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Can I accept payments online without violating payment processing laws in Oregon? What are the requirements?

To accept payments online in Oregon, you must comply with the Oregon Uniform Commercial Code (UCC) Article 4A, which governs funds transfers.

Requirements for accepting payments online in Oregon

To accept payments online without violating payment processing laws in Oregon, you must comply with the following requirements:

  1. Authorization: A payment order received by the receiving bank is the authorized order of the person identified as the sender if that person authorized the order or is otherwise bound by it under the law of agency [ORRS 74A.2020(1)].
  2. Security procedure: If a bank and its customer have agreed that the authenticity of payment orders issued to the bank in the name of the customer as sender will be verified pursuant to a security procedure, a payment order received by the receiving bank is effective as the order of the customer, whether or not authorized, if the security procedure is a commercially reasonable method of providing security against unauthorized payment orders [ORRS 74A.2020(2)].
  3. Commercial reasonableness: Commercial reasonableness of a security procedure is a question of law to be determined by considering the wishes of the customer expressed to the bank, the circumstances of the customer known to the bank, including the size, type, and frequency of payment orders normally issued by the customer to the bank, alternative security procedures offered to the customer, and security procedures in general use by customers and receiving banks similarly situated [ORRS 74A.2020(4)].
  4. Refund: If a receiving bank accepts a payment order issued in the name of its customer as sender which is not authorized and not effective as the order of the customer under ORS 74A.2020 or not enforceable, in whole or in part, against the customer under ORS 74A.2030, the bank shall refund any payment of the payment order received from the customer to the extent the bank is not entitled to enforce payment [ORRS 74A.2040(1)].

Conclusion

To accept payments online in Oregon, you must comply with the authorization, security procedure, commercial reasonableness, and refund requirements outlined in the Oregon Uniform Commercial Code (UCC) Article 4A [2.1][2.4][2.6][2.8].

Source(s):
Jurisdiction

Oregon