax or excise tax imposed by this
state or any unit of local government in this state.
END_STATUTE

START_STATUTE
44-7962.

Interchange fees; prohibition; rates

A payment card network, whether directly or
through an agent, acquirer bank, processor, contract, requirement, condition,
penalty, technological specification or inducement, may not:

1. Establish, charge or put forward
on a fee schedule an interchange fee that the payment card network knows or
reasonably should know has been used by a covered issuer if both:

(
a
) The fee is
or includes a percentage multiplied by the gross dollar amount of a transaction
that is conducted with a debit card or credit card.

(
b
) The fee
does not exclude from the gross dollar amount of the transaction any amount
attributable to a tax.

2. Increase the rate or amount of an
interchange fee or other fee that applies to the portion of an electronic
payment transaction other than the portion attributable to a tax on the
transaction in an attempt to or in a manner that would circumvent the
prohibition prescribed in paragraph 1 of this section.
END_STATUTE

START_STATUTE
44-7963.

Payment card networks; fees; changes; disclosure; violation;
unlawful practice

A. A payment card network that
establishes or implements a fee schedule that the payment card network knows,
or reasonably should know, has been used by one or more issuers, other than the
payment card network, to determine the amount of an interchange fee charged or
received by the issuer on an electronic payment transaction in the current or
previous calendar year shall disclose to the attorney general and to the public
all the following:

1. Any change or addition to a fee
rate, formula or category on the fee schedule at least ninety days before the
change or addition takes effect in this state.

2. A list identifying each issuer
that used the payment card network's fee schedule in the previous calendar year
to determine the amount of an interchange fee charged or received by that
issuer on a electronic payment transaction conducted by a merchant that is
located in this state. The disclosure described in this paragraph
shall be made annually.

3. At least ninety days before any
change, addition, new fee or changed fee application takes effect in this
state, the change in a or a new or additional fee, fee rate, fee formula, fee
category or fee application that the payment card network establishes, charges
or receives.� This paragraph applies to any fee other than an interchange fee
that is established, charged or received by the payment card network on an
electronic payment transaction.�

B. A violation of this section is an
unlawful practice pursuant to section 44-1522.
END_STATUTE

START_STATUTE
44-7964.

Merchant pricing; penalties prohibited

A payment card network, whether directly or
through an agent, acquirer bank, processor, contract, requirement, condition,
penalty, technological specification or inducement, may not impose a penalty on
a merchant for setting prices in a manner that complies with state and federal
law.
END_STATUTE

START_STATUTE
44-7965.

Chargebacks; disclosure; prohibitions; annual statement

A. Before
a chargeback that relates to an electronic payment transaction involving a card
associated with a payment card network may occur, the payment card network
shall make available to the public all payment card network rules, processes, dispute
resolution procedures, fees and contractual provisions regarding the handling
of chargebacks and chargeback disputes involving cards associated with the
payment card network.

B. A payment card network, whether
directly or through an agent, acquirer bank, processor, contract, requirement,
condition, penalty, technological specification or inducement, may not allow
any chargeback to be finalized by an issuer of that payment card network until
both:

1. the chargeback dispute is resolved
by a determination made by an identified individual that the consumer or
merchant is liable for the electronic payment transaction.

2. the consumer or merchant receives
written notice of the determination.

C. A payment card network, whether
directly or through an agent, acquirer bank, processor, contract, requirement,
condition, penalty, technological specification or inducement, may not charge,
impose or assess a fee to a consumer or merchant if the fee is related to the
resolution of a chargeback dispute over an electronic payment transaction if
any of the following applies:

1. If the payment card network does
not provide a published general notice of the assessment of the fee in advance
of the chargeback dispute.

2. If the chargeback dispute has not
been resolved by a determination made by an identified individual that the
consumer or merchant is liable for the electronic payment transaction and the
consumer or merchant has not received written notice of the determination.

3. later than sixty days after
settlement of the electronic payment transaction that is the subject of the
chargeback dispute, unless the payment card network identifies extraordinary
circumstances and notifies in writing the merchant and consumer that are
involved in the chargeback dispute about the extraordinary circumstances.

d. A payment card network shall
annually provide each merchant and each consumer involved in one or more
chargeback disputes involving cards associated with the payment card network
with a statement in a paper or an electronic format identifying all chargeback
disputes involving the merchant or consumer that occurred during the previous
year and any chargebacks that were finalized for that merchant or consumer
during that year.
END_STATUTE

START_STATUTE
44-7966.

Fee schedules; limits; charitable contributions

A payment card
network, whether directly or through an agent, acquirer bank, processor,
contract, requirement, condition, penalty, technological specification or
inducement, may not establish or implement a fee schedule that the payment card
network knows or reasonably should know has been used by one or more issuers
other than the payment card network to determine the amount of an interchange
fee charged or received with respect to a charitable contribution, unless the
interchange fee does not exceed either:

1. Two-tenths of one percent of the
amount of a charitable contribution made by means of a debit card.

2. Three-tenths of one percent of the
amount of a charitable contribution made by means of a credit card.
END_STATUTE

START_STATUTE
44-7967.

Violation; civil penalties; attorney general action; exception

A. A payment card network that violates
this Article Is subject to a civil penalty of not more than $1,000 per
electronic payment transaction that is related to the violation.

B. The attorney general may file an
action against a payment card network that violates this article and may seek
injunctive relief, a civil penalty and restitution.

c. this section does not apply to
section 44-7963.
END_STATUTE

Sec. 3.
Effective date

This act is effective from and after
December 31, 2026.