Mastercard SPME §9.4.2 · Jun 2022 → May 2023

Non–face-to-face Gambling Merchants

substantive

The updated rules require Acquirers to obtain and submit a legal opinion to Mastercard confirming that both the merchant and their cardholders comply with all applicable gambling laws, rather than just keeping information current. This legal opinion must be acceptable to Mastercard.

Sources Mastercard SPME · Jun 2022 · page 92 PDF Mastercard SPME · May 2023 · page 100 PDF KYB Acquirer current

Also in §9.x this release breaking §9.2.1 Merchant Registration Fees and Noncompliance Assessments breaking §9.4.1 Non-face-to-face Adult Content and Services Merchants substantive §9.3 General Monitoring Requirements substantive §9.4.3 Pharmaceutical and Tobacco Product Merchants substantive §9.4.6 High-Risk Cyberlocker Merchants substantive §9.4.7 Recreational Cannabis Merchants (Canada Region Only)

Why these edits? The update shifts the Acquirer's obligation from merely keeping information current to obtaining and submitting a legal opinion to Mastercard confirming compliance with all relevant gambling laws by both the merchant and cardholders; this material change affects the Acquirer KYB policy's legal compliance requirements.

Mastercard SPME §9.4.2

This section was substantively restructured between versions (18% text overlap). Compare the texts directly below.

Before · Jun 2022 · page 92

Security Rules and Procedures—Merchant Edition • 22 February 2022

information current and complete. Such notification is required within ten (10) days of any such change.

After · May 2023 · page 100

Security Rules and Procedures—Merchant Edition • 7 February 2023

– identify all relevant gambling, gaming, and similar laws applicable to the Merchant; – identify all relevant gambling, gaming, and similar laws applicable to Cardholders permitted by the Merchant to transact with the Merchant; and – demonstrate that the Merchant’s and Cardholders’ gambling and payment activities comply at all times with any laws identified above. The Acquirer must provide Mastercard with a copy of such legal opinion. The legal opinion must be acceptable to Mastercard.

Halyard Pay · 2 files

KYB Acquirer · rules.yaml

program: Acquirer KYB
- authority: Mastercard SPME §2.1
+ authority: Mastercard SPME §2.1, §9.4.2
required_documents:
  - incorporation
  - beneficial_ownership
  - aml_screen
  - license_verification
+   - legal_opinion_gambling_compliance
min_review_cycle_days: 365
suspension_trigger: document_collection_failure
record_retention_years: 7
aml_watchlist_sources:
  - ofac_sdn
  - eu_consolidated
agent_owner: kyb_agent
+ 
+ # Added requirement for a legal opinion document regarding gambling law compliance per Mastercard SPME §9.4.2
+ # Updated authority field to reference new section.

KYB Acquirer · policy.md

Acquirer KYB (Know Your Business) Obligations

Acquirers processing transactions on the Mastercard network are required to perform

Know Your Business (KYB) due diligence on merchants before onboarding and on a

recurring basis thereafter. Halyard Pay, as an acquirer, must collect and verify a

minimum set of documents for each merchant to establish business legitimacy, confirm

beneficial ownership, and satisfy anti-money laundering screening requirements.

When this policy applies

This policy applies to all new merchant onboarding and to all periodic re-verification

reviews. Merchants that fail to supply required documentation within the stipulated

period must be suspended from processing until compliance is restored.

Required actions

Collect all required KYB documents at onboarding prior to approval.
Conduct AML screening against applicable watchlists before approval.
Verify business licenses for regulated merchant categories.
For merchants involved in gambling, gaming, or similar activities, obtain and submit a legal opinion acceptable to Mastercard that:

- Identifies all relevant gambling, gaming, and related laws applicable to the Merchant;

- Identifies all relevant laws applicable to Cardholders permitted by the Merchant to transact;

- Demonstrates that both the Merchant's and Cardholders' activities comply with those laws.

5. Schedule a full re-verification review at least once every 365 days.

5. 6. Document all verification outcomes and retain records for audit purposes.

Source authority: Mastercard SPME ~~§2.1.~~§2.1, §9.4.2.

policies/kyb_acquirer/policy.md — after applying change

Acquirer KYB (Know Your Business) Obligations

Acquirers processing transactions on the Mastercard network are required to perform

Know Your Business (KYB) due diligence on merchants before onboarding and on a

recurring basis thereafter. Halyard Pay, as an acquirer, must collect and verify a

minimum set of documents for each merchant to establish business legitimacy, confirm

beneficial ownership, and satisfy anti-money laundering screening requirements.

When this policy applies

This policy applies to all new merchant onboarding and to all periodic re-verification

reviews. Merchants that fail to supply required documentation within the stipulated

period must be suspended from processing until compliance is restored.

Required actions

Collect all required KYB documents at onboarding prior to approval.
Conduct AML screening against applicable watchlists before approval.
Verify business licenses for regulated merchant categories.
For merchants involved in gambling, gaming, or similar activities, obtain and submit a legal opinion acceptable to Mastercard that:

- Identifies all relevant gambling, gaming, and related laws applicable to the Merchant;

- Identifies all relevant laws applicable to Cardholders permitted by the Merchant to transact;

- Demonstrates that both the Merchant's and Cardholders' activities comply with those laws.

5. Schedule a full re-verification review at least once every 365 days.

5. 6. Document all verification outcomes and retain records for audit purposes.

Source authority: Mastercard SPME ~~§2.1.~~§2.1, §9.4.2.

Source authority: Mastercard SPME §9.4.2.

--- a/policies/kyb_acquirer/rules.yaml
+++ b/policies/kyb_acquirer/rules.yaml
@@ -1,10 +1,11 @@
 program: Acquirer KYB
-authority: Mastercard SPME §2.1
+authority: Mastercard SPME §2.1, §9.4.2
 required_documents:
   - incorporation
   - beneficial_ownership
   - aml_screen
   - license_verification
+  - legal_opinion_gambling_compliance
 min_review_cycle_days: 365
 suspension_trigger: document_collection_failure
 record_retention_years: 7
@@ -12,3 +13,6 @@
   - ofac_sdn
   - eu_consolidated
 agent_owner: kyb_agent
+
+# Added requirement for a legal opinion document regarding gambling law compliance per Mastercard SPME §9.4.2
+# Updated authority field to reference new section.
--- a/policies/kyb_acquirer/policy.md
+++ b/policies/kyb_acquirer/policy.md
@@ -17,7 +17,11 @@
 1. Collect all required KYB documents at onboarding prior to approval.
 2. Conduct AML screening against applicable watchlists before approval.
 3. Verify business licenses for regulated merchant categories.
-4. Schedule a full re-verification review at least once every 365 days.
-5. Document all verification outcomes and retain records for audit purposes.
+4. For merchants involved in gambling, gaming, or similar activities, obtain and submit a legal opinion acceptable to Mastercard that:
+   - Identifies all relevant gambling, gaming, and related laws applicable to the Merchant;
+   - Identifies all relevant laws applicable to Cardholders permitted by the Merchant to transact;
+   - Demonstrates that both the Merchant's and Cardholders' activities comply with those laws.
+5. Schedule a full re-verification review at least once every 365 days.
+6. Document all verification outcomes and retain records for audit purposes.
 
-Source authority: Mastercard SPME §2.1.
+Source authority: Mastercard SPME §2.1, §9.4.2.