(TORONTO) - Retail Council of Canada (RCC) vigorously applauds the Financial Consumer Agency of Canada (FCAC) for its recognition that some companies in the credit and debit card industry have been engaged in inappropriate sales and disclosure practices.
"We thank Commissioner Ursula Menke for her hard work and for recognizing that retailers have been dealing with unfair and unscrupulous practices from some in the payment card industry," said Diane J. Brisebois, President and CEO, RCC. "We are particularly pleased that the Commissioner addressed RCC’s concerns that the Code of Conduct (the Code), for the payment card industry was being undermined by inappropriate sales and business practices."
During the preparation of the guidance document, RCC’s submission, called for Commissioner Menke to examine specific areas where the Code was being ignored or undermined. Brisebois noted that the Commissioner has responded to these concerns, and is demanding the payment card industry “promptly address these issues”.
Areas of concern raised by RCC’s merchant members and the Commissioner’s response:
Merchants: Sales and Business Practices – Our merchants noted that discrepancies between agreements and statements were often misleading or dishonest, lacked clarity and were incomplete.
Commissioner: “Payment Card Network Operators (PCNOs) will work directly with their participants to promptly address sales or business practices within their networks that are inconsistent with the requirement to provide clear and simple disclosure to merchants or that may be misleading to merchants.”
Merchants: Disclosure in multiple provider agreements – Our merchants often thought they were signing a single contract provider agreement, but instead found themselves obligated to multiple service providers. Our merchants asked that key information affecting the merchant must be disclosed in a clear, easy to understand manner prior to signing any contact.
Commissioner: “PCNOs will work with their participants to improve the clarity of disclosure to be provided to merchants … by requiring that key information be presented in a manner that is easy for merchants to find and understand.”
“Some in the payment card industry have buried agreements within agreements within agreements which misinform and mislead merchants,” said Brisebois. “We are grateful that Commissioner Menke is taking a hard line on this.”
Merchants: Multiple contract cancellation penalties, costs or fees - Merchants signed merchant/acquirer agreements with some companies, to later discover they had actually entered into additional contracts for related services. As permitted under the Code, merchants could cancel their contract without penalty, but then found out there were additional costs or penalties to cancel related contracts.
Commissioner: “PCNOs will work with their participants to ensure that, consistent with Element 3 of the Code, merchants will be permitted to cancel the merchant-acquirer agreement and all related service contracts without penalty, following notification of any new or increased fees by any participant or related service providers.”
"RCC and our merchants have been and will continue to call for stricter rules on the payment card industry to protect retailers and their customers,” Brisebois said. “Round two is the Competition Tribunal and we look forward to their ruling.”