Senate Commerce Committee Statement to Senate, No. 3508 — State of New Jersey (May 15, 2023)

Summary

A Senate Commerce Committee statement to the Senate on Senate Bill No. 3508, State of New Jersey, dated May 15, 2023, reporting the bill favorably with committee amendments. As amended, the bill bars a seller from imposing a credit card surcharge greater than the actual cost to process the payment for a transaction in New Jersey. A seller that imposes a surcharge must disclose it before any charge, by verbal notice and signs at the point of entry and sale, on restaurant menus, on the checkout page for online sales, or verbally for telephone sales. A violation is an unlawful practice under the consumer fraud act, punishable by not more than $10,000 for a first offense and not more than $20,000 for any subsequent offense; the bill is identical to Assembly Bill 4284 (2R).

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SENATE COMMERCE COMMITTEE

STATEMENT TO

SENATE, No.
3508

with
committee amendments

STATE
OF NEW JERSEY

DATED: MAY 15,
2023

The Senate Commerce Committee reports favorably and
with committee amendments Senate Bill No. 3508.

As
amended, this bill prohibits a seller from imposing on a customer who uses a
credit card for a transaction occurring in New Jersey a surcharge greater than
the actual cost to the seller to process the credit card payment.

Under
the bill, a seller that imposes a surcharge on a customer to process a credit
card payment is to disclose the existence of the surcharge to the customer
before the customer incurs any charge for goods or services by providing verbal
notice to the customer and by posting clear and conspicuous notice on a sign at
the point of entry and point of sale, and for any restaurant, on a sign in the
customer service area and on the menu. However, if the seller is processing a
credit card payment for a transaction that will occur through an Internet website
or mobile application, the seller is to provide clear and conspicuous
electronic notice on the checkout page of the Internet website or mobile
application prior to processing the transaction. Or, if the seller is
processing a credit card payment for a transaction that will occur over the
telephone, the seller is to provide verbal notice before processing the
transaction.

The
bill defines “surcharge” to mean any additional amount imposed by a seller at
the time of a sales transaction that increases a charge to a customer for the
use of a credit card and “goods” to exclude motor fuel.

A
violation of the bill’s provisions is an unlawful practice under the consumer
fraud act. An unlawful practice is punishable by a monetary penalty of not more
than $10,000 for a first offense and not more than $20,000 for any subsequent
offense. In addition, a violation can result in cease and desist orders issued
by the Attorney General, the assessment of punitive damages, and the awarding
of treble damages and costs to the injured party.

As amended and reported by the committee, this bill is
identical to Assembly Bill 4284 (2R), as also amended and reported by the
committee.

COMMITTEE AMENDMENTS:

The committee amended
the bill to stipulate that, if the seller is processing a credit card
payment for a transaction that will occur through an Internet website or mobile
application, the seller is to provide clear and conspicuous electronic notice
on only the checkout page of the Internet website or mobile application prior
to processing the transaction and not on the website homepage and the checkout
page.

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