Caribbean Cinemas ‘Partially’ Complies with Law to Accept Debit, Credit Cards
SAN JUAN – It has been more than two weeks since the passing of a law requiring businesses with an annual income exceeding $50,000 to have two payment methods available, and one of them must be a credit or debit card. Caribbean Cinemas still does not have point of sales (POS) terminals at more than half of its 31 theaters across the island.
Caribbean Cinemas’ marketing director, Mayra Ramírez, said the company has been discussing the matter with the Consumer Affairs Department (DACO by its Spanish acronym) since June 15. The company has also requested extensions from the government agency, even though the latter cannot issue administrative fines since the joint regulation with the Treasury Department has yet to be approved.
“We clearly informed them we were negotiating with suppliers regarding the cost of installing said equipment, [and] considering the debit method we would use as a second payment alternative,” said Ramírez, who estimated Caribbean Cinemas would have to invest $500,000 a year to install the equipment and train its employees.
When asked by Caribbean Business about the company’s ability to afford these expenses, considering it has some 13 million visitors a year, Ramírez pointed out that any expenses beyond regular operational costs must be questioned.
“Any expense or cost beyond that which is basic, such as electricity and water—which we also know will see rate increases—will obviously, yes (it is questionable). Everything that involves an expenditure or an additional cost for any business on the island definitely does have an impact,” Ramírez said, while ruling out the company’s willingness to accept credit card transactions outside the Cinema Express system in the near future, since customers already have that option via the Internet.
“We know POS machines’ cost is quite onerous. In other words, it is the cost of the machine and the cost of processing each transaction. Credit costs are very high. The reason behind not accepting credit cards at this time is cost,” the executive said.
Since June 15, the company has placed notices at theater entryways saying they do not have debit-card processing methods, along with an explanation of the status of the POS terminal installation. This information has generated discontent among some customers via social media.
Fifteen theaters currently have POS terminals. Theaters ready to process debit cards include those in Montehiedra, Cayey, Santa Isabel, Guaynabo, Dorado, Hatillo, Metro, Las Catalinas Mall in Caguas, Fajardo, Guayama, Los Colobos in Carolina, Plaza Las Américas, Río Hondo 1, San Patricio and both Fine Arts locations. According to an installation schedule, six more locations will be added to the list of theaters in compliance with the law.
“They [DACO] are clear that as long as the regulation does not get final approval, they cannot issue fines. Instead, inspectors’ visits would offer guidance and cautionary notes, which has been the case,” said Ramírez, who took the opportunity to reply to the ultimatum that the legislation’s author, Sen. Luis Daniel Rivera Filomeno (PDP-Carolina), issued on radio station about their intention—in a week’s time—to accompany the police to file a complaint and therefore activate the process to issue a fine contained in the law.
“On June 20, I personally spoke to the senator, who went to El Escorial cinema with a Telemundo camera crew, and I explained that we were in communication with DACO, telling them at what stage of the process we currently find ourselves. He understood; at least what he replied is he understood we had many locations and it was a process that required installation, that employees be trained, etc. This [past] week…I contacted inspector Serrano and sent—in writing—our commitment to be ready July 8,” the marketing director said.
Awaiting regulations and public hearings
In terms of the bill’s legislative intent, Ramírez said Caribbean Cinemas has serious doubts about its language and application.
“At the appropriate time, as soon as the regulations come out, DACO will let us know about the public hearings to see how that language or wording affects us, and then ask questions and discuss how these regulations can affect us,” the executive pointed out, specifically mentioning other electronic payment options not covered by the new law.
“Overall, we have several questions, but I would rather not get into that now; however, for example, in terms of electronic payments, there are many methods. They mention credit and debit cards but alternatives like PayPal, ATH Móvil, etc. It has not been defined if they apply or not,” Ramírez concluded.