HB6403: Financial institutions: credit cards; merchant category codes; prohibit certain disclosure and…

HOUSE BILL NO. 6403 A bill to prohibit the disclosure and processing of certain merchant category codes; to provide for the powers and duties of certain state governmental officers and entities; and to provide remedies. the people of the state of michigan enact: Sec. 1. This act may be cited as the "privacy in purchasing act". Sec. 3. As used in this act: (a) "Disclose" means to release, transfer, or otherwise divulge a merchant category code to another person. (b) "Merchant" means a person or agent of a person that accepts credit, debit, or prepaid cards as a form of payment from customers for the purchase of goods or services. (c) "Merchant category code" means a code or other indicator that classifies the goods or services or types of goods or services involved in a transaction or that enables the classification of merchants into categories based on the type of business, trade, or service that the merchant supplies. Merchant category code includes, but is not limited to, a multidigit code issued by the International Organization for Standardization. (d) "Payment card network" means a person or an agent of a person that enables a merchant to accept credit, debit, or prepaid cards as a form of payment by providing the proprietary services, infrastructure, and software that routes the information necessary to authorize, clear, and settle the transaction. (e) "Person" means an individual or a partnership, corporation, limited liability company, association, governmental entity, or other legal entity. Sec. 5. (1) A merchant shall not disclose a merchant category code for a transaction in any manner that does either of the following: (a) Identifies or allows for the identification of the particular goods or services involved in the transaction. (b) Distinguishes the type of goods or services involved in the transaction from other types of goods or services offered by the merchant. (2) A payment card network shall not process a transaction that includes a merchant category code that in any manner does either of the following: (a) Identifies or allows for the identification of the particular goods or services involved in the transaction. (b) Distinguishes the type of goods or services involved in the transaction from other types of goods or services offered by the merchant. Sec. 7 . (1) A person may submit a complaint to the attorney general regarding an alleged violation of this act. The attorney general shall investigate a complaint submitted under this subsection and all other potential violations of this act. (2) If the attorney general determines that a merchant or payment card network has violated this act, the attorney general shall provide written notice to the merchant or payment card network . The written notice must require the merchant or payment card network to remedy the violation not later than 30 days after receiving the written notice. If the merchant or payment card network does not remedy the violation within 30 days after receiving the written notice, the attorney general may bring an action to enjoin the violation. (3) This act does not create a private right of action against a merchant or payment card network . Sec. 9 . Beginning April 1, 2029, and by each April 1 thereafter, the attorney general shall submit to the secretary of the senate and the clerk of the house of representatives a written report that includes all of the following information for the immediately preceding calendar year: (a) The number of complaints submitted to the attorney general under section 7(1). (b) The number of investigations undertaken by the attorney general for potential violations of this act. (c) A summary of each investigation undertaken by the attorney general for a potential violation of this act, including, but not limited to, any disposition of the investigation. (d) Any available data and analysis regarding the effect of this act. Enacting section 1. This act takes effect January 1, 2028.