New gift card expiry laws – are you affected?
Posted on July 29, 2019
Last December there was a subtle change to the law around gift cards and vouchers in South Australia.
These must now have an expiry date of at least 3 years from their date of issue.
The new law targets the familiar ‘monetary gift card’, such as a Coles Myer voucher, Woolworths e-gift card, etc. Apple iTunes cards are thought not to be caught (nor indeed Google Play cards), but in any event these have no expiry date (Apple) or a 5-year expiry (Google Play).
There is also an equivalent Federal law which applies (Treasury Laws Amendment (Gift Cards) Act 2018, in force from 1 November 2019), and an equivalent NSW law (Fair Trading Act 1987), both very similar to the South Australian provision.
The aim is to remedy the perceived unfairness that a consumer has only 12 (or even 6) months to use up a gift card; and also to stop businesses from ‘stampeding’ consumers into making impulse purchases just before a gift card is due to expire.
An administration fee may not be charged for use of a gift card. It is also potentially a criminal breach to issue a card or voucher which purports to carry an expiry date of less than 3 years (maximum penalty = $5000), and a voucher or card issued with a shorter expiry is automatically converted to one with the proper 3 year expiry period.
Certain categories of vouchers and cards are not caught by the new law: vouchers for temporary experiences such as live entertainment or exhibitions; for phone credit, internet access, or other utilities; customer loyalty cards or rewards; temporary marketing promotions in connection with the purchase of goods or services; reloadable prepaid cards, or bank cards.
Importantly, a 6 month ‘transitional period’ was put in place to allow businesses time to adjust to the new law. That expired last month.
If you’re unsure whether your business might be caught, please feel free to contact us for specific advice.