Prior to October 2015, card-present counterfeit fraud liability resided with credit card issuers. In October 2015, when the EMV liability shift took effect, liability shifted to the party that had not enabled chip – the merchant or card issuer. In some cases, merchants have been unable to implement EMV terminals due to EMV software certification delays and are bearing the cost of counterfeit fraud while they wait. As a result, both Visa and American Express (as of 06/28/2016) have extended temporary modifications to the EMV liability shift. It’s possible that other payment card brands may follow suit with similar EMV related chargeback modifications in the near future.
The current updates will help alleviate the effect of the liability shift on merchants that have yet to enable EMV acceptance as follows:
Although American Express has yet to release specific operating details, Visa has indicated that their modifications will be enforced primarily through system blocks which will preclude card issuers from sending chargebacks fitting these parameters.