Page 41 - GS200301

Education

Data management Fees for services

Parties should endeavor to create various categories of With the benefit of payfac sponsorship and other creative
data. Some data will be for use only by the ISO and its models, ISOs can partner with VARs to implement pricing
acquirer; other data is likely to be used by only the VAR. that bundles the two entities' respective services. Again,
That said, there will be instances where large amounts the parties should prepare for a scenario where one or the
of data will be important for both the ISO and the VAR. other is substituted for a new supplier.
Parties should not shy away from these complex data
management and title relationships. They should, instead, ISOs are usually prohibited by their processors from re-
make an effort to define them clearly in their contracts so soliciting merchants they have placed with the processor.
as to avoid surprises and disappointment. VARs sometimes have difficulty understanding this
requirement given that a typical VAR business is not
APIs and tokenization of data vastly simplify the regulated the way an ISO is regulated by obligations to
integration of two or more parallel relationships with both processors and payment networks.
a single merchant. The ISO should be able to continue
servicing the merchant even if the VAR cannot and vice Flexibility and open mindedness are cornerstones to
versa. success in relationships between ISOs and VARs. When
one party attempts to take greater control of the merchant
ISOs must be especially careful if medical data is involved. relationship than is natural, the merchant suffers and both
Medical data is subject to law relating to confidentiality suppliers suffer as well.
and consents (the Health Insurance Portability and In publishing The Green Sheet, neither the author nor the publisher is
Accountability Act) that may become binding on an ISO engaged in rendering legal, accounting or other professional services.
if it is integrated with a medical VAR. In simple terms, an If legal advice or other expert assistance is required, the services of a
ISO should avoid coming into contact with medical data.
competent professional should be sought. For further information on
this article, please contact Adam Atlas, attorney at law by email at
atlas@adamatlas.com or phone at 514-842-0886.

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