A few days ago, Gov. Murphy signed a new law that is designed to protect shoppers from surprise credit card fees, and prevent businesses from making a profit off of credit card fees. This change should help ensure that New Jersey’s historically strong consumer protection laws keep pace with changes in consumer behavior.
New Jersey businesses have always been able to pass the fees they are charged by credit card processing companies on to consumers who choose to pay via credit card.
But some businesses have not been telling customers that they will be paying these fees. And other businesses are actually turning a profit when customers use credit cards by charging the customer a credit card processing fee that is greater than the one the business is paying. A4284/S3508 puts a stop to both of these practices.
Starting immediately, any New Jersey business that passes credit card surcharges and fees on to their customers must clearly state that they are doing so.
Businesses must provide “clear and conspicuous” notifications to consumers at a business’ entrance and at the point of sale, if they pass on credit card processing fees to their customers. Restaurants must put these notifications on their menus.
If fees will be charged through a telephone transaction, a verbal notice must be given. Consumers should know exactly how much they are going to be charged before they agree to a purchase or have their card swiped.
Businesses must also ensure that the credit card processing fees they charge consumers are less than or equal to the fees they themselves are being charged. It is now against the law to profit off of credit card transaction fees.
In his statement marking the law’s enactment, Gov. Murphy spelled out his reasons for championing this legislation:
“As our post-pandemic economy continues to grow and evolve, we too must adapt to best safeguard New Jersey consumers against unfair practices. All residents and visitors doing business in New Jersey deserve the utmost transparency with respect to their transactions, especially given the affordability challenges experienced by our low- and moderate-income families. Today’s legislation marks yet another step New Jersey is taking to ease those pressures and put well-earned money back in the pockets of hardworking New Jerseyans.”
Ensuring Compliance & Enforcing the Law
Consumers who believe a business is violating the new law can file a complaint with the Consumer Affairs or reach out to the Dressel/Malikschmitt team for assistance. Our attorneys have experience bringing consumer complaints on behalf of individuals and groups of plaintiffs who together file a class action.
We are also here to help businesses who must comply with this and other consumer protection laws identify the regulations that apply to them and interpret their meaning. Dressel/Malikschmitt serves as outside general counsel for a number of New Jersey businesses that count on us to help them comply with our state’s ever-changing laws.
Please contact Dressel/Malikschmitt today if we can be of assistance.