An Assembly committee today approved legislation backed by Visa and consumer groups that would bar retailers from imposing "swipe" fees when customers use debit cards--even though few retailers actually charge such fees.
The bill was the focus of this column last Thursday. Sen. Jenny Oropeza, a Long Beach Democrat, defended her bill here.
Visa is backing similar measures in 10 other states across the country.
The Judiciary Committee voted 7-1 to approve the bill, SB 933. It will head to the Assembly floor for a final vote before heading to Gov. Arnold Schwarzenegger.
Debit card companies such as Visa generally charge merchants about 35 cents to process debit card transactions. The bill would bar retailers from passing along the costs to customers.
BP-ARCO gas stations pass along debit card charges to customers. But Visa's contracts with other merchants generally bar them from charging fees. Those contracts are a focus of an antitrust lawsuit by retailers pending in federal court in New York.
If the bill becomes law, Visa could hope that it would be insulated from liability in the case.
Although Visa backed Oropeza's measure, a lobbyist for the bill's "sponsor," Consumers' Union, took the lead testifying for it. Others including a lobbyist for the California Labor Federation-AFL-CIO also spoke on behalf of the bill.
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