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SAN FRANCISCO — A federal appeals court on Friday overturned laws in San Francisco and Santa Monica that ban certain ATM fees charged by banks. 

The 9th U.S. Circuit Court of Appeals, in upholding an earlier judge’s ruling, said only the federal government, not local voters or city councils, may create such regulations. 

The San Francisco-based appeals court ruled that federal banking regulations adopted by Congress allow banks to charge fees for ATM usage. That being the case, the City Council of Santa Monica and San Francisco voters had no authority to approve identical laws in 1999 banning a bank from charging an ATM fee to a customer not a member of that bank. 

“We find that the ordinances are pre-empted by federal law and regulations and thus invalid,” Judge Joseph T. Sneed wrote in his ruling. 

Leland Chan, a lawyer for the California Bankers Association that challenged the rules, said the court made the right decision. He called the rules contrary to free-market capitalism. 

“Can you imagine voters telling Intel how much to charge for its chips?” he asked. 

The 3-0 decision upholds U.S. District Judge Vaughn Walker, the San Francisco federal judge who blocked the ordinances from being enforced at the request of Bank of America, Wells Fargo Bank and others. 

The cities said they are mulling over whether to appeal to the U.S. Supreme Court, or whether to ask the court to reconsider its decision. 

Adam Radinsky, Santa Monica deputy city attorney, said federal banking regulations do allow local governments or city voters to adopt such rules. He said Arkansas, Mississippi and Wyoming have rules limiting the amount of ATM fees banks may levee. 

The cities also argued that California consumer protection laws allow such laws. 

“The ATM surcharge is an outrageous and duplicative fee that is unfair to consumers,” Radinsky said. 

The law doesn’t challenge fees a bank charges its own customers to use a different bank’s ATM. Those fees range around $2. 

The law thrown out Friday challenged the rights of banks in the two cities to charge customers who do not bank with them an additional surcharge to use their ATM — roughly $1.50 per transaction. 

It became clear during oral arguments in January that the court ultimately would rule as it did Friday. At the time, the judges appeared unmoved by city lawyers defending the ordinances.