New York Passes Gift Card Law Regarding Expiration and Fees
New York has a new law that aims to tackle “exploitative” gift card practices by limiting fees and extending expiration dates. The new law which is already in effect, states that any gift cards or certificates purchased in the state are valid for at least nine years from the date of purchase, according to the state’s Division of Consumer Protection. That extends the previous rule by four years.
You can also cash out your gift card balance if you only have a few bucks left in it. This is something offered in several states around the country. In New York, when the remaining value of a gift card or gift certificate is less than five dollars, the recipient can opt to receive cash for the balance.
The new law also limits fees. All fees are prohibited under the new law, which will prevent gift cards and gift certificates from declining in value. The law specifically forbids the imposition of any “activation fees, retroactive fees, redemption fees, service fees, dormancy fees, latency fees, administrative fees, handling fees, access fees, periodic fees, renewal fees, re-loading fees, or any other fee of any kind.” There is one exception to the law. A gift card or gift certificate that is redeemable at multiple, unaffiliated merchants or service providers may charge a one-time activation fee, not to exceed $9.
Consumers having difficulty redeeming a gift card are encouraged to file a complaint with the New York State Division of Consumer Protection. The Division of Consumer Protection provides voluntary mediation, between the consumer and business, when the consumer has been unsuccessful at reaching a resolution on their own. The Consumer Assistance Helpline 1-800-697-1220 is available Monday to Friday from 8:30am to 4:30pm, excluding State Holidays, and consumer complaints can be filed at any time at www.dos.ny.gov/consumer-protection. The Division can also be reached via Twitter at @NYSConsumer or Facebook at www.facebook.com/nysconsumer.
Important Dates
In New Yok State, a gift card or gift certificate’s purchase date determines what, if any, rights exist for consumers. Based on the purchase date, consumers can expect the following legal protections:
| Gift Cards & Gift Certificates Purchased: | Minimum Expiration Date Imposed by Law: | Inactivity Fee Terms: |
| Between September 21, 2004, and August 21, 2010 | No Law Requiring a Minimum Expiration Term. | A monthly inactivity service fee may be assessed monthly after the 12th month of inactivity. |
| Between August 22, 2010, and December 24, 2016 | 5-years from date of purchase before gift card can expire. | A one-time inactivity fee may be assessed after the 12th month of inactivity. |
| Between December 25, 2016, and December 9, 2022 | 5-years from date of purchase before the gift card can expire. | A monthly inactivity service fee may be assessed after the 24th month of inactivity. If the gift card is presented within 3 years of the purchase date, any activity fees assessed will be waived and the gift card will be replenished to its value prior to the fees. |
| On or after December 10, 2022 | 9-years from the date of purchase before the gift card can expire. | Inactivity fees are prohibited. |