[Federal Register Volume 78, Number 202 (Friday, October 18, 2013)]
[Notices]
[Pages 62352-62354]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-24508]


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FEDERAL RESERVE SYSTEM


Proposed Agency Information Collection Activities; Comment 
Request

AGENCY: Board of Governors of the Federal Reserve System.
SUMMARY: On June 15, 1984, the Office of Management and Budget (OMB) 
delegated to the Board of Governors of the Federal Reserve System 
(Board) its approval authority under the Paperwork Reduction Act (PRA), 
pursuant to 5 CFR 1320.16, to approve of and assign OMB control numbers 
to collection of information requests and requirements conducted or 
sponsored by the Board under conditions set forth in 5 CFR Part 1320, 
Appendix A.1. Board-approved collections of information are 
incorporated into the official OMB inventory of currently approved 
collections of information. Copies of the Paperwork Reduction Act 
Submission, supporting statements and approved collection of 
information instruments are placed into OMB's public docket files. The 
Federal Reserve may not conduct or sponsor, and the respondent is not 
required to respond to, an information collection that has been 
extended, revised, or implemented on or after October 1, 1995, unless 
it displays a currently valid OMB control number.

DATES: Comments must be submitted on or before December 17, 2013.

ADDRESSES: You may submit comments, identified by FR 3064a and FR 
3064b, by any of the following methods:
     Agency Web site: http://www.federalreserve.gov. Follow the 
instructions for submitting comments at http://www.federalreserve.gov/apps/foia/proposedregs.aspx.
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Email: [email protected]. Include OMB 
number in the subject line of the message.
     FAX: (202) 452-3819 or (202) 452-3102.
     Mail: Robert deV. Frierson, Secretary, Board of Governors 
of the Federal Reserve System, 20th Street and Constitution Avenue NW., 
Washington, DC 20551.
    All public comments are available from the Board's Web site at 
http://www.federalreserve.gov/apps/foia/proposedregs.aspx as submitted, 
unless modified for technical reasons. Accordingly, your comments will 
not be edited to remove any identifying or contact information. Public 
comments may also be viewed electronically or in paper form in Room MP-
500 of the Board's Martin Building (20th and C Streets NW.) between 
9:00 a.m. and 5:00 p.m. on weekdays.
    Additionally, commenters may send a copy of their comments to the 
OMB Desk Officer--Shagufta Ahmed--Office of Information and Regulatory 
Affairs, Office of Management and Budget, New Executive Office 
Building, Room 10235 725 17th Street NW., Washington, DC 20503 or by 
fax to (202) 395-6974.

FOR FURTHER INFORMATION CONTACT: A copy of the PRA OMB submission, 
including the proposed reporting form and instructions, supporting 
statement, and other documentation will be placed into OMB's public 
docket files, once approved. These documents will also be made 
available on the Federal Reserve Board's public Web site at: http://www.federalreserve.gov/apps/reportforms/review.aspx or may be requested 
from the agency clearance officer, whose name appears below.
    Federal Reserve Board Clearance Officer--Cynthia Ayouch--Office of 
the Chief Data Officer, Board of Governors of the Federal Reserve 
System, Washington, DC 20551 (202) 452-3829. Telecommunications Device 
for the Deaf (TDD) users may contact (202) 263-4869, Board of Governors 
of the Federal Reserve System, Washington, DC 20551.

SUPPLEMENTARY INFORMATION:

Request for Comment on Information Collection Proposal

    The following information collection, which is being handled under 
this delegated authority, has received initial Board approval and is 
hereby published for comment. At the end of the comment period, the 
proposed information collection, along with an analysis of comments and 
recommendations received, will be submitted to the Board for final 
approval under OMB delegated authority. Comments are invited on the 
following:
    a. Whether the proposed collection of information is necessary for 
the proper performance of the Federal Reserve's functions; including 
whether the information has practical utility;
    b. The accuracy of the Federal Reserve's estimate of the burden of 
the proposed information collection, including the validity of the 
methodology and assumptions used;
    c. Ways to enhance the quality, utility, and clarity of the 
information to be collected;
    d. Ways to minimize the burden of information collection on 
respondents, including through the use of automated collection 
techniques or other forms of information technology; and
    e. Estimates of capital or start up costs and costs of operation, 
maintenance, and purchase of services to provide information.
    Proposal to approve under OMB delegated authority the extension, 
with revision, of the following report:
    Report title: Interchange Transaction Fees Surveys.\1\
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    \1\ The proposed debit card issuer and payment card network 
surveys, supporting statement, and other documentation are available 
on the Board's public Web site at: http://www.federalreserve.gov/apps/reportforms/review.aspx.
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    Agency form numbers: FR 3064a and FR 3064b.
    OMB control number: 7100-0344.
    Frequency: FR 3064a--Biennial; FR 3064b--Annual.
    Reporters: Issuers of debit cards (FR 3064a) and payment card 
networks (FR 3064b).
    Estimated annual reporting hours: FR 3064a: 111,600 hours; FR 
3064b: 1,350 hours. Estimated average hours per response FR 3064a: 200 
hours; FR 3064b: 75 hours.
    Number of respondents: FR 3064a: 558; FR 3064b: 18.
    General description of report: This information collection is 
authorized by subsection 920(a) of the Electronic Fund Transfer Act, 
which was amended by section 1075(a) of the Dodd-Frank Act. 15 U.S.C. 
1693o-2. This subsection requires the Board to disclose (on a biennial 
basis) aggregate or summary information concerning the costs incurred, 
and interchange transaction fees charged or received, by issuers or 
payment card networks in connection with the authorization, clearance 
or settlement of electronic debit transaction as the Board considers 
appropriate and in the public interest. 15 U.S.C. 1693o-2(a)(3)(B). It 
also provides the Board with authority to require issuers and payment 
card networks to provide information to enable the Board to carry out 
the provisions of the subsection. Response to these surveys is 
mandatory.
    In accordance with the statutory requirement, the Board currently 
releases aggregate or summary information from the survey responses, 
and, average interchange fees at the network level. In addition, the 
Board

[[Page 62353]]

will release, at the network level, the percentage of total number of 
transactions, the percentage of total value of transactions, and the 
average transaction value for exempt and not-exempt issuers obtained on 
the FR 3064b. The Board has determined to release this information both 
because it can already be calculated based on the information the Board 
currently releases on average interchange fees and because the Board 
believes the release of such information may be useful to issuers and 
merchants in choosing payment card networks in which to participate and 
to policymakers in assessing the effect of Regulation II on the level 
of interchange fees received by issuers over time. However, the 
remaining individual issuer and payment card information collected on 
these surveys will be treated as confidential under exemption (b)(4) of 
the Freedom of Information Act (FOIA), which protects information that, 
if released, would cause substantial harm to the competitive position 
of the survey respondents. 5 U.S.C. 552(b)(4) (exempting from 
disclosure ``trade secrets and commercial or financial information 
obtained from a person and privileged or confidential'').
    Abstract: The Wall Street Reform and Consumer Protection Act of 
2010 (Dodd-Frank Act) requires the Board to disclose (on a biennial 
basis) aggregate or summary information concerning the costs incurred, 
and interchange transaction fees charged or received, by issuers or 
payment card networks in connection with the authorization, clearing, 
or settlement of electronic debit transactions as the Board considers 
appropriate or in the public interest. The data from these surveys are 
used in fulfilling that disclosure requirement. In addition, the Board 
uses data from the payment card network survey (FR 3064b) to publicly 
report on an annual basis the extent to which networks have established 
separate interchange fees for exempt and covered issuers.\2\ Finally, 
the Board uses the data from these surveys in determining whether to 
propose revisions to the interchange fee standards in Regulation II (12 
CFR Part 235). The Dodd-Frank Act provides the Board with authority to 
require debit card issuers and payment card networks to submit 
information in order to carry out provisions of the Dodd-Frank Act 
regarding interchange fee standards.
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    \2\ Average debit card interchange fee by payment card network, 
http://www.federalreserve.gov/paymentsystems/regii-average-interchange-fee.htm.
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    Current Actions: The Board proposes to revise the debit card issuer 
survey (FR 3064a) to collect data on costs of authorization, clearance, 
and settlement broken out by variable costs and fixed costs, and to 
instruct respondents to exclude transactions monitoring from the 
calculation of costs of authorization, clearance, and settlement, as 
transactions monitoring costs are already collected elsewhere on the 
survey form. In addition, the Board proposes that, for the data 
collection for calendar year 2013, the survey be made available to 
respondents by February 3, 2014, with a filing deadline of March 17, 
2014.
    The Board proposes to revise the payment card network survey (FR 
3064b) to collect data on exempt general-use prepaid card transactions 
broken out between transactions using cards issued by an issuer that 
qualifies for the small issuer exemption and transactions using cards 
issued by a non-exempt issuer. In addition, the Board proposes to 
modify the confidentiality status of FR 3064b to allow for the public 
release of more data at the network level, specifically, average 
transaction values, and proportions of transactions for exempt and non-
exempt issuers for each network.
    Lastly, The Board proposes to make several clarifications 
throughout both surveys and delete data items applicable to specific 
timeframes that are no longer relevant.
    The proposed revisions to both surveys would be effective for the 
collection of calendar year 2013 data, collected as of December 31, 
2013.

Proposed Revisions to FR 3064a

Section I: Respondent Information:

    Questions 3: Do you have a general-use prepaid card program?--The 
Board proposes to delete question 3 because it is redundant.

Section II: All Debit Card Transactions and Section V: General-Use 
Prepaid Card Transactions

    Question 1: General-use prepaid card exemption: Exempt vs. non-
exempt general-use prepaid card transactions--The Board proposes to 
modify question 1.d by deleting line item 1d.1 (Volume and Value), All 
general-use prepaid card transactions between January 1 and September 
30, 2011, as this timeframe is no longer relevant. Subsequent line 
items 1d.2 and 1d.3 would be renumbered as 1d.1 and 1d.2.

Section II: All Debit Card Transactions, Section III: All Single-
Message (PIN) Debit Card Transactions, Section IV: All Dual-Message 
(Signature) Debit Card Transactions, and Section V: General-Use Prepaid 
Card Transactions

    Question 3: Costs of authorization, clearance, and settlement--The 
Board proposes to add questions 3e and 3f to break out the fixed and 
variable cost components for line items 3b.1 In-house costs and 3b.2 
Third-party processing fees, respectively. Definitions for variable and 
fixed costs would be added to the instructions.\3\ A break-out of 
variable and fixed costs would provide the Board with sufficient 
flexibility to respond to possible outcomes of pending litigation 
regarding Regulation II.
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    \3\ Fixed costs would be defined as costs that do not vary with 
changes in the number or value of transaction over the course of the 
reporting period (i.e., calendar year 2013 for this application of 
the survey).
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    The Board proposes to modify the instructions for question 3 to 
exclude transactions monitoring costs as part of the costs of 
authorization, clearance, and settlement. Transactions monitoring costs 
are currently reported in Question 5, Fraud prevention and data 
security costs, line item 5a.1 Transactions monitoring cost tied to 
authorization.

General Instructions

    The Board proposes to change the timing for conducting the calendar 
year 2013 survey. Currently, the debit card issuer survey becomes 
available to respondents in mid-February with responses due within 60 
days. To enable the Board to collect and use updated data if necessary 
to respond quickly to pending litigation regarding Regulation II, the 
Board proposes to accelerate the schedule for calendar year 2013 
survey, making the survey available by February 3, 2014, with responses 
due by March 17, 2014. Future surveys would revert to the original 
schedule (mid-February to mid-April).

Proposed Revisions to FR 3064b

Section I: Respondent Information

    Is your payment card network a single-message (PIN) or dual-message 
(signature) network? Although no revisions are proposed to this 
question, the Board requests comment on a payment card network's 
ability to process single-message transactions across dual-message 
networks and vice versa. In addition, the Board requests comment on how 
such transactions should be categorized. Based on this feedback, the 
instructions for this

[[Page 62354]]

question may be clarified as to how to categorize such transactions.

Section II: Debit Card Transactions

    Small issuer exemption: Transactions using card of exempt vs. non-
exempt issuers--The Board proposes to revise this section by deleting 
line item 1e.1 (Volume and Value), All settled purchase transactions 
between (January 1, 2011-September 30, 2011), as this timeframe is no 
longer relevant. Subsequent line items 1e.2 and 1e.3 would be 
renumbered as 1e.1 and 1e.2.
    Transactions using card of exempt vs. non-exempt issuers (January 
1, 2011-September 30, 2011)--The Board proposes to revise this section 
by deleting line items 1f through 1f.2 as this timeframe is no longer 
relevant. Subsequent line items would be renumbered accordingly.
    General-use prepaid card exemption: Exempt vs. non-exempt general-
use prepaid card transactions and General-use prepaid card exemption: 
Interchange fees on exempt vs. non-exempt card transactions--The Board 
proposes to revise line items 1g and 2i by requiring networks to 
allocate volume, value, and interchange fee revenue for exempt general-
use prepaid card transactions between transactions using prepaid cards 
issued by exempt (small) issuers (adding line items 1g.1.1 and 2i.1.1) 
and transactions using prepaid cards issued by non-exempt issuers 
(adding line items 1g.1.2 and 2i.1.2). Currently, payment card networks 
are required to allocate volume and value of general-use prepaid card 
transactions, and associated interchange fee revenue, between exempt 
and non-exempt general-use prepaid card transactions and interchange 
fees. Under Regulation II, a general-use prepaid card transaction may 
be exempt from the interchange fee standards either because the card is 
issued by an issuer that qualifies for the small issuer exemption or 
because the card qualifies for the prepaid card exemption, irrespective 
of the size of the issuer. The proposed break-out of these data would 
allow the Board to determine which type of exemption applies to each 
exempt transaction, thus improving interpretation of these data.
    Small issuer exemption: Interchange fees on transactions using card 
of exempt vs. non-exempt issuers--The Board proposes to revise this 
section by deleting line items 2g.1, All interchange fees paid to 
issuers between (January 1, 2011-September 30, 2011), and 2g.3, 
Interchange fees paid to non-exempt issuers between (October 1, 2011-
December 31, 2011), as these timeframes are no longer relevant. 
Subsequent line item 2g.2 would be renumbered as 2g.1.
    Interchange fees on transactions using card of exempt vs. non-
exempt issuers (January 1, 2011-September 30, 2011)--The Board proposes 
to revise this section by deleting line items 2h through 2h.2 as this 
timeframe is no longer relevant. Subsequent line items would be 
renumbered accordingly.
    Small issuer exemption: Network fees received from exempt vs. non-
exempt issuers--The Board proposes to revise this section by deleting 
line items 3c.1, All network fees received from issuers that settled 
between January 1, 2011-September 30, 2011, and line items 3d through 
3d.2, as these timeframes are no longer relevant. Subsequent line items 
would be renumbered 3c.1 and 3c.2.
    Small issuer exemption: Payments and incentives paid to exempt vs. 
non-exempt issuers--The Board proposes to revise this section by 
deleting line items 4c.1, All payments and incentives paid to issuers 
between January 1, 2011-September 30, 2011, and line items 4d through 
4d.2, as these timeframes are no longer relevant. Subsequent line items 
would be renumbered 4c.1 and 4c.2.

General Instructions

    Response Confidentiality and Burden--The Board proposes to revise 
the confidentiality statement to indicate that the Board may release 
some information identified by network, rather than in the aggregate, 
by total, or as an average. The Board currently publishes this 
information only at the aggregate levels across networks for signature, 
PIN, and total debit card transactions: The percent of total number of 
transactions for exempt and non-exempt issuers; the percent of total 
value of transactions for exempt and non-exempt issuers; and the 
average transaction value for exempt, non-exempt, and all issuers. This 
information can already be calculated at the network level from the 
information the Board currently releases on average interchange fees. 
Network-specific information may be useful to issuers (both exempt and 
non-exempt) and merchants in choosing payment card networks in which to 
participate and to policymakers in assessing the effect of Regulation 
II on the level of interchange fees received by exempt and nonexempt 
issuers over time. The existing confidentiality statement provides that 
only the average interchange fees for exempt and non-exempt issuers 
would be released by network.

    Board of Governors of the Federal Reserve System, October 15, 
2013.
Robert deV. Frierson,
Secretary of the Board.
[FR Doc. 2013-24508 Filed 10-17-13; 8:45 am]
BILLING CODE 6210-01-P