88R23121 SRA-D     By: Capriglione H.B. No. 3395     Substitute the following for H.B. No. 3395:     By:  Bhojani C.S.H.B. No. 3395       A BILL TO BE ENTITLED   AN ACT   relating to the charging of swipe fees on certain electronic   payment transactions; authorizing a civil penalty.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Title 12, Business & Commerce Code, is amended by   adding Chapter 610 to read as follows:   CHAPTER 610. CHARGING OF SWIPE FEES          Sec. 610.001.  DEFINITIONS. In this chapter:                 (1)  "Assessment fee" means a fee, usually based on the   total amount of monthly sales, paid directly to the payment card   network for allowing a merchant to use a payment card or other   payment code or device in an electronic payment transaction.                (2)  "Electronic payment transaction" means a   transaction in which a person uses a payment card or other payment   code or device issued or approved through a payment card network to   debit a deposit account or use a line of credit, whether   authorization is based on a signature, personal identification   number, or other means.                (3)  "Interchange fee" means a fee charged to a   merchant for the purpose of compensating the payment card issuer   for the issuer's involvement in an electronic payment transaction.                (4)  "Payment card" means a credit card, debit card,   check card, or other card that is issued to an authorized user to   purchase or obtain goods, services, money, or any other thing of   value.                (5)  "Payment card issuer" means a lender, including a   financial institution, or a merchant that receives applications and   issues payment cards to individuals.                (6)  "Payment card network" means an entity that   directly, or through a licensed member, processor, or agent,   provides the proprietary services, infrastructure, and software   that route information and data to conduct debit card or credit card   transaction authorization, clearance, and settlement, and that an   entity uses in order to accept as a form of payment a brand of debit   card, credit card, or other device that may be used to carry out   debit or credit transactions.                (7)  "State or local tax" includes a tax imposed by this   state or a unit of local government of this state, including the   sales, excise, and use tax, motor fuels tax, hotel occupancy tax,   mixed beverage sales tax, and tax imposed on the rental of a motor   vehicle, other than a tax returned to a taxpayer in the form of a   deduction or discount under Section 151.423 or 151.424, Tax Code.                (8)  "Swipe fee" means the interchange fee and, if   applicable, the assessment fee.          Sec. 610.002.  APPLICABILITY.  This chapter applies only to   electronic payment transactions conducted by a merchant that is a   small business as defined by the United States Small Business   Administration on September 1, 2023.          Sec. 610.003.  EXCLUSION OF STATE OR LOCAL TAXES FROM SWIPE   FEES; MERCHANT DEDUCTION OR REBATE.  (a)  The amount of state or   local tax that is calculated as a percentage of the amount of an   electronic payment transaction and listed separately on a payment   invoice or other demand for payment must be excluded from the total   amount on which a swipe fee is charged for that transaction.          (b)  A payment card network shall with respect to each form   or type of electronic payment transaction:                (1)  deduct the amount of state or local tax imposed   from the calculation of swipe fees attributable to the transaction   at the time of settlement; or                (2)  rebate the merchant an amount equal to the amount   of swipe fees attributable to the state or local tax imposed on the   transaction.          (c)  A deduction or, subject to Subsection (d), a rebate   under this section must occur at the time of settlement when the   merchant is able to capture and transmit state or local tax or fee   amounts relevant to the sale at the time of sale as part of the   transaction finalization.          (d)  If a payment card network does not capture or transmit   tax or fee amounts relevant to a sale at the time of sale under   Subsection (c), a merchant may, not later than the 180th day after   the date of the sale, submit to the payment card network a request   for a rebate under Subsection (b)(2) together with proof of the tax   or fee amounts collected on the sale subject to a swipe fee.  The   payment card network must accept a copy of filed tax returns or   sales data provided by the merchant as proof of the tax or fee   amounts collected on the sale.  Not later than the 30th day after   the date a payment card network receives proof of the tax or fee   amounts collected on the sale from a merchant under this   subsection, the payment card network shall, in accordance with   Subsection (b)(2), rebate the merchant an amount equal to the   amount of swipe fees attributable to the state or local tax imposed   on the sale.          Sec. 610.004.  CIVIL PENALTY; RESTITUTION.  (a)  A person who   violates this chapter is liable to this state for a civil penalty in   an amount not to exceed $1,000 for each violation.          (b)  The attorney general may bring an action to:                (1)  recover the civil penalty imposed under this   section; or                (2)  obtain a temporary or permanent injunction to   restrain the violation.          (c)  An action under this section may be brought in a   district court in:                (1)  Travis County; or                (2)  a county in which any part of the violation occurs.          (d)  The attorney general shall deposit a civil penalty   collected under this section in the state treasury to the credit of   the general revenue fund.          (e)  A person who violates this chapter shall refund a   merchant any swipe fees charged in violation of this chapter.          SECTION 2.  This Act takes effect September 1, 2023.