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Island to Follow UK Ban on Card Surcharges

Wednesday, 29 November 2017

The OFT has agreed that, subject to Tynwald approval in December, the Island will follow the United Kingdom's lead and introduce a prohibition on surcharges for consumer payments by credit card and debit card.

With effect from 13 January 2018 in the United Kingdom (and the rest of the European Economic Area (EEA)) it will be unlawful for traders to apply surcharges for consumer payments by card.

This means that it will be unlawful for businesses to, for example, add an additional percentage charge when customers pay for goods or services with a credit card.

OFT Chairman Martyn Perkins MHK explained

'Whilst the UK regulations are not directly applicable to the Island, they will indirectly impact on local businesses trading into the UK or EEA and on local consumers buying goods online. This would leave a very confusing situation and risks our consumers being placed at a disadvantage compared to their UK counterparts. The OFT has decided to make an Order under section 62A of the Consumer Protection Act 1991, applying the UK regulations to the Island with the necessary modifications.'

The practical effect of the Order will be to apply to the Island, concurrently with their introduction in the UK on 13 January 2018, the rules which prohibit the application of consumer surcharges for the use of debit and credit cards. The rules do not require a trader to accept any particular payment method, but whatever payment methods the trader accepts; the price must be the same.

Martyn Perkins concluded

'A key role of the OFT is to protect consumers and it is important to close the loophole which would disadvantage local consumers. The Order requires approval by Tynwald and I am intending to take it to the December sitting.'

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