On July 16, 2008, the House Judiciary Committee approved the Credit Card Fair Fee Act of 2008 (H.R. 5546) on a 19-16 vote. The bill allows retailers and merchants to negotiate jointly when dealing with credit card companies in determining "interchange fees." Interchange fees, effectively paid by merchants, are charged by a card issuer's bank to the merchant's bank for accepting an electronic item for a purchase. While the bill is now cleared to be considered by the full House, Judiciary Chairman Conyers noted that additional changes would likely be needed prior to scheduling a vote. The bill is highly controversial, pitting a coalition of small businesses and merchants against card companies.
The House Financial Services Committee also weighed in on the credit card industry last week, approving Financial Institutions and Consumer Credit Subcommittee Chairwoman Maloney's Credit Cardholders Bill of Rights Act of 2008 (H.R. 5244). Her bill, which includes several provisions similar to the proposed Federal Reserve rule that was issued in May, would ban universal default, double-cycle billing and require a 45-day notice prior to an interest rate increase, among other provisions. Given the limited legislative days remaining in the 110th Congress, it is unlikely that the bill will be considered by the full House and even less likely that the Senate would consider it, or comparable legislation. The Committee vote may be more symbolic – a message to the Fed to enact its proposed rule without weakening any of the consumer protections established.