If you sell gift cards to consumers in New South Wales, it may be time for you to update your terms and conditions.
Starting 31 March 2018, gift cards sold:
- to a consumer in New South Wales (including interstate visitors); or
- to a consumer who provides a New South Wales address when buying the gift card (eg online),
- a minimum expiry period of 3 years from the date of sale; and
- no post-purchase fees, including activation fees, balance enquiry fees and any other administrative fees which would effectively reduce the card balance.
Any gift cards sold before 31 March 2018 will continue under the terms and conditions of those cards.
There are, of course, some exceptions to the new laws, including:
- free gift cards;
- gift cards provided in exchange for returned products;
- prepaid gift cards or travel cards;
- gift cards provided as part of a customer loyalty program;
- gift cards donated to a charity for a fundraising event;
- gift cards sold to other businesses; and
- replacements for lost or stolen gift cards sold before 31 March 2018.
Have leftover printed gift cards?
If you have an existing stock of printed gift cards which are not compliant, you can continue to use them until 30 September 2018, provided you make it clear to customers that the gift cards have:
- a 3-year expiry; and
- no post-purchase fees.
An example of how you can do this is by:
- crossing out the old expiry date and inserting the new expiry date (if any) on the gift card;
- crossing out any reference to administrative fees on the gift card;
- informing a customer of the changes prior to purchase; and
- displaying a clear sign at the store counter (or prior to checkout, if the gift card can be bought online) which explains the changes.
If you are unsure whether your gift cards are caught by the new laws, we suggest seeking legal advice. A breach can attract a $550 fine and a maximum penalty of $5,500, which cost would be better spent on more gift cards!