Mary Upton (Dublin South Central, Labour)
Link to this: Individually | In context

Question 277: To ask the Tánaiste and Minister for Enterprise, Trade and Employment when she expects the Consumer Protection Act 2007 to be fully implemented; when the ban on traders charging extra to customers based on their method of payment will be implemented; and if she will make a statement on the matter. [17278/08]

Mary Coughlan (Donegal South West, Fianna Fail)
Link to this: Individually | In context

Sections 48 and 49 are the relevant sections of the Consumer Protection Act 2007 which seek to restrict the manner in which traders impose additional charges on consumers solely by reason of the method of payment chosen by the consumer.

The Deputy will be aware that on the commencement of the Consumer Protection Act 2007 in May last year, sections 48 and 49 were not commenced. A public consultation was conducted on these provisions and, in the course of that consultation, my Department received almost 50 submissions on the impact of sections 48 and 49. The submissions gave rise to a number of complex matters which required legal advice, particularly regarding the compatibility of sections 48 and 49 with provisions of EU law.

These responses raised a number of specific issues upon which the Department sought the advice of the Attorney General. These issues related to the compatibility of sections 48 and 49 with EU law, specifically with the EU directive on unfair commercial practices and the EU payment services directive. The Attorney General's advice is that sections 48 and 49 are not compatible with the maximum harmonisation nature of the unfair commercial practices directive in that the sections seek to legislate within the field of consumer protection approximated by the directive. He argues that by going beyond what is permitted by the directive, the sections are not compatible with the maximum harmonisation nature of the directive.

As the Attorney General has advised that sections 48 and 49 are not compatible with EU law, it has been decided not to commence these provisions. I am, however, committed to the importance of consumers being made aware of the fact that a trader imposes an additional charge based on the method of payment before transacting with that trader. My Department is currently examining the possibility of making regulations under the Consumer Protection Act obliging traders who impose payment method charges to include information on those charges in any advertisements for their goods and services.

In the course of the public consultation process, retailers in opposing the introduction of section 48, maintained that they were merely passing on to the cardholder the cost imposed on the retailer by the card companies for facilitating card transactions. The Deputy may be aware of the recent decision of the competition directorate of the EU banning Mastercard from requiring retailers to pay its multilateral interchange fee for facilitating Mastercard transactions. It is understood that the competition directorate has recently commenced similar proceedings against the other major payment card scheme Visa. In that context, the advice of the Competition Authority as to the implications of this decision and its effects in Ireland, particularly in terms of the likely impact on the costs to retailers of accepting payment by particular payment methods, has been sought.