bodyType

customContents

entityId

entityUuid

articlePageQuery

filter

article

articleBaseAdvertisingInfoArticle

articleListArticle

articleSeoArticle

hooksArticleAcknowledgementGateOverlayArticle

hooksTrackPageViewArticle

hooksContentInterestArticle

articleLinkingDataContent

hooksAmpRedirectArticle

articleSchemaContent

liveArticle

advertZone

sentiment

contentLock

topics

types

sections

paywallTypes

createdDate

publishedDate

urlAlias

moreOnThisArticles

sponsorType

commentCount

authorLocations

authors

corrections

displaySlideShow

multimediaEmbed

printHeadline

seriesContainer

articleSpeeches

socialHeadline

headline

images

flag

firstTopic

glossary

flattenTypeIds

image

relatedLinks

relatedNewsletters

__typename

sponsor

pdfFiles

seriesReverseOrder

series

disableOffPlatformContent

published

updatedDate

summary

subHeadline

body

keywords

readingTime

customTimezone

liveContents

Minimum spending limits and surcharges are prohibited, says Consumer Council
Minimum spending limits and extra surcharges for credit card purchases should be swiped from the  landscape, a consumer watchdog said yesterday.
The Consumer Council said the surcharge - a way of shop owners passing on their merchant handling fees to customers - and the minimum spending limits are 'prohibited' practices.
'The Consumer Council has obtained the clear and unanimous assurance from the three major credit card associations, namely Visa, Mastercard and American Express, that such practices are prohibited and in breach of international operating regulations,' said  Ron Hui, its  vice-chairman of the publicity and community relations committee.
'Under the operating regulations, merchants are not allowed to impose any [restrictions] in acceptance of credit cards for payment.'
The  council did not name any establishments, but said some merchants were allegedly placing a surcharge of 2 per cent or higher on credit card purchases. The watchdog also said there were allegations about store owners setting minimum spending limits of HK$200 or more for those using credit cards.
'Specifically, merchants must not add any surcharge to the transaction amount,' Professor Hui said. 'Furthermore, merchants must not set any minimum spending limit; they must honour all cards properly presented for payment, even for small transaction amounts.'
Meanwhile, travel agencies, restaurants and jewellery employees appeared confused over their company policy regarding surcharges and minimum spending limits.
Local travel agency EGL Tours charges  2.5 per cent in 'procedural fees' for credit card transactions made over the phone. 'Our company discourages credit card transactions,' a company sales representative said, adding that it preferred payments by cash, cheque, or EPS. 'Hong Kong law doesn't allow us to refuse cash deals, but we're not limited in terms of credit card transactions.'
Causeway Bay eatery Baby Blue Cafe and Bar demands a minimum bill  of HK$100 for credit card payments. 'That's to offset the payments we have to make to the credit card centre,' a waitress said.
Meanwhile, a salesman at Koon Chiu jewellery store in Temple Street claimed that his shop's 3.5 per cent charge  offsets 'bank surcharges on the sales of gold' - an item, HSBC asserted, is non-existent.
'We have a signed agreement with merchants offering credit card services that they cannot disclose information about merchant handling fees to the public. Nor are they supposed to shift the burden to consumers,' an HSBC spokeswoman said.
Paul Leung Yin-lam, managing director of travel agency Holiday World Tours, said if his agency could no longer impose a surcharge, he would have to use alternative means.
'Our packages can't be too cheap because we have to cover costs. If we can't cover costs through imposing surcharges, we'll hitch up the prices of our tours,' said Mr Leung, who added that 'at the  moment, we won't make any huge policy adjustments'.
While prohibited by credit card companies, the practices are not illegal.  But the  council said  people were not helpless.
More than 15 credit card issuing banks contacted by the council said they would 'handle requests' for surcharge refunds as long as the surcharges were listed separately on the receipt. The watchdog also suggested consumers should refuse to accept any restrictions imposed by merchants and card suppliers to  ensure that merchants follow the rules and regulations.
What can be done?
Credit card issuers should tell cardholders what is prohibited in service contracts with merchants, and spell out the procedures for surcharge refunds Consumers should reject any restrictions imposed by merchants and report such incidents to card issuers Card associations should strengthen communication and ensure merchants comply with the rules, as well as handle complaints positively



Watchdog targets credit card ploys