First Data 2008 Annual Report Download - page 18

subject to the rules of such associations and First Data Canada Merchant Solutions ULC is a member of Interac and subject to its rules. First Data Cono Sur,
S.A., is a member of MasterCard in Argentina and Uruguay and subject to MasterCard rules. First Data Resources, LLC., First Data Merchant Services
Corporation, FDRL, First Data Deutschland, First Data Hellas Processing Services and Holdings S.A., First Data Latvia, First Data Lithuania, First Data
Polska S.A., First Data Slovakia, First Data Austria, First Data Resources Australia Limited ("FDRA"), BWA Merchant Services Pty Limited ("BWAMS"),
Omnipay, Limited, First Data Acquisition Corp., First Data Merchant Services Mexico, S. de R.L. de C.V., First Merchant Service GmbH, AIB Merchant
Services, European Merchant Services, BNL Positivity, Merchant Solutions Private Limited (as incorporated in Singapore, Hong Kong, Bangladesh and Sri
Lanka), Merchant Solutions Private (Macau) Limited, Merchant Solutions Sdn Bhd, POS Merchant Solutions (B) Sdn Bhd, POS Merchant Solutions Private
Limited, Merchant Solutions (Shanghai) Consulting Co. Ltd and STAR Network are registered with Visa and/or MasterCard as service providers for member
institutions. In those situations where the Company serves as service providers to member institutions, the Company is not an acquirer under Visa's and
MasterCard's rules. Various subsidiaries of the Company are also processor level members of numerous debit and electronic benefits transaction ("EBT")
networks, such as Star Networks, Inc., Star Processing Inc., First Data Merchant Services Corporation, and Concord Transaction Services, LLC, or are
otherwise subject to various network rules in connection with processing services and other services they provide to their customers and a number of the
Company's subsidiaries are providing processing and other services related to ATM deployment to customers. As such, the Company is subject to applicable
card association, network and national scheme rules, which could subject the Company to a variety of fines or penalties that may be levied by the card
associations, banking associations or networks for certain acts and/or omissions by the Company, its sponsorees, acquirer customers, processing customers
and/or merchants. The Company mitigates this risk by maintaining an extensive card association and network compliance function. The Company is also
subject to network operating rules promulgated by the National Automated Clearing House Association relating to payment transactions processed by the
Company using the Automated Clearing House Network and to various state laws regarding such operations, including laws pertaining to EBT.
Cashcard Australia Limited ("Cashcard") is a member of the Australian Consumer Electronic Clearing System ("CECS"), which is a debit payment
system regulated by network operating rules established and administered by Australian Payments Clearing Association Limited and which facilitates the
clearing and settlement of ATM and Electronic Funds Transfer at Point of Sale ("EFTPOS") payments in Australia. The network operating rules impose a
variety of sanctions, including suspension or termination of membership and fines for non-compliance. Cashcard also operates its own network of members,
regulated by rules promulgated by Cashcard, which facilitates access to CECS for Cashcard's member institutions. To enable Cashcard to settle in CECS
direct with banks and financial institutions, Cashcard maintains an Exchange Settlement Account ("ESA") which is supervised by the Reserve Bank of
Australia through its delegate, the Australian Prudential Regulatory Authority ("APRA"), and which requires Cashcard to adhere to conditions imposed by
APRA, such as maintaining a minimum balance in the ESA.
The Company's subsidiary in Germany, TeleCash GmbH & Co. KG ("TeleCash"), is certified and regulated as a processor for domestic German debit
card transactions by the Zentraler Kreditausschuss ("ZKA"), the German banking association. Failure to comply with the technical requirements set forth by
the ZKA may result in suspension or termination of services.
Privacy and Information Security Regulations
Each of the Company's segments provides services that may be subject to various state, federal and foreign privacy laws and regulations. Relevant
federal privacy laws include the Gramm-Leach-Bliley Act, which applies directly to a broad range of financial institutions and indirectly to companies that
provide services to financial institutions, and the Health Insurance Portability and Accountability Act, which applies directly to certain healthcare-related
businesses and indirectly to companies that provide services to such businesses. Relevant foreign privacy laws include Directive 95/46 EC of the European
Parliament and of the Council of 24
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