Consultation on guidance for the enhancements of the Code of Conduct for the Credit and Debit Card Industry in Canada

Invitation for comments

We invite all interested parties to submit their comments by email to compliance@fcac.gc.ca​. We will also accept written comments by mail or fax at: 

Financial Consumer Agency of Canada
Supervision and Promotion Branch
427 Laurier Avenue West, 6^th floor
Ottawa, ON K1R 1B9
Fax: 613-941-1436 

All submissions must be received by April 15, 2016. Individual submissions will not be published. By submitting a response to this consultation, you consent that portions of your response may become public and may be posted on the Financial Consumer Agency of Canada’s (FCAC) website. Where necessary, comments submitted may be revised to remove sensitive information. FCAC may wish to quote from or summarize comments in its public documents and post all or part of them on its website. Please indicate clearly if you would prefer that the FCAC withhold all or part of your comments from its public documents.

Persons making comments should be aware that all comments received by the FCAC will be subject to the Access to Information Act and may be disclosed in accordance with its provisions. 

Back​gr​ound

In April 2010, the Government of Canada introduced the Code of Conduct for the Credit and Debit Card Industry in Canada (the Code). The Code was developed to promote greater transparency for users of credit and debit cards, as well as to enhance fairness, clarity and choice within the credit and debit card industry.

In April 2015, the Government announced amendments to the Code which require that all disclosure documents provided under the Code be presented in a manner that is clear, simple and not misleading. 

It also amended Element 1 of the Code to require that all merchant-acquirer agreements include a cover page containing an information summary box that provides key elements of the agreement in a single location. The cover page must also contain a fee disclosure box which provides merchants with clear pricing information on credit and debit card acceptance. 

Three guidance documents have been drafted to assist stakeholders with the implementation of the new disclosure requirements. For the purpose of this public consultation, the Agency is seeking comments and feedback on the following documents: 

1. Amended Commissioner’s Guidance 10: Increased disclosure in sales and business practices and cancellation of contracts without penalty
2. New Commissioner’s Guidance 15: Information summary box examples
3. New Commissioner’s Guidance 16: Fee disclosure boxes​ 

Proposed Gui​dance

1. Amended Com​missioner’s Guidance 10: Code of Conduct for the Credit and Debit Card Industry in Canada – Increased disclosure in sales and business practices and cancellation of contracts without penalty (CG-10)

In 2013, the Agency issued guidance to ensure that merchants dealing with multiple participants were provided clear disclosure of key elements of their agreements. The guidance required this disclosure to be on a cover page at the beginning of the agreement and strongly encouraged the adoption of an information summary box.

In its enhancements of the Code, the Department of Finance added elements of CG-10 directly to the Code. As a result of these amendments, FCAC reviewed CG-10 to remove potential areas of overlap, duplication and inconsistency with the amended Code.

2. New Commis​sioner’s Guidance 15: Code of Conduct for the Credit and Debit Card Industry in Canada – Information summary box examples (CG-15)

CG-10 recommended the use of an information summary box as an effective method of providing clear disclosure. Element 1 of the amended Code now provides for the inclusion of a summary box in all merchant-acquirer agreements.

3. New Com​missioner’s Guidance 16: Code of Conduct for the Credit and Debit Card Industry in Canada – Fee disclosure boxes (CG-16)

In addition to the inclusion of an information summary box, the amended Code introduced the requirement of a fee disclosure box. Its purpose is to request pricing information for the most common type of domestic payment card transactions (e.g. Visa standard credit card, Interac debit card, MasterCard standard credit card) and the most common type of processing methods, such as card present (swiped, contactless) and card not-present (mobile transaction, telephone and mail order).

CG-16 provides a prescriptive template for merchant-acquirer agreements,which was created following industry consultations. This new disclosure requirement is applicable to all Code participants.

CG-16 also contains guidance on the disclosure of all other fees charged to merchants pursuant to Element 1 of the Code. 

Next ​s​teps

Payment card networks and their participants are responsible for ensuring compliance with the amended Code requirements and adding the terms of CG-16 to their merchant agreements by November 13, 2016. ​​​​​