What fees are Atwell Suites franchisees responsible for related to chargebacks?
Atwell_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
. You acknowledge and agree that you will not use, or provide Cardholder data access to, any Merchant Provider until you receive our approval (which approval shall not be unreasonably withheld) and, if required, confirmation of our registration of that Merchant Provider with applicable Card Organizations.
- (b) Merchant Provider Compliance. You must ensure that you and Merchant Providers: (i) comply with the registration process which can involve site inspections, background investigations, provision of financial statements, and any other information required by us or a Card Organization; (ii) comply with the periodic and other reporting required by a Card Organization; and (iii) comply with all applicable Card Organization Rules, including without limitation, those requiring security of Cardholder data. You may allow Merchant Providers access to Cardholder data only for purposes authorized under and in conformance with the Card Organization Rules. You are responsible for all our costs and expenses associated with our review, approval, certification (and recertification as may be required by us or the Card Organization Rules) and registration of any Merchant Providers.
- 4.7 Data Security Measures; Fraud. Security features such as CAPTCHA, velocity filters, the Address Verification Service, and requiring a Card Verification Code for Card Not Present Transactions can help combat fraud. Using AVS when submitting Authorization requests for Card Not Present Transactions can help you identify potentially fraudulent transactions and can help lower Card Organization interchange rates, but it does not guarantee a transaction is valid and the AVS response does not impact whether an Authorization request is approved or denied. We may charge you an AVS fee for any AVS request you submit, even if we are not able to provide a response to the request. You are responsible for all Chargebacks, Third Party Based Fees, Servicers Fees, and other amounts arising from fraudulent activity processed through your Merchant Systems and/or your Merchant Account (regardless of any AVS response that you receive).
- 4.8 Costs. If you or a Merchant Provider (or other Third Party used by you) are determined by any Card Organization, regardless of any forensic analysis or report, to be the likely source of any loss, disclosure, theft or compromise of Cardholder data or Card transaction information or are determined to have caused Cardholder data to be put at risk (together, "Compromised Data Events") and regardless of your belief that you have complied with the Card Organization Rules or any other security precautions and are not responsible for the Compromised Data Event, you must promptly pay us for all related expenses, claims, assessments, fines, losses, costs, penalties, and Issuer reimbursements imposed by the Card Organizations against us (together, "Data Compromise Losses").
Source: Item 23 — Receipts (FDD pages 99–486)
What This Means (2025 FDD)
According to Atwell Suites' 2025 Franchise Disclosure Document, franchisees are responsible for all chargebacks and related fees associated with transactions they submit. This includes the chargebacks themselves, along with any fees, fines, penalties, assessments, and other amounts related to disputing or arbitrating a chargeback. These costs apply whether the chargeback is settled in the franchisee's favor or the cardholder's favor.
Atwell Suites franchisees must also reimburse the franchisor for all transactions that are charged back, covering all related amounts as specified in the agreement. This encompasses fees, fines, penalties, and assessments linked to disputing a chargeback or failing to provide necessary records within the required timeframes. The franchisee's responsibility extends to all chargeback fees outlined in the fee schedule or elsewhere in the agreement.
Furthermore, even after the Atwell Suites franchise agreement expires or terminates, the franchisee remains responsible for all chargebacks, fees, and other amounts associated with transactions submitted during the term of the agreement. This obligation continues until all such fees and chargebacks have been paid in full, regardless of whether the transactions occurred before or after the termination date. This ensures that the franchisor is protected from financial losses due to unresolved chargebacks even after the franchise relationship ends.
In the event of a data compromise, where the franchisee or their merchant provider is deemed the likely source of a data breach, the franchisee is responsible for all related expenses, claims, assessments, fines, losses, costs, penalties, and issuer reimbursements imposed by card organizations. This includes expenses and claims made by issuers alleging responsibility for the compromised data event, separate from any claim procedures administered by the card organizations. However, Atwell Suites agrees not to pass through to the franchisee any amounts imposed upon them by card organizations in connection with their own data security event.