Bill Text: NY A08652 | 2019-2020 | General Assembly | Amended

---

Bill Title: Relates to fees for gift cards; limits the amount a merchant may charge for the gift card; and prohibits the expiration of such gift cards.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2020-01-14 - print number 8652a [A08652 Detail]

Download: New_York-2019-A08652-Amended.html

---

                STATE OF NEW YORK
        ________________________________________________________________________

                                         8652--A

                               2019-2020 Regular Sessions

                   IN ASSEMBLY

                                     October 2, 2019
                                       ___________

        Introduced by M. of A. WEPRIN -- read once and referred to the Committee
          on  Consumer Affairs and Protection -- recommitted to the Committee on
          Consumer Affairs and Protection in accordance with  Assembly  Rule  3,
          sec.  2  --  committee  discharged, bill amended, ordered reprinted as
          amended and recommitted to said committee

        AN ACT to amend the general business law, in relation to fees  for  gift
          cards

          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:

     1    Section 1. Subdivisions 1, 3, 5, and  5-a  of  section  396-i  of  the
     2  general  business  law,  subdivision  1 as amended by chapter 170 of the
     3  laws of 2004 and subdivisions 3 and 5 as amended and subdivision 5-a  as
     4  added by chapter 329 of the laws of 2016, are amended and a new subdivi-
     5  sion 5-b is added to read as follows:
     6    1.(a) For the purposes of this section, the following terms shall have
     7  the following meanings:
     8    (1)  "gift  certificate"  shall  mean a [written promise or electronic
     9  payment device that: (i) is usable at a single merchant or an affiliated
    10  group of merchants that share the same name, mark, or logo, or is usable
    11  at multiple, unaffiliated merchants or service providers;  and  (ii)  is
    12  issued  in  a specified amount; and (iii) may or may not be increased in
    13  value or reloaded; and (iv) is purchased  and/or  loaded  on  a  prepaid
    14  basis  for the future purchase or delivery of any goods or services; and
    15  (v) is honored upon  presentation.]  certificate,  electronic  card,  or
    16  other  pre-funded  record  that evidences the giving of consideration in
    17  exchange for the right to redeem such record for goods, services,  cred-
    18  it, or money of at least an equal value to the amount shown on, embedded
    19  in, or associated with, such record; and
    20    (2)  "promotional  gift  certificate"  shall  mean  a gift certificate
    21  issued for no consideration which includes on  the  front  of  the  gift
    22  certificate  (i)  a  statement  indicating  that  the card is issued for

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD11662-04-9
        A. 8652--A                          2

     1  promotional purposes and (ii) the expiration  date  for  the  underlying
     2  funds.
     3    (b)  Gift  certificate  shall not include an electronic payment device
     4  linked to a deposit account, or prepaid telephone  calling  cards  regu-
     5  lated under section ninety-two-f of the public service law. Gift certif-
     6  icate  also  shall not include flexible spending arrangements as defined
     7  in  Section  106(c)(2)  of  the  Internal  Revenue  Code,  26  U.S.C.  §
     8  106(c)(2);  flexible  spending  accounts  subject  to Section 125 of the
     9  Internal Revenue Code, 26 U.S.C.  §  125;  Archer  MSAs  as  defined  in
    10  Section 220(d) of the Internal Revenue Code, 26 U.S.C. § 220(d); depend-
    11  ent  care  reimbursement accounts subject to Section 129 of the Internal
    12  Revenue Code, 26 U.S.C.  §  129;  health  savings  accounts  subject  to
    13  Section  223(d)  of  the  Internal  Revenue Code, 26 U.S.C. § 223(d), as
    14  amended by Section 1201 of the Medicare Prescription Drug,  Improvement,
    15  and Modernization Act of 2003, Pub. L.  No. 108-173; or similar accounts
    16  from  which,  under the Internal Revenue Code and its implementing regu-
    17  lations, individuals may pay medical  expenses,  health  care  expenses,
    18  dependent  care  expenses,  or  similar expenses on a pretax basis. Gift
    19  certificate also shall not include a prepaid discount  card  or  program
    20  used  to  purchase identified goods or services at a price or percentage
    21  below the normal and customary price; provided that [the] any expiration
    22  date of the prepaid discount card or program is clearly and conspicuous-
    23  ly disclosed. Gift certificate also shall not include payroll  cards  or
    24  other  electronic  payment devices which are linked to a deposit account
    25  and which are given in exchange for goods or services rendered.
    26    3. The terms and conditions of a gift certificate store  credit  shall
    27  be clearly and conspicuously stated thereon. Terms [and conditions shall
    28  include  the  expiration date, whether any fees are assessed against the
    29  balance of the gift certificate, and whether a fee will be  charged  for
    30  the  replacement  of  a  gift  certificate  that  is  lost,  stolen,  or
    31  destroyed, if any. Additional terms] and conditions including,  but  not
    32  limited  to,  policies  related to refunds, warranties, changes in terms
    33  and conditions, the procedure for the replacement of a gift certificate,
    34  if any, assignment and waiver shall be conspicuously printed: (a) on the
    35  gift certificate; or (b) on an envelope or packaging containing the gift
    36  certificate, provided that a toll free telephone number  to  access  the
    37  additional  terms  and conditions is printed on the gift certificate; or
    38  (c) on an accompanying document, provided that  a  toll  free  telephone
    39  number  to  access the additional terms and conditions is printed on the
    40  gift certificate.
    41    5. (a) No person, firm, partnership, association or corporation  shall
    42  charge  or assess, or sell or issue any gift certificate subject to, any
    43  activation fee, retroactive [fees  shall  be  assessed  against  a  gift
    44  certificate.
    45    (b)  No  monthly]  fee,  redemption fee, service [fees may be assessed
    46  against the balance of a gift  certificate  prior  to  the  twenty-fifth
    47  month  of  dormancy] fee, dormancy fee, latency fee, administrative fee,
    48  handling fee, access fee, periodic fee, renewal fee, re-loading fee,  or
    49  any other fee of any kind.
    50    [(c)  A  service  fee may be assessed after the twenty-fourth month of
    51  dormancy provided that any such fee shall be waived and the gift certif-
    52  icate replenished to its value prior to such fees being  assessed  where
    53  the  holder  of  such  gift  certificate presents the certificate within
    54  three years of issue] (b) No person, firm, partnership,  association  or
    55  corporation  shall  sell  a  gift  certificate  that has a face value or
        A. 8652--A                          3

     1  balance that declines as a result of the passage of time or the dormancy
     2  of the gift certificate.
     3    [(d)]  (c) For the purposes of this subdivision, "dormancy" shall mean
     4  non-use of a gift certificate. Use of a gift certificate shall  include,
     5  but not be limited to, adding value, or purchases.
     6    5-a.  It  shall  be  unlawful  for  any person to sell or issue a gift
     7  certificate other than a promotional gift  certificate  where  the  gift
     8  certificate  or  the  underlying funds are subject to an expiration date
     9  [which is earlier than five years after  the  date  on  which  the  gift
    10  certificate was issued, or the date on which funds were last loaded to a
    11  store  gift card. The terms of expiration shall be clearly and conspicu-
    12  ously stated on the gift certificate].
    13    5-b. A gift certificate with a  remaining  value  of  less  than  five
    14  dollars  may be redeemed upon request for its cash value provided that a
    15  gift certificate that may be redeemed at more than  one  merchant  shall
    16  only be redeemable for such cash value from the merchant from which such
    17  gift certificate was acquired.
    18    §  2.  This  act shall take effect 1 year after it shall have become a
    19  law.