Short title

This Act may be cited as the

Electronic Check Parity Act of 2010

Regulatory authority of the Board of Governors of the Federal Reserve System for electronic debit transactions

(a)

Finding

The Congress finds that electronic debit transactions serve as a functional replacement for check transactions. (b)

Rulemaking

(1)

In general

The Board shall have authority to promulgate rules regarding any interchange transaction fee that is charged with respect to an electronic debit transaction. (2)

Considerations

Rules promulgated by the Board pursuant to paragraph (1) shall be based on— (A)historic policies implemented by the Board that have ensured that checks clear at par; and (B)the Congressional finding under subsection (a) that electronic debit transactions serve as a functional replacement for check transactions. (c)

Exemptions

The Board may exempt financial institutions, including those regulated by the National Credit Union Administration, that, together with affiliates, have assets of less than $1,000,000,000 from the rules promulgated by the Board pursuant to subsection (b). (d)

Definitions

For purposes of this section: (1)

Board

The term Board means the Board of Governors of the Federal Reserve System. (2)

Electronic debit transaction

The term electronic debit transaction means a transaction in which a person uses a debit card or other device that has been approved for use in a payment card network to debit an account for the purpose of transferring money between accounts or obtaining goods or services. (3)

Interchange transaction fee

The term interchange transaction fee means any fee established, charged, or received by an issuer or a payment card network on a per-transaction basis that has been established for the purpose of compensating the issuer or payment card network for its role in authorizing, clearing, settling, or otherwise processing an electronic debit transaction. (4)

Issuer

The term issuer means a financial institution that issues cards or other devices that have been approved for use in a payment card network. (5)

Payment card network

The term payment card network means an entity that directly, or through licensed members, processors, or agents, provides the proprietary services, infrastructure and software that route information and data to conduct transaction authorization, clearance and settlement, and that a person is required to access in order to accept a specific brand of credit card, debit card, prepaid card or similar device as a form of payment.

Limitation on credit card network restrictions

(a)

In general

Chapter 2 of the Truth in Lending Act (15 U.S.C. 1631 et seq.) is amended by adding at the end the following new section:

140B.

Limitation on credit card network restrictions.

(a)

In general

A credit card network may not, directly or through any agent, processor, or licensed member of the network, by contract or otherwise, inhibit the ability of any person— (1)to set a minimum or maximum dollar value for such person’s acceptance of any form of payment; or (2)to offer a discount, benefit, or anything else of value to customers in order to create an incentive for customers to pay such person using a form of payment that carries lower transaction fees or costs for such person. (b)

Credit card network defined

For purposes of this section, the term credit card network means an entity that directly, or through licensed members, processors, or agents, provides the proprietary services, infrastructure, and software that route information and data to facilitate transaction authorization, clearance, and settlement that a person must access in order to accept a specific brand of general-purpose credit card as payment for goods or services.

(b)

Clerical amendment

The table of sections for chapter 2 of the Truth in Lending Act is amended by inserting after the item relating to section 140A the following new item:

140B. Limitation on credit card network restrictions