Billing Practices and Payment Compliance Reviews

Rome LLP advises businesses and payment companies on customer billing practices, including customer disclosures, evidence of consent, and billing records. The firm routinely evaluates subscriptions, recurring shipments, stored payment credentials, and cash-and-card pricing programs under federal and state law and card-brand rules. We examine the transaction from the initial offer through checkout and any cancellation or refund request, comparing the customer-facing materials with the corresponding transaction and account records.

Recurring Billing, Consent, and Cancellation

Before obtaining billing information, the business should clearly and conspicuously tell the customer that the subscription will continue until canceled, the amount and frequency of recurring charges, when any trial or promotional period ends, and how to cancel. Any material refund restriction should appear with those terms, not only in a linked agreement, and nothing elsewhere in the offer should contradict them.

Disclosure is not consent. The checkout should require a separate affirmative act accepting the material terms of the subscription offer. The business should retain a copy of those terms as presented at checkout, together with evidence of the customer’s acceptance. A prechecked box, passive assent, or a checkout that can be completed without that action does not reliably establish express informed consent.

A customer paying through Apple Pay, PayPal, or another wallet should see and accept the material subscription terms before authorizing payment.

For an online subscription, cancellation should be available online and should stop future renewal charges without unnecessary obstacles. A business that promises one-click or immediate cancellation should not require the customer to complete a questionnaire, respond to a retention offer, or contact customer service as a condition of cancellation.

Material changes to an existing automatic-renewal or continuous-service plan may require clear and conspicuous advance notice and information about how to cancel. Posting revised terms on a website may not bind existing customers. The business should preserve the prior terms, revised terms, and the notice sent to affected customers.

Confirmations, Receipts, and Transaction Records

A post-purchase confirmation should give the customer a clear, retainable record of the purchase and charge. For an automatically renewing subscription or other continuity plan, it should also state the renewal terms and explain how to cancel.

Each recurring charge should generate a receipt that accurately identifies the charge. If the receipt is provided by link, the link should open directly to the complete receipt and remain accessible to the customer.

The business should be able to retrieve the checkout disclosures presented to that customer and the record of acceptance. For an in-person transaction, the point-of-sale record should show how the card was presented and authorized.

Without those records, the business may be unable to defend a chargeback or respond to an FTC investigation.

Surcharges, Convenience Fees, Cash Discounts, and Dual Pricing

The label on a sign, screen, or receipt does not control. In a genuine cash-discount or dual-pricing program, the card price is the regular price and the customer receives a lower price for paying cash. The merchant may display the card price alone or show the cash and card prices together. If the merchant displays the lower price and adds an amount when the customer chooses a card, the added amount is a surcharge.

A convenience fee is charged for the use of an eligible alternative payment channel, not merely because the customer pays by card. Card-brand rules generally require the fee to be fixed, disclosed before payment, and applied consistently to the payment methods offered through that channel. A convenience fee cannot be used to disguise a card surcharge or added to a transaction that already includes one.

Rome LLP examines the prices shown on shelves, menus, websites, and signs, along with the complete checkout process and receipt. We determine which price is stored as the regular price, whether the system subtracts a cash discount or adds a card fee, and which payment methods incur the difference. We also test how the system handles credit, debit, prepaid and gift cards, taxes, refunds, transaction data, and receipt disclosures.

A surcharge may be imposed only on eligible credit-card transactions. Visa generally limits the surcharge to the lesser of the merchant’s applicable merchant discount rate or 3% of the transaction amount. Mastercard generally limits it to the lesser of the merchant’s applicable surcharge cap or 4%. For a merchant that accepts and surcharges both Visa and Mastercard at the same rate, Visa’s lower 3% cap will ordinarily set the effective ceiling. Debit and prepaid cards may not be surcharged, even if the customer selects “credit” at the terminal.

Before implementation, the merchant should obtain any required approval from its acquirer and confirm and complete the notice or registration process required by each card brand. The surcharge must be disclosed before payment, included in the transaction data, and shown separately on the receipt. State law may impose additional restrictions even when the program satisfies the card-brand rules.

Rome LLP also checks whether the merchant account is configured for the business’s actual billing practices and identifies any material mismatch with the customer-facing offer or transaction records.