Philadelphia Bans Cashless Stores In Growing Legislative Trend That Bucks Technological Advances

Fox Rothschild LLP

Fox Rothschild LLP

The legislative flavor of the month is the movement to outlaw cashless stores. While retailers continue to pursue the holy grail of eliminating the check-out experience altogether with cashier-free stores, states and localities are on the path to prohibit this model by mandating that retailers accept cash payments.

Is this an affront to progress? Or a legitimate effort to protect the 14 million Americans without any bank account who are predominantly poor, elderly and immigrants?

In Philadelphia, the new law is set to go into effect on July 1, 2019 with each violation exposing a brick and mortar retailer to a fine of up to $2,000 (presumably payable in cash).

Of course, there are some exceptions: parking lots and garages; wholesale clubs (e.g. BJ’s and Costco); stores that exclusively sell using a “mobile device application” through a “membership model” (will Amazon Go stores qualify?); certain rentals where “collateral or security is typically required;” and sales exclusively to employees on an employee’s premises. None of these terms are defined and don’t hold your breath until regulations are promulgated.

No one seemed to notice that the Commonwealth of Pennsylvania passed a similar law in 1984 designed to protect consumers paying with cash. The “Cash Consumer Protection Act” made it illegal for businesses “to refuse to rent or sell property or services” to consumers who don’t have credit cards. But this law was apparently enforced only once – against a rental car company, a business that is exempted from the Philadelphia law.

New Jersey has passed similar legislation (which is on the proverbial governor’s desk), and four major cities are chomping at the bit to jump on this bandwagon: Chicago, New York City, San Francisco and Washington, DC.

Is it time to bring back the laws requiring that the price be affixed to each retail item being sold?

[View source.]

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Fox Rothschild LLP

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