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Vermont becomes first state to pass swipe fees law
BURLINGTON, Vt. (5/25/10)--Vermont became the first state Friday to pass a law that limits swipe fees on credit and debit purchases. The passage comes one day after the U.S. Senate Thursday approved a measure to regulate interchange fees as a part of a financial regulatory reform bill. The Vermont law will allow retailers to set a $10 minimum for credit and debit card charges and give a discount to shoppers who pay with cash beginning Jan. 1 (The Washington Post May 22). The Association of Vermont Credit Unions (AVCU) lobbied on behalf of state credit unions to try and prevent passage of the bill, S. 138, saying it could harm the ability of consumers to use their credit and debit cards at merchant locations statewide. The legislation was strongly opposed by AVCU, and although the measure passed, AVCU's lobbying efforts resulted in some improvements in the final bill. (SEE RELATED: Vermont card acceptance bill moves to governor’s desk). AVCU is undecided whether to pursue a future legislative campaign to try to alter the new state law, according to Joe Bergeron, AVCU president. “Our short-term focus, and that of our state regulator should the version in Congress attached to financial restructuring legislation become law, will be to conceive how state and federal versions will interplay, if at all,” he said. “The federal provision being considered goes much, much further in its potential negative impact on credit union card programs than the far more limited Vermont provisions resulting from very active lobbying efforts in the Vermont statehouse.” Vermont Gov. James Douglas will not sign the bill, but he also will not veto it, which means it will become law. In a letter to David Gibson, Vermont secretary of state, Douglas said that he sympathizes with the concern of Vermont’s merchants regarding credit card fees, credit card rules and interchange fees imposed on them without the opportunity to negotiate terms and the freedom to choose pricing options. However, Douglas said he does not believe such legislation should be handled at the state level. “This is a national, if not an international, issue that is best addressed in a wider forum,” he said.
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