Halyard Pay · Policy Updates Powered by Carver Agents

Mastercard SPME §9.4.7 · Jun 2022 → May 2023

Recreational Cannabis Merchants (Canada Region Only)

substantive

The updated section introduces new requirements for acquirers managing recreational cannabis merchants in Canada. Acquirers must obtain and retain provincial retail licenses, promptly provide documentation to Mastercard upon request, notify Mastercard within 10 business days of any license changes, and cease Mastercard payments acceptance if a merchant loses licensing.

Sources Mastercard SPME · Jun 2022 · page 103 PDF Mastercard SPME · May 2023 · page 112 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 §9.4.2 Non–face-to-face Gambling Merchants substantive §9.4.3 Pharmaceutical and Tobacco Product Merchants substantive §9.4.6 High-Risk Cyberlocker Merchants
Why these edits? The updated section 9.4.7 introduces specific Know Your Business (KYB) obligations for acquirers managing recreational cannabis merchants in Canada, including obtaining and retaining provincial retail licenses and promptly providing documentation to Mastercard upon request.
Mastercard SPME §9.4.7
This section was substantively restructured between versions (12% text overlap). Compare the texts directly below.
Before · Jun 2022 · page 103

Security Rules and Procedures—Merchant Edition • 22 February 2022

To register a Merchant, Submerchant, or other entity, the Acquirer must demonstrate that an adequate due diligence review was conducted by providing the following items to Mastercard upon request as part of the registration process (herein, all references to a Merchant also apply to a Submerchant or other entity):

After · May 2023 · page 112

Security Rules and Procedures—Merchant Edition • 7 February 2023

Merchant whose primary business is not the sale of recreational cannabis, the MCC of the Merchant’s or Sponsored Merchant’s primary business must be used); and

  • Obtain and retain from the Merchant or Sponsored Merchant or a Canadian provincial licensing authority a copy of the provincial retail license permitting the Merchant or Sponsored Merchant to sell cannabis for recreational purposes. The Acquirer must furnish Mastercard with a copy of such documentation promptly upon request.
  • Notify Mastercard in writing of any change to the information that the Acquirer provided to Mastercard as part of the registration process, including any change in the Merchant’s or Sponsored Merchant’s provincial retail license. Such notification is required within ten (10) business days of any such change. In the event that a recreational cannabis Merchant or Sponsored Merchant loses its licensed status, the Acquirer must stop the Merchant or Sponsored Merchant from accepting Mastercard-branded payments products for recreational cannabis sales and promptly advise Mastercard in writing of such action.
Halyard Pay · 2 files
program: Acquirer KYB


- authority: Mastercard SPME §2.1


+ authority: Mastercard SPME 9.4.7


required_documents:


  - incorporation


  - beneficial_ownership


  - aml_screen


  - license_verification


+   - provincial_recreational_cannabis_license


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 requirements for acquirers managing Canadian recreational cannabis merchants:


+ # obtaining and retaining copies of provincial retail licenses,


+ # furnishing documentation promptly to Mastercard upon request,


+ # and notifying Mastercard within 10 business days of any changes or loss of license,


+ # with mandatory suspension of Mastercard payment acceptance upon license loss per SPME §9.4.7.

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

  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. For Merchants or Sponsored Merchants in Canada whose primary business involves recreational cannabis sales, obtain and retain a copy of their provincial retail license permitting such sales.

5. Furnish Mastercard with copies of requested documentation related to licensing promptly upon request.

6. Notify Mastercard in writing within ten business days of any changes to the merchant’s registration information, including changes to the provincial retail license.

7. If a recreational cannabis merchant loses licensed status, immediately stop the merchant from accepting Mastercard payments for recreational cannabis and notify Mastercard in writing.

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

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

Source authority: Mastercard SPME §2.1.����2.1, 9.4.7.

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

  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. For Merchants or Sponsored Merchants in Canada whose primary business involves recreational cannabis sales, obtain and retain a copy of their provincial retail license permitting such sales.

5. Furnish Mastercard with copies of requested documentation related to licensing promptly upon request.

6. Notify Mastercard in writing within ten business days of any changes to the merchant’s registration information, including changes to the provincial retail license.

7. If a recreational cannabis merchant loses licensed status, immediately stop the merchant from accepting Mastercard payments for recreational cannabis and notify Mastercard in writing.

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

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

Source authority: Mastercard SPME §2.1.����2.1, 9.4.7.

Source authority: Mastercard SPME §9.4.7.

--- 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 9.4.7
 required_documents:
   - incorporation
   - beneficial_ownership
   - aml_screen
   - license_verification
+  - provincial_recreational_cannabis_license
 min_review_cycle_days: 365
 suspension_trigger: document_collection_failure
 record_retention_years: 7
@@ -12,3 +13,9 @@
   - ofac_sdn
   - eu_consolidated
 agent_owner: kyb_agent
+
+# Added requirements for acquirers managing Canadian recreational cannabis merchants:
+# obtaining and retaining copies of provincial retail licenses,
+# furnishing documentation promptly to Mastercard upon request,
+# and notifying Mastercard within 10 business days of any changes or loss of license,
+# with mandatory suspension of Mastercard payment acceptance upon license loss per SPME §9.4.7.
--- 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 or Sponsored Merchants in Canada whose primary business involves recreational cannabis sales, obtain and retain a copy of their provincial retail license permitting such sales.
+5. Furnish Mastercard with copies of requested documentation related to licensing promptly upon request.
+6. Notify Mastercard in writing within ten business days of any changes to the merchant’s registration information, including changes to the provincial retail license.
+7. If a recreational cannabis merchant loses licensed status, immediately stop the merchant from accepting Mastercard payments for recreational cannabis and notify Mastercard in writing.
+8. Schedule a full re-verification review at least once every 365 days.
+9. Document all verification outcomes and retain records for audit purposes.
 
-Source authority: Mastercard SPME §2.1.
+Source authority: Mastercard SPME 2.1, 9.4.7.