AN 1213 Revised Standards Signature Requirements Generated on 18 October 2017 Published On 18 October 2017 This PDF was created from content on the Mastercard Technical Resource Center, which is updated frequently. For the most current documentation, go to Mastercard Connect > Support.
Contents AN 1213 Revised Standards Signature Requirements................................... 3 Version History........................................................................ 4 At-A-Glance.......................................................................... 5 Overview............................................................................. 6 Questions?................................................................................ 6 Customer Impact...................................................................... 7 Acquirers and Issuers....................................................................... 7 Revised Standards..................................................................... 8 2 2017 MasterCard. Proprietary. All rights reserved.
AN 1213 Revised Standards Signature Requirements Published on Oct 18, 2017 AN 1213 Revised Standards Signature Requirements Mastercard is revising its Standards regarding the merchant s collection of a cardholder signature and the merchant s refund policy disclosure. 2017 MasterCard. Proprietary. All rights reserved. 3
Version History Published on Oct 18, 2017 Version History The version history of this announcement is as follows. Date Description of Change Where to Look 18 October 2017 Initial publication date 4 2017 MasterCard. Proprietary. All rights reserved.
At-A-Glance Published on Oct 18, 2017 At-A-Glance The At-a-Glance table provides key information about the systems and groups affected by this announcement, action indicators that specify the appropriate action, and the required implementation date or dates. Audience: Brands: Region: Category: Action Indicator: Effective Date: Acquirer, Issuer, Processor Each customer must determine the impact on its operations. Mastercard, Debit Mastercard, Maestro, Mastercard Electronic All Operations, Rules/Standards Attention warranted (Brand-related) 13 April 2018 (effective with Release 18.Q2) 2017 MasterCard. Proprietary. All rights reserved. 5
Overview Published on Oct 18, 2017 Overview Mastercard is revising its Standards to allow merchants in the Canada and United States regions the discretion to choose whether to collect a cardholder s signature on a transaction receipt or electronic signature capture device when accepting a Mastercard card in a face-to-face transaction environment. Mastercard is leading the charge in the digital evolution of payments as we continue to bring consumers peace of mind with safety, speed and choice at checkout. Today, more than 80 percent of Mastercard transactions in North America don t require a cardholder signature at checkout. We will now expand this practice and cardholder signatures will be optional for all in-store transactions in the United States and Canada in April 2018. Consumers will greatly benefit from faster, more consistent checkout experiences as merchants adopt this change over time. Merchants support the change as they have been asking for help to streamline transaction processes. Security remains a priority. Technologies including chip cards, biometrics and digital platforms such as Masterpass, use sophisticated methods to prove identity. These upgrades enable both convenience and security. As always, our zero liability protection continues to ensure that cardholders are never held responsible for fraud. In addition, Mastercard is revising its global Standards to: Modify the Standards so that Corrections in the Single Message System may be performed without a CVM Clarify that Merchant terminals must continue to support selection of signature as a CVM (even when the cardholder s signature is not collected) Modify existing text to clearly state that the merchant s refund policy printed on the paper or email receipt offered to the cardholder in a face-to-face environment will govern in the event of a dispute Modify existing text to clearly state that the refund policy the merchant disclosed to the cardholder, and that the cardholder accepted before completing the e-commerce transaction, will govern in the event of a dispute Clarify existing text to clearly state that a merchant must provide a reason for a charge for loss/ theft/damage, a reasonable repair estimate, then gain the cardholder s authorization, and then perform a card-read transaction Add an option for a loss/theft/damage transaction to be a fully authenticated SecureCode or Identity Check e-commerce transaction after the merchant provides a reason for the charge for loss/theft/damage and a reasonable repair estimate Questions? Customers with questions about the information in this article should contact the Global Customer Service team using the contact information provided on the Technical Resource Center home page. 6 2017 MasterCard. Proprietary. All rights reserved.
Customer Impact Published on Oct 18, 2017 Customer Impact This announcement affects the indicated customers and platforms. Acquirers and Issuers This announcement affects acquirers and issuers as follows. Acquirers and issuers should ensure compliance with Mastercard Standards. There is no change to cards, card designs, M/Chip (EMV) parameters or liability. Eliminating the requirement for signature collection results in no change to cards. Personalization of CVM Lists in cards must continue to support signature, while the signature panel will remain on back side of the cards. Issuers should know that all sales drafts received from merchants in the U.S. and Canada regions, in response to retrieval requests, may no longer include a cardholder signature. An acquirer whose merchant chooses to no longer collect the cardholder s signature must not change the set of CVMs supported by the terminal (whether magnetic stripe or chip). Merchants who decide to not collect cardholder signature may suppress signature prompting on their electronic signature capture devices or receipts. 2017 MasterCard. Proprietary. All rights reserved. 7
Revised Standards Published on Oct 18, 2017 Revised Standards To view marked revisions, refer to the attachment associated with this article. Additions are underlined; deletions are indicated with a strikethrough. 8 2017 MasterCard. Proprietary. All rights reserved.
Revised Standards Signature Requirements Mastercard is revising the Standards announced in the article AN 1213 Revised Standards Signature Requirements. Overview of Revised Standards Customers should review the revisions to the publication(s) in this document and make appropriate plans to support the revised Standards. Effective Date Changes to Standards in Will be Published in 13 April 2018 Transaction Processing Rules Chapter 2 Authorization and Clearing Requirements Chapter 3 Acceptance Procedures 13 April 2018 Chargeback Guide Chapter 2 Dual Message System Chargebacks Mastercard will incorporate the revised Standards into a future edition of the manual(s). The manual(s) are available on Mastercard Connect via Publications. Revised Standards Transaction Processing Rules Mastercard will revise the Transaction Processing Rules to include these Standards. Additions to the Standards are underlined. Deletions are indicated with a strikethrough. 2017 Mastercard. Proprietary. All rights reserved. 1
Chapter 2 Authorization and Clearing Requirements 2.13 Corrections A correction is a single message authorization request containing a value of 20 in DE 3 (Processing Code), subfield 1 (Cardholder Transaction Type Code) that is used in a Card-present environment following a single message POS Transaction approval to remedy a Merchant or Cardholder error. A correction must be performed as a Card-read Transaction initiated by or on behalf of the Cardholder with either PIN or signature as the Transaction may be completed without a Cardholder verification method. The Acquirer assumes the risk for this message type and the interchange fee is returned to the Acquirer from the Issuer. 3 Acceptance Procedures 3.4 Mastercard Cardholder Verification Requirements In a face-to-face Transaction environment, the Merchant Terminal must support signature as a Cardholder verification method (CVM) for a Mastercard POS Transaction. Unless PIN, Consumer Device CVM (CDCVM), or No CVM is used as the CVM in accordance with the Standards, the Merchant must request that the Cardholder sign the Merchant s copy of the Transaction receipt. For this type of Transaction Contactless Transaction Quick Payment Service (QPS) Transaction If the Transaction amount is less than or equal to the applicable CVM limit, then The Merchant must not request a signature. The Merchant may request a signature, but is not required to do so. For a Mastercard Contactless Transaction that exceeds the applicable contactless CVM limit, a CVM must be used. The CVM may be any of the following, provided both the Card or Access Device and the POS Terminal support the CVM: Signature; or Online PIN; or Consumer Device CVM (CDCVM). 2017 Mastercard. Proprietary. All rights reserved. 2
NOTE: Modifications to this Rule appear in the Canada Region and United States Region sections at the end of this chapter. With respect to Transactions conducted by a Merchant having less than USD 100,000 in annual Transaction Volume and using an MPOS Terminal or a Chiponly MPOS Terminal: 1. If the MPOS Terminal or Chip-only MPOS Terminal does not support electronic signature capture and cannot print a paper Transaction receipt, then signature is not required; and 2. If the MPOS Terminal has a contact chip reader and magnetic stripe-reading capability but does not support PIN as a CVM for Contact Chip Transactions, then PIN is not required. (The use of an MPOS Terminal or Chip-only MPOS Terminal lacking such capabilities confers no chargeback protection.) 3.7 Specific Terms of a Transaction The Merchant may impose specific terms governing a Transaction by, for example: 1. Legible Pprinting of the specific terms on the Transaction receipt in close proximity to the Cardholder signature line before presenting the Transaction receipt to the Cardholder for signature; or 2. Disclosing the specific terms by other means, such as by signage or literature, provided the disclosure is sufficiently prominent and clear so that a reasonable person would be aware of and understand the disclosure before the Transaction is completed. Specific Transaction terms may include, for example, such words as No Refunds, Exchange Only, In-Store Credit Only, or Original Packaging Required for Returns. Specific terms may address such matters as late delivery, delivery charges, or insurance charges. The specific terms printed on the Transaction receipt offered to the Cardholder will govern in the event of a dispute, subject to compliance with other Standards. 3.7.1 Specific Terms of an E-commerce Transaction In an e-commerce Transaction: 1. A Cardholder may accept specific Transaction terms by electronic means (for example, by checking a box or clicking a Submit button indicating the acceptance of terms and conditions); and 2. A Merchant must clearly communicate, and the Cardholder must 2017 Mastercard. Proprietary. All rights reserved. 3
specifically accept, any terms concerning a recurring payment Transaction arrangement separately from any other terms (for example, by checking a box or clicking a Submit button indicating the acceptance of recurring payment terms and conditions). In the event of a non-fraud-related dispute, and subject to compliance with other Standards, such specific terms shall be given effect, The specific Transaction terms will govern in the event of a dispute, subject to compliance with other Standards, provided that such specific terms were disclosed to and accepted by the Cardholder before completion of the Transaction. 3.8 Charges for Loss, Theft, or Damage Mastercard POS Transactions Only A charge for loss, theft, or damage must be processed as a separate Transaction from the underlying rental, lodging, or other Transaction. The Cardholder must authorize the Transaction amount after being informed of the amount and reason for the charge. The Merchant must provide a reasonable estimate of the cost of repairs, and obtain agreement from the Cardholder, prior to processing the Transaction. The Merchant must provide a reason for the charge and a reasonable estimate of the cost of repairs to the Cardholder. After gaining the Cardholder s authorization of the charge and the estimated cost, the Merchant must process the Transaction as one of the following: The Transaction must be A Card-present Transaction, a CVM must be obtained. For CVM requirements, see Rules 3.4., and t A fully authenticated SecureCode or Identity Check e-commerce Transaction The Transaction receipt must include a statement indicating that the estimated amount charged for repairs will be adjusted upon completion of the repairs and submission of the invoice for such repairs. The final amount of a Transaction relating to repairs must not exceed the Merchant s estimated amount. If the Merchant obtains a preauthorization for an estimated amount, and the Transaction amount exceeds the authorized amount, the Merchant may request an additional authorization. In connection with such Transactions, the Issuer must not place a hold on the Cardholder s Account in excess of the authorized amount. 2017 Mastercard. Proprietary. All rights reserved. 4
3.9.1 POS and Mastercard Manual Cash Disbursement Transaction Receipt Requirements All of the following information must be included on a Transaction receipt: 1. The doing business as (DBA) Merchant name, city, state/province, and country, or the financial institution location as provided in DE 43 (Card Acceptor Name/Location). 2. The Transaction type (retail sale, cash disbursement, refund). 3. The primary account number (PAN), in compliance with Rule 3.9.3. When an Access Device is presented, the Transaction receipt must display the PAN (in truncated form) for the Account accessed by means of that Contactless Payment Device, which may differ from the PAN on a Card linked to the same Account. If available, the truncated Card PAN may also be displayed for informational purposes. 4. A description and the price of each product and service purchased or returned, including applicable taxes, in detail sufficient to identify the Transaction. 5. The total Transaction amount and Transaction currency. If no currency is identified on the Transaction receipt, the Transaction is deemed to have taken place in the currency that is legal tender at the POI. 6. The Transaction date. (For Transaction date requirements, see Appendix C.) 7. For Card-present Mastercard POS Transactions completed with a manual imprinter, a legible imprint of the Card (unless the Card is unembossed). 8. The authorization approval code, if obtained from the Issuer. If multiple authorizations are obtained over the course of the Transaction (as may occur for lodging, cruise line, or vehicle rental Transactions), all authorization numbers, the amounts authorized, and the date of each authorization must be included. 9. For a Chip Transaction, the application identifier (AID) and the application preferred name or application label. 10. For face-to-face Mastercard unique Transactions and Mastercard Manual Cash Disbursement Transactions, with the exception of Card-read Transactions where a non-signature CVM is used, a description of the unexpired, official government document provided as identification by the Cardholder, including any serial number, expiration date, jurisdiction of issue, customer name (if not the same name as present on the Card), and customer address. 11. Adequate space for the Cardholder s signature, unless the Transaction is completed with a PIN or Consumer Device CVM (CDCVM) as the CVM or no CVM is used (signature space is required on the Merchant s copy only). The Transaction receipt may optionally indicate that successful PIN or CDCVM verification has occurred. If a receipt is produced following an unsuccessful Transaction attempt, the receipt must indicate the response or failure reason. NOTE: An addition to this Rule appears in the Canada Region, Europe Region and United States Region sections at the end of this chapter. 2017 Mastercard. Proprietary. All rights reserved. 5
Canada Region 3.4 Mastercard Cardholder Verification Requirements In the Canada Region, the Rule on this subject is modified as follows. In a face-to-face Transaction environment, unless PIN, Consumer Device CVM (CDCVM), or No CVM is used as the CVM in accordance with the Standards the Merchant may request that the Cardholder sign the Merchant s copy of the Transaction receipt. For a Mastercard Contactless Transaction that: Is less than or equal to the applicable contactless CVM limit: The Merchant must not request that the Cardholder sign the Merchant s copy of the Transaction receipt Exceeds the applicable contactless CVM limit, the CVM may be any of the following, provided both the Card or Access Device and the POS Terminal support the CVM: - Signature When signature is selected as the CVM, the Merchant may request the Cardholder s signature Online PIN Consumer Device CVM (CDCVM) 3.9.1 POS and Mastercard Manual Cash Disbursement Transaction Receipt Requirements In the Canada Region, the Rule on this subject is modified as follows. Adequate space for the Cardholder s signature may be included on a Transaction receipt, unless the Transaction is completed with a PIN or Consumer Device CVM (CDCVM) as the CVM or no CVM is used (signature space is required on the Merchant s copy only). The Transaction receipt may optionally indicate that successful PIN or CDCVM verification has occurred. United States Region 3.4 Mastercard Cardholder Verification Requirements 2017 Mastercard. Proprietary. All rights reserved. 6
In the United States Region, the Rule on this subject is modified as follows. In a face-to-face Transaction environment, unless PIN, Consumer Device CVM (CDCVM), or No CVM is used as the CVM in accordance with the Standards the Merchant may request that the Cardholder sign the Merchant s copy of the Transaction receipt. For a Mastercard Contactless Transaction that: Is less than or equal to the applicable contactless CVM limit: The Merchant must not request that the Cardholder sign the Merchant s copy of the Transaction receipt Exceeds the applicable contactless CVM limit, the CVM may be any of the following, provided both the Card or Access Device and the POS Terminal support the CVM: - Signature When signature is selected as the CVM, the Merchant may request the Cardholder s signature - Online PIN - Consumer Device CVM (CDCVM) 3.9.1 POS and Mastercard Manual Cash Disbursement Transaction Receipt Requirements In the United States Region, the Rule on this subject is modified as follows. Adequate space for the Cardholder s signature may be included on a Transaction receipt, unless the Transaction is completed with a PIN or Consumer Device CVM (CDCVM) as the CVM or no CVM is used (signature space is required on the Merchant s copy only). The Transaction receipt may optionally indicate that successful PIN or CDCVM verification has occurred. Revised Standards Chargeback Guide Chapter 2 Dual Message System Chargebacks Cardholder Dispute Chargeback Issuer s First Chargeback Credit Not Processed Chargeback Condition. The cardholder contacted the issuer claiming one of the following: 2017 Mastercard. Proprietary. All rights reserved. 7
The merchant failed to disclose its refund policy at the time of the transaction and is unwilling to accept a return or cancellation of goods or services The merchant has not responded to the return or the cancellation of goods or services The merchant posted a credit for a reduced amount without proper disclosure The merchant failed to issue a Value Added Tax (VAT) credit Time Frame. One of the following: The issuer can immediately charge back the transaction upon receiving one of the following forms of credit documentation: A letter from the merchant advising the issuer to obtain credit using a chargeback Proof of an improperly disclosed in-store credit A TID voided by the merchant 120 calendar days from the day the service was canceled or the goods were returned. When the credit documentation is dated, the 120-day chargeback time frame counts the date on the credit documentation as day zero. When the credit documentation is undated, the 120-day time frame counts the date on the cardholder letter, email, message, or Dispute Resolution Form Cardholder Dispute Chargeback (Form 1221) as day zero. When the cardholder letter is undated, the chargeback time frame counts the receipt date of the documentation by the issuer as day zero. 120 calendar days from the transaction date for a VAT credit The issuer must wait 15 calendar days from one of the following: The date on the credit documentation The date goods were returned The date services were canceled When waiting the 15 calendar days would cause the issuer to exceed the 120 calendar day time frame, the issuer may chargeback the transaction earlier than 15 calendar days. Message Reason Code. One of the following: 4853 Dual Message System transactions 53 for Debit Mastercard transactions processed on the Single Message System The following message reason codes may continue to be used, however, they will eventually be eliminated: 4860 (Credit Not Processed) for Dual Message System transactions 2017 Mastercard. Proprietary. All rights reserved. 8
60 (Credit Not Processed) for Debit Mastercard transactions processed on the Single Message System Supporting Documents. A cardholder letter, email, message, or Dispute Resolution Form Cardholder Dispute Chargeback (Form 1221) describing the cardholder s complaint in sufficient detail to enable all parties to understand the dispute. A cardholder letter, email, message, or Dispute Resolution Form Cardholder Dispute Chargeback (Form 1221) is not required when the documentation includes a TID voided by the merchant or other merchant documentation to support a credit is due to the cardholder. DE 72 (Data Record). For improperly disclosed partial credit only: NNNNNNNNNNNNNNNNNNNNNNN Notes Replace NNNNNNNNNNNNNNNNNNNNNNN with the Acquirer Reference Data (ARD) of the credit transaction. Proper Disclosure Merchants that are unwilling to accept buyer s remorse returns and cancellations or that want to have special terms including (but not limited to) restocking fees or in-store credits, must disclose these terms at the time of the transaction. The cardholder must be informed of the refund policy prior to completion of the transaction at the point of interaction as described in the Transaction Processing Rules, section 3.7 Specific Terms of Transaction. Failure to disclose a refund policy will result in the merchant s requirement to accept the goods for return and issue a credit. When the merchant informed the cardholder of its refund policy at the time of purchase, the cardholder must abide by that policy. For example, the cardholder s sales slip clearly indicates that the refund policy is in-store credit only or no refunds. Addendum Dispute An addendum dispute is the dispute of a separate transaction that occurs after a valid transaction involving the same merchant and the same cardholder. Chargeback Condition. The cardholder contacted the issuer claiming all of the following: The cardholder engaged in a valid transaction with the merchant. A subsequent transaction occurred with that same merchant without the cardholder s consent. The cardholder contacted the merchant, or attempted to contact the merchant, to resolve the dispute. Merchant contact is optional when the cardholder is a corporate entity with a 2017 Mastercard. Proprietary. All rights reserved. 9
contractual relationship with the merchant and the transaction is for an amount in excess of what is specified in the contract. In such event the chargeback may be only for the amount of the excessive charge. Time Frame. 120 calendar days of the Central Site Business Date of the disputed subsequent transaction. Message Reason Code. One of the following: 4853 Dual Message System transactions 53 for Debit Mastercard transactions processed on the Single Message System The following message reason codes may continue to be used, however, they will eventually be eliminated: 4859 (Addendum, No-show, or ATM Dispute) for Dual Message System transactions 59 (Services Not Rendered) for Debit Mastercard transactions processed on the Single Message System Supporting Documents. A cardholder letter, email, message, or completed Dispute Resolution Form Cardholder Dispute Chargeback (Form 1221) describing the cardholder s complaint in sufficient detail to enable all parties to understand the dispute. In addition, the contract must be provided when the cardholder is a corporate entity with a contractual relationship with the merchant and the transaction is for an amount in excess of what is specified in the contract. DE 72 (Data Record). None Notes The right to charge back the disputed amount is not dependent on the method of payment for the original transaction. For example, the cardholder may have paid cash for the accepted transaction, but the disputed subsequent transaction was applied to the Mastercard card because the cardholder presented the Mastercard card to the merchant to guarantee the service. A cardholder is not responsible for a charge representing loss, theft, or damage unless the cardholder agreed to be billed after being informed of such charges the transaction was completed as described in the Transaction Processing Rules, section 3.8 Charges for Loss, Theft, or Damage. Cardholders are responsible for valid addendum charges. Examples include, but are not limited to: meals that were signed for by the cardholder but not included in the final hotel folio or for parking tickets/traffic fines issued while the vehicle was in the cardholder s possession. 2017 Mastercard. Proprietary. All rights reserved. 1
Acquirer s Second Presentment General Second Presentment Second Presentment Condition. The acquirer can provide evidence in response to the cardholder s claims. Time Frame. Within 45 calendar days of the chargeback settlement date. IPM Second Presentment Message Reason Code. 2700 (See Corresponding Documentation/Chargeback Remedied). Supporting Documents. The merchant s explanation and documentation. When the Second Presentment is in response to a First Chargeback for Credit Not Processed, the acquirer must provide documentation that proper disclosure was made in accordance with the Transaction Processing Rules, section 3.7 Specific Terms of a Transaction. When the Second Presentment is in response to a First Chargeback for an Addendum Dispute for loss, theft, or damage the acquirer must provide proof of card presence and CVM for the separate transaction representing loss, theft, or damage the transaction was completed as described in the Transaction Processing Rules, section 3.8 Charges for Loss, Theft, or Damage. DE 72 (Data Record). None Notes. A merchant or acquirer statement that the cardholder never contacted the merchant to cancel the recurring transaction is not a valid second presentment. Fraud-related Chargebacks No Cardholder Authorization Acquirer s Second Presentment Acquirer Identified Addendum Charges Second Presentment Condition. The acquirer can substantiate that the addendum transaction is the cardholder s responsibility. IPM Second Presentment Message Reason Code. 2700 (See Corresponding Documentation/ Chargeback Remedied) Time Frame. Within 45 calendar days of the chargeback settlement date. Supporting Documents. Documentation substantiating the cardholder has participated in the original transaction and documentation to establish the cardholder is responsible for the addendum transaction. When the disputed amount presents charges for loss, theft, or damage: Documentation substantiating the transaction was completed as described in the Transaction Processing Rules, section 3.8 Charges for Loss, Theft, or 2017 Mastercard. Proprietary. All rights reserved. 1
Damage. DE 72 (Data Record). None Notes The acquirer also must include documentation substantiating that the cardholder is responsible for the disputed amount when the amount represents final audit charges not included in the original hotel/motel or vehicle cardholder billing. For example, after the cardholder initially is billed for a vehicle rental, the cardholder is billed for a separate additional amount that represents unpaid parking tickets. The cardholder claims that he or she did not authorize the transaction for the parking tickets. The merchant should include, with the second presentment, information about the violations showing that they were issued during the period that the vehicle was rented by the cardholder, as well as the rental agreement with proof the cardholder participated in the original transaction of card presence and signature authorizing such charges. Chip Liability Shift Second Presentment Condition. All of the following: 1. The transaction was between Customers that participate in the appropriate Chip Liability Shift Program. 2. The transaction was face-to-face, occurred at an attended hybrid terminal with card-read (not key-entered) account information. 3. The transaction was initiated with a non-emv chip card. This is a final remedy. IPM Second Presentment Message Reason Code. 2870 (Chip Liability Shift) Time Frame. Within 45 calendar days of the chargeback settlement date. Supporting Documents. None One of the following: 1. Documentation to substantiate card presence and PIN or signature as a cardholder verification method (CVM) and which includes a card imprint matching the account number in the First Chargeback/1442 message and cardholder signature or evidence of other valid cardholder verification method (CVM) authorizing the use of the Mastercard account number to settle the account. 2. None when the issuer provided a cardholder letter with the chargeback for a signature-based transaction that obtained an authorization using the Mastercard Network and that occurred at an attended hybrid terminal that read and transmitted the account number from the card s magnetic stripe. 3. None when the issuer provided a Dispute Resolution Form-Fraud (Form 2017 Mastercard. Proprietary. All rights reserved. 1
0412) form with the chargeback for a transaction that obtained an authorization using the Mastercard Network and that occurred at an attended hybrid terminal that read and transmitted the account number from the card s magnetic stripe. DE 72 (Data Record). One of the following corresponding to the Supporting Documents: 1. None 2. AUTH MMDDYY NNNNNN 3. AUTH MMDDYY NNNNNN Notes Replace MMDDYY with the date the transaction was authorized. Replace NNNNNN with the authorization approval code. This remedy does not apply to intraregional contactless transactions occurring in the Canada region. Issuer s Arbitration Chargeback Addendum Disputes Arbitration Chargeback Condition. One of the following: When tthe original transaction was fraudulent: and tthe acquirer did not provide proof of card presence for the original transaction and the original signed rental agreement or hotel folio. When tthe charge is for loss, theft, or damages: and tthe acquirer failed to provide proof of card presence and signature or other cardholder verification method (CVM) specific to the transaction for loss, theft, or damages. the transaction was completed as described in the Transaction Processing Rules, section 3.8 Charges for Loss, Theft, or Damage IPM Arbitration Chargeback Message Reason Code. 4837 (No cardholder authorization) Time Frame. Within 45 calendar days of the second presentment settlement date. Supporting Documents. When the original transaction was fraudulent and the acquirer failed to provide proof of card presence and signature or other CVM: A new cardholder letter, completed Dispute Resolution Form-Fraud (Form 0412), email, or message dated after the second presentment and specifically including both of the following: Addresses the merchant s explanation Identifies that the original transaction also was fraudulent For charges of loss, theft, or damages where the acquirer failed to provide 2017 Mastercard. Proprietary. All rights reserved. 1
proof of card presence and signature, or other cardholder verification method (CVM): None DE 72 (Data Record). None Notes. When, as a result of information provided in the second presentment, the issuer learns that the disputed transaction is an Addendum Transaction involving the same merchant, the issuer must change the message reason code to 4853-Cardholder Dispute Chargeback, Addendum Dispute. Invalid Proof of Card Presence and Signature Arbitration Chargeback Condition. The issuer determines that the acquirer did not provide documentation substantiating the card s presence and providing a cardholder s signature. IPM Arbitration Chargeback Message Reason Code. 4837 (No cardholder authorization) Time Frame. Within 45 calendar days of the second presentment settlement date Supporting Documents. None DE 72 (Data Record). None Notes Issuers may not use 4837 when the authorization for the disputed transactions occurred at an attended terminal where the card data was cardread. When the account number(s) appearing on the TID does not match the electronic record, then the chargeback may continue without a new cardholder letter, email, or message. The issuer does not have the right to process an arbitration chargeback for lack of signature when the transaction involved a properly processed vehicleassigned Mastercard Corporate Fleet Card transaction. Fraudulent Processing of Transactions Acquirer s Second Presentment Addendum Transaction Second Presentment Condition. The acquirer can substantiate that the addendum transaction is the cardholder s responsibility. IPM Second Presentment Message Reason Code. 2700 (See Corresponding Documentation/Chargeback Remedied) Time Frame. Within 45 calendar days of the chargeback settlement date. 2017 Mastercard. Proprietary. All rights reserved. 1
Supporting Documents. Documentation substantiating the cardholder participated in the original transaction and documentation to establish the cardholder is responsible for the addendum transaction. Suggested documentation is proof of card presence and signature for the original transaction as well as documentation to support that the addendum transaction is the cardholder s responsibility. DE 72 (Data Record). None Notes. None Cardholder Does Not Recognize Acquirer s Second Presentment Conflicting Information in Authorization and Clearing Messages Second Presentment Condition. Both of the following: The authorization and clearing messages conflict on identifying the transaction as non-face-to-face or face-to-face The transaction was face-to-face Time Frame Within 45 calendar days of the chargeback settlement date IPM Second Presentment Message Reason Code. 2713 (Invalid chargeback) Supporting Documents. Proof of card presence and, when applicable, cardholder signature or PIN. DE 72 (Data Record). None Notes. None Chip Liability Shift Lost/Stolen/Never Received Issue (NRI) Fraud Term PIN-capable hybrid POS terminal Definition When located in the Asia/Pacific, Canada, Europe, Latin America and the Caribbean, or Middle East/Africa region A hybrid POS terminal that is capable at a minimum of performing offline PIN verification when a PIN-preferring chip card is presented. It also may be capable of online PIN verification and, when attended, must accept support signature. When located in the United States region A hybrid POS terminal capable of performing both online and offline PIN verification when a PIN-preferring chip card is presented and which, when attended, also accepts support signature. A PIN-capable hybrid POS terminal is indicated when DE 2017 Mastercard. Proprietary. All rights reserved. 1
22, subfield 2 (Terminal Data: Cardholder Authentication Capability), of the First Presentment/1240 message contains a value of 1. The issuer may not use this message reason code under the following conditions. A properly identified contactless transaction occurred and: The transaction amount was equal to or less than the CVM limit (found in Appendix C); or The transaction amount exceeded the CVM limit and was completed with online PIN or successful on-device cardholder verification; or The validly issued card or access device was issued with magstripe mode-only contactless functionality and did not support on-device cardholder verification, the transaction amount exceeded the CVM limit, and the transaction was completed with signature was selected as the CVM. 2017 Mastercard. Proprietary. All rights reserved. 1