New legislation to control and cut credit card fees and limiting consumer penalties was on Wednesday cleared by the House Financial Services Committee.

Members of the House Financial Services Committee voted 48 to 19 for the Credit Cardholders' Bill of Rights which in practice would codify into law restrictions on deceptive practices issued by the Federal Reserve in December.

The legislation is necessary to ensure that consumers get fair prices for credit, consumer advocates say, while industry groups counter that legislation could actually raise prices and cut access to credit.

The legislation would stop credit card issuers from imposing arbitrary interest rate increases and penalties, and halt certain billing practices.

The House bill is very similar to rules approved last year by the Federal Reserve and other regulators that would go into effect July 1, 2010. The House version calls for implementation 12 months after enactment, or by July 1, 2010, whichever is sooner. A provision to require advanced notice of interest rate hikes would go into effect 90 days after enactment.