Contract & Document Review

Make smart contract document decisions with merchant processing agreement review.

When creating a contract, it can be tempting to pull up a form online and just fill in the blanks. It’s easy to assume the merchant service provider has all of your bases covered in your new merchant account contracts. They might, but they might not. That’s where our attorneys come in. Global Legal Law Firm recommends that any contract between merchants and their merchant service provider be reviewed, if not drafted, by one of our talented attorneys.

Whether we’re reviewing tripartite merchant processing agreements, Pay-Fac agreements, sub-merchant agreements, ISO agreements, or something else, our attorneys are trained to keep a close eye on the details.

Guidance for all areas of Contract
& Document Review

Residuals and Termination

The merchant services agreement will typically describe how much of a residual the sales agent will collect from the ISO in equipment fees, business sales, and other sources.

Fees and taxes are often specified by the laws of the state or jurisdiction where the business is located, or they may be capped at a certain amount, so astute business owners will look to their attorneys and accountants for guidance. Residuals also require termination clauses as well as percentages, and because of the tricky nature of percentage contracts and residuals on fees, we strongly encourage everyone to have their contracts reviewed before signing.

Revenue and Ownership

The merchant account agreement should include a clause describing what revenue is shared with the ISO. Ideally, the ISO should share in all revenue.

This prevents them from raising prices on a merchant with whom they don’t share revenue. A contract review will catch this type of maneuver, which is often hidden in the fine print and benefits the ISO at the expense of the merchant. Who owns the equipment, such as a credit card scanner, after the contract is up, needs to be specified as well. These are the things your attorney will know to ask when reviewing the contract.

Jurisdiction

Merchant services agreements always spell out where the contract will be litigated if it is contested. This can be important for several reasons. Travel and favorability of the merchant’s home state should be considered, as well as the state’s position on business law and tax laws.

Your attorney should also look for – or will include or exclude when drafting – a clause regarding arbitration. Many companies such as Visa now require mandatory binding arbitration instead of a jury trial in legal disputes. Such a clause may be included in boilerplate contracts, and a good attorney should ask if such a clause can be waived. ‌These aren’t the types of considerations the average business is likely to watch for in a contract, but our lawyers’ expertise keeps us on the watch.

Revenue Clauses

Regardless of your type of contract, an ISO agreement will include clauses about what revenue they share in or collect residuals from. For your financial interests, you’ll want to check the fine print to ensure that the ISO shares in all revenue, whether it’s a flat fee or percentage.

Otherwise, an ISO can raise their prices on a merchant they don’t share revenue with. Even a basic contract review will ensure that payment terms are fair and understood

Contract and Document Review at Global Legal Law Firm

The little details can change merchant services agreements from simple payment processing contracts to burdens. A thorough review by one of the attorneys at Global Legal can catch details buried in the fine print. Global Legal has assisted numerous ISOs in their litigation and contract needs, with experience in processor agreements from North American Bankcard, TSYS, Elavon, Heartland, and more. Schedule a consultation to learn how our decades of litigation skills can help you with your merchant processing review.

Work With Us Today

Our talented team of experienced lawyers can guide you through all facets of your electronic payment processing business to lead you to the other side stronger than before.