Micheál Martin (Cork South Central, Fianna Fail)

There is always a good chance of success on St. Valentine's Day.

We have examined this within the Department as well. We have had some animated discussions internally on the merits of the amendment. Of course the intention and motivation behind the amendment has significant merit. It is designed to prohibit a trader discriminating between consumers on the basis of the consumer's chosen method of payment for the product in question. Some traders charge an additional amount to consumers if they choose to pay by credit card. In other cases traders will charge additional amounts if a consumer opts to pay by cash or cheque instead of by direct debit.

In introducing a regulation of this kind we need to be satisfied that the rules we are establishing will have the desired effect and will not inadvertently produce some other unintended consequence which might not be in the best interest of consumers.

I do not like the imposition of additional charges based on the payment method. However, in so far as such charges might have any saving grace, they are at least transparent and the consumer knows that he or she is paying the charge. Most consumers will then have the choice as to whether they pay the charge or not. I accept that this is not always the case and, in particular, problems can arise in the case of vulnerable consumers or those with special needs. The question also arises of whether we should be leaving it to the marketplace in any event to determine price levels.

By prohibiting these charges, we could be open to the charge that we may well cause them to become hidden. If the trader were, as a consequence of the prohibition, to build the charge into a higher price which he or she then would charge to everyone regardless of how he or she pays, then no consumer interest would have been served.

The corollary of a surcharge is that some traders might like to characterise the practice as one of providing a discount for a particular payment method. For example, one trader might display a charge of €50 for a product but stipulate that it would be available at a discount price of €47.50 if the consumer pays cash. That is no different from a trader stating that the price is €47.50 but there will be a surcharge of €2.50 for paying by credit card. The first of these practices would not be captured by Senator Cox's amendment — neither do we necessarily want to capture it — and the second practice probably would be prohibited by it.

The other issue that would need to be examined is whether or not the prohibition would prevent the trader from recovering a legitimate cost to him of doing business. For example, it would be absurd to prohibit a trader from building the cost of heating and lighting his premises into the price he charged for his products, nor would we seek to prevent a charge for delivery of a product.

In the same way, if a trader incurs an additional cost for processing credit card charges — I am not certain that he or she does in all cases — then that is a legitimate business cost and the trader should be entitled to recovery of that cost. Senator Cox made a compelling point, with which I have sympathy, that a range of costs which go into the production and delivery of a product determine the ultimate price and market forces should apply.

I am also taken by the revelation by Senator Cox that the rules of Mastercard have changed. On a voluntary basis the rules of certain payment card schemes prevented discrimination on grounds of method of payment, but now one of the card companies has removed them.

The other technical point is that we could not insert the amendment into section 52 as it would have the effect of extending the list of commercial practices prohibited by the Unfair Commercial Practice Directive. The maximum harmonisation nature of the directive would not permit us to do that and we might well face sanctions from the Commission for seeking to do so.

Nevertheless, I support the intent behind Senator Cox's suggestion and will carefully consider the legal and policy issues associated with an amendment of this sort over the coming days. With Senator Cox's agreement, I intend to reflect on the amendment with a view, if we can get over the technical nature of the difficulties I highlighted, to introduce a suitable amendment to the Bill before it completes its passage through the Oireachtas. The time involved would mean we would have to introduce the amendment in the Dáil and bring it back here to the Seanad for subsequent agreement.

I take on board what Senators Leyden and Coghlan have stated. I ask Senator Cox to accept our good faith in crafting an amendment, which is legally and technically correct and which achieves the objective set out in her amendment. I accept her point that she is speaking on behalf of many consumers and that this is a consumer protection Bill. This would be received well by consumers generally.