LONDON: Britain plans to ban companies from making their customers pay excessive credit and debit card surcharges when buying flights and other services, ahead of a similar move by the European Union. Firms will be allowed to add just a small charge to cover their actual costs.
Payment surcharges are especially prevalent in the airline sector, where Britain's Office of Fair Trading (OFT) has estimated that British consumers spent 300 million pounds ($470 million) on such fees in 2009.
"We want to make sure that consumers paying by card do not have to pay excessively high surcharges being imposed on them by some airlines and other businesses," consumer minister Edward Davey said in a statement on Friday.
The ban will apply to most retail sectors, not just the transport sector.
The European Union Consumer Rights Directive will ban businesses in many sectors, including airlines, from imposing above-cost surcharges on payments from mid-2014.
The British government plans to consult on implementing this provision of the directive early, with the goal of banning above-cost surcharges by the end of 2012.
"We need to consult to get those rules right. We need to make sure the right process is in place to help consumers challenge companies that levy excessive surcharges and we need to give business some time to get their systems ready," Treasury minister Mark Hoban told the BBC.
Irish airline Ryanair said its 6 pounds booking administration charge did not apply to all cards. "I would not expect the rules to affect us as we don't impose any debit or credit card fees. Our administration charge can be avoided using certain types of cards," said Ryanair spokesman Stephen McNamara.
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