Since 31 March this year, new requirements have been in place that are relevant for certain gift cards sold in NSW or to consumers who provide an address based in NSW (the requirements also catch gift cards sold online).
Certain gift cards and vouchers are excluded from the requirements including those given for free, in place of exchanged goods, loyalty cards, promotional cards/vouchers for use within a specified time frame and prepaid cards amongst others.
The key changes:
- require most gift cards sold in NSW to have at least a minimum 3 year expiry date from the date of sale; and
- prohibit the charging of any fees associated with redeeming a gift card that would reduce the value of the gift card (for example, activation fees or any other fees that may be charged for admin of gift cards).
A breach of the new gift card laws could attract a penalty infringement notice of $550 issued by NSW Fair Trading and result in a maximum penalty of $5,500.
A transition period will be in operation until 30 September 2018, meaning that businesses can run down their existing stock of gift cards but must notify customers of the new requirements (i.e. by updating the terms on their website or physically amending any gift cards sold during the transition period).
During the transition period, organisations should ensure that they take stock of their gift cards, consider whether a consistent approach should be rolled out across all of their gift cards and ensure that relevant and correct information is given to customers at the point of sale about any gift card they may purchase.
This blog was co-authored by Claire Kermond, Jessie Buchan and Melinda Upton.