“(2) LIMITATION ON RESTRICTIONS ON OFFERING DISCOUNTS FOR USE OF A FORM OF PAYMENT.-

“(A) IN GENERAL-A payment card network shall not, directly or through any agent, processor, or licensed member of the network, by contract, requirement, condition, penalty, or otherwise, inhibit the ability of any person to provide a discount or in-kind incentive for payment by the use of cash, checks, debit cards, or credit cards to the extent that-

“(i) in the case of a discount or in kind incentive for payment by the use of debit cards, the discount or in-kind incenttive does not differentiate on the basis of the issuer or the payment card network;

“(ii) in the case of a discount or in-kind incentive for payment by the use of credit cards, the discount or in-kind incentive does not differentiate on the basis of the issuer or the payment card network; and

“(iii} to the extent required by Federal law and applicable State law, such discount or in-kind incentive is offered to all prospective buyers and disclosed clearly and conspicuously.

“(8) LAWFUL DISCOUNTS.-For purposes of this paragraph, the network may not penalize any person for the providing of a discount that is in compliance with Federal law and applicable State law.

“(3) LIMITATION ON RESTRICTIONS ON SETTING TRANSACTION

MINIMUMS OR MAXIMUMS.-

“(A) IN GENERAL-A payment card network shall not, directly or through any agent, processor, or licensed member of the network, by contract, requirement, condition. penalty, or otherwise, inhibit the ability-

“(i} of any person to set a minimum dollar value for the acceptance by that person of credit cards, to the extent that –

“(I) such minimum dollar value does not differentiate between issuers or between payment card networks; and

“(II) such minimum dollar value does not exceed $10.00; or

“(ii) of any Federal agency or institution of higher education to set a maximum dollar value for the acceptance by that Federal agency or institution of higher education of credit cards, to the extent that such maximum dollar value does not differentiate between issuers or between payment card networks.

7 Visa Core Rules

Merchant refuse to accept a Visa product that is properly presented for payment, for example, on the basis that the Card is foreign-issued,1 or co-branded with the Merchant’s competitor’s
Mark. Merchanst    may attempt to steer customers who initially present a Visa Card to an alternative method of payment, such as by providing discounts for cash, but may not do so in a confusing manner that denies consumer choice. Merchants may also consider whether present circumstances create undue risk, for example if the sale involves high-value electronics, but the Card signature panel is not signed, and the Cardholder does not have any other identification.
1 In the Canada Region, the US Region, and Australia, Merchant may decline to accept certain categories of Visa products for domestically issued Cards.

1. Honor All Cards
   A Merchant must accept all Cards properly presented for payment.
   If a Merchant does not deal with the public (for example: a private club), it complies with this requirement if it accepts Cards from its members.
   This does not apply:
   • To Contactless-Only Acceptance Devices, as specified in Section 5.7.2.3, “Deployment of Contactless-Only Acceptance Devices”
   • In the Canada Region, the US Region, and Australia, to certain categories of Visa products for domestically issued Cards
2. Honor All Cards – Canada Region

In the Canada Region, unless a Merchant has elected to not be a Visa Debit Acceptor, a Merchant that accepts Visa Cards must accept any valid Visa Card that a Cardholder properly presents for payment. This means that the Merchant must permit the Cardholder to choose whether to pay for a transaction with that Visa Card or with some other means of payment accepted by the Merchant.

Canada Merchants that have elected to be a Visa Debit Acceptor may choose whether or not to accept domestic Visa Credit Cards. Similarly, Merchants that have elected to be a Visa Credit Acceptor may choose whether or not to accept Visa Debit Category Cards issued by Canada Issuers.

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5.11 Prohibited Practices

required to complete the Transaction, such as for shipping purposes, or the Standards specifically permit or require such information to be collected.

A Merchant in a country or region that supports use of the MasterCard Address Verification Service (AVS) for MasterCard POS Transactions may require the Cardholder’s ZIP or postal code to complete a Cardholder-Activated Terminal (CAT) Transaction, or the Cardholder’s address and ZIP or postal code to complete a mail order, phone order, or e-commerce Transaction.

5.10.5 Discounts or Other Benefits at the Point of Interaction

NOTE: Rules on this subject appear in the “Asia/Pacific Region,” “Canada Region,” “Europe Region,” “Latin America and the Caribbean Region,” and “Middle East/Africa Region” chapters.

1. Prohibited Practices
   An Acquirer must ensure that none of its Merchants engage in any of the prohibited practices set forth in this Rule.
   1. Discrimination
      A Merchant must not engage in any acceptance practice that discriminates against or discourages the use of a Card in favor of any other acceptance brand.
      NOTE: Modifications to this Rule appear in the “Asia/Pacific Region,” “Europe Region,” “United States Region,” and “Additional U.S. Region and U.S. Territory Rules” chapters.
   2. Charges to Cardholders
      A Merchant must not directly or indirectly require any Cardholder to pay a surcharge or any part of any Merchant discount or any contemporaneous finance charge in connection with a Transaction. A Merchant may provide a discount to its customers for cash payments. A Merchant is permitted to charge a fee (such as a bona fide commission, postage, expedited service or convenience fees, and the like) if the fee is imposed on all like transactions regardless of the form of payment used, or as the Corporation has expressly permitted in writing.
      For purposes of this Rule:
      1. A surcharge is any fee charged in connection with a Transaction that is not charged if another payment method is used.
      2. The Merchant discount fee is any fee a Merchant pays to an Acquirer so that the Acquirer will acquire the Transactions of the Merchant.

NOTE: Modifications to this Rule appear in the “Canada Region” and “Additional U.S. Region and U.S. Territory Rules” chapters.

©1969-2015 MasterCard. Proprietary. All rights reserved.

MasterCard Rules • 28 May 2015 89

Provided below is a summary of certain important changes in Release 11.1 (Rl 1.1) of the Merchant Operating Regulations (published October 15, 2010, and effective April 15, 2011).

This Revision Summary is not a comprehensive list of all changes to the Merchant Operating Regulations. Please carefully review theMerchant Operating Regulations for detailed changes. Substantive changes are marked in boldface te:\.1: in the body ofthe document and a vertical “change bar” in the left margin identifies sections with changes.

This Revision Summary does not include legally binding terms of the Merchant Operating Regulations. The headings, captions, and Revision Summary contained in these Operating Regulations and in any of the other Program Documents will not be considered to be a part hereof or thereoffor purposes of interpreting or applying any provision contained in these Operating Regulations or in any of the other Program Documents, but are for convenience only.

1. Financial Industry Reform – u.s. Legislative Changes
   Several new provisions of these Operating Regulations address changes enacted into U.S. law by the Dodd­ Frank Act.
   • Section 2.4, Equal Treatment of Cards with Other Payment Cards; Equal Treatment of Card Issuers
     New rights provided to you by the Dodd-Frank Act, as detailed in Sections 2.5 and 2.10 of these Operating Regulations, are subject to your obligation in Section 2.4 not to discriminate against Cards or Card Issuers operating on the Discover Network so long as such nondiscrimination provisions are enforceable. If your Merchant Services Agreement permits you to operate in Canada, please refer to Section 5.12.
     • Section 2.5, Surcharges and Discounts
       New terms permit you to offer discounts at the point-of-sale, as provided in the Dodd-Frank Act. You may offer differential discounts depending on the method of payment (e.g., credit, debit, cash or check), but such discounts may not differentiate based on issuer or payment network. If you operate in Canada. see Section 5.12 to identify differences that apply to discounts offered in Canada
     • Section 2.10, Minimum/Maximum Dollar Limits and Other Limits
       New tenns permit you, as specified by the Dodd-Frank Act, to establish a minimum purchase amount ofup to $10.00 for Credit Cards, subject to the nondiscrimination obligations in Section 2.4.   Ifyou operate as a U.S. federal agency or an institution of higher education, you may limit the maximum amount a Cardholder may spend with a Credit Card (but not Debit or Prepaid Cards), as set forth in the Dodd-Frank Act. subject to the nondiscrimination obligations in Section 2.4.

1. Changes Impacting Merchants Operating in Canada
   If your Merchant Services Agreement permits you to operate in Canada, new terms of the Operating Regulations are included lo provide you with the benefits set forth in the Code of Conduct for the Debit and Credit Card Industry in Canada (the “Code”).
   • Section 2.4, Equal Treatment of Cards with Other Payment Cards; Equal Treatment of Card Issuers

Please note that the obligations in Section 2.4 only apply where not prohibited by applicable Requirements of Law, including the Code.

Effective April 15, 2011 This document is proprietary and confidential.

©2010 DFS Services LLC

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Merchant Reference Guide – U.S.

Card acceptance

Merchants may offer discounts or in-kind incentives from their regular prices for payments in cash, ACH funds transfer, check, debit card or credit/charge card, provided that (to the extent required by Applicable Law): (i) they clearly and conspicuously disclose the terms of the discount or in-kind incentive to their customers, (ii) the discount or in-kind incentive is offered to all of their prospective customers, and (iii) the discount or in-kind incentive does not differentiate on the basis of the issuer or, except as expressly permitted by applicable state statute, payment card network (e.g., Visa, MasterCard, Discover, JCB, American Express). The offering of discounts or in-kind incentives in compliance with the terms of this paragraph will not constitute a violation of the provisions set forth above in this section 3.2.

Whenever payment methods are communicated to customers, or when customers ask what payments are accepted, Merchants must indicate their acceptance of the Card and display our Marks according to our guidelines and as prominently and in the same manner as any Other Payment Products.

The Merchant must not use our Marks in any way that injures or diminishes the goodwill associated with the Mark, nor in any other way (without our prior written consent) indicate that we endorse the Merchant’s goods or services. The Merchant shall only use our Marks as permitted by the Agreement and shall cease using our Marks upon termination of the Agreement.

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