Bill Text: NY A04629 | 2021-2022 | General Assembly | Amended

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Bill Title: Relates to fees for gift cards; limits the amount a merchant may charge for the gift card; prohibits the expiration of such gift cards or certificates with the exception of promotional gift certificates in which such certificates may not expire earlier than 9 years after the date it was issued.

Spectrum: Moderate Partisan Bill (Democrat 8-1)

Status: (Introduced - Dead) 2021-06-07 - substituted by s3467b [A04629 Detail]

Download: New_York-2021-A04629-Amended.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                         4629--C
                                                                   R. R. 177

                               2021-2022 Regular Sessions

                   IN ASSEMBLY

                                    February 4, 2021
                                       ___________

        Introduced  by M. of A. SAYEGH, ENGLEBRIGHT, EPSTEIN, GRIFFIN, MAGNAREL-
          LI, DICKENS, ABINANTI, JACKSON, DeSTEFANO -- read once and referred to
          the  Committee  on  Consumer  Affairs  and  Protection  --   committee
          discharged, bill amended, ordered reprinted as amended and recommitted
          to  said  committee  -- again reported from said committee with amend-
          ments, ordered reprinted as amended and recommitted to said  committee
          --  reported  and referred to the Committee on Rules -- amended on the
          special order of third reading, ordered reprinted as amended,  retain-
          ing its place on the special order of third reading

        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
     7  have the following meanings:
     8    (1)  "gift  certificate"  shall  mean a [written promise or electronic
     9  payment device] certificate, electronic card, or other pre-funded record
    10  that: (i) is usable at a single  merchant  or  an  affiliated  group  of
    11  merchants  that  share  the  same  name,  mark, or logo, or is usable at
    12  multiple, unaffiliated merchants  or  service  providers;  and  (ii)  is
    13  issued  in  a specified amount; and (iii) may or may not be increased in
    14  value or reloaded; and (iv) is purchased  and/or  loaded  on  a  prepaid
    15  basis  for the future purchase or delivery of any goods or services; and
    16  (v) is honored upon presentation[.];
    17    (2) "open loop gift certificate" shall mean a gift certificate redeem-
    18  able at multiple, unaffiliated merchants or service providers; and

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD02680-08-1
        A. 4629--C                          2

     1    (3) "promotional gift  certificate"  shall  mean  a  gift  certificate
     2  issued  for  no  consideration  which  includes on the front of the gift
     3  certificate (i) a statement indicating  that  the  card  is  issued  for
     4  promotional  purposes  and  (ii)  the expiration date for the underlying
     5  funds.
     6    (b)  Gift  certificate  shall not include an electronic payment device
     7  linked to a deposit account or which is covered  by  the  exclusion  set
     8  forth  in 15 U.S.C. § 1693I-1(a)(2)(D)(ii), or prepaid telephone calling
     9  cards regulated under section ninety-two-f of the  public  service  law.
    10  Gift  certificate  also shall not include flexible spending arrangements
    11  as defined in Section 106(c)(2) of the Internal Revenue Code, 26  U.S.C.
    12  §  106(c)(2);  flexible  spending accounts subject to Section 125 of the
    13  Internal Revenue Code, 26 U.S.C.  §  125;  Archer  MSAs  as  defined  in
    14  Section 220(d) of the Internal Revenue Code, 26 U.S.C. § 220(d); depend-
    15  ent  care  reimbursement accounts subject to Section 129 of the Internal
    16  Revenue Code, 26 U.S.C.  §  129;  health  savings  accounts  subject  to
    17  Section  223(d)  of  the  Internal  Revenue Code, 26 U.S.C. § 223(d), as
    18  amended by Section 1201 of the Medicare Prescription Drug,  Improvement,
    19  and Modernization Act of 2003, Pub. L.  No. 108-173; or similar accounts
    20  from  which,  under the Internal Revenue Code and its implementing regu-
    21  lations, individuals may pay medical  expenses,  health  care  expenses,
    22  dependent  care  expenses,  or  similar expenses on a pretax basis. Gift
    23  certificate also shall not include a prepaid discount  card  or  program
    24  used  to  purchase identified goods or services at a price or percentage
    25  below the normal and customary price; provided that [the] any expiration
    26  date of the prepaid discount card or program is clearly and conspicuous-
    27  ly disclosed. Gift certificate also shall not include payroll  cards  or
    28  other  electronic  payment devices which are linked to a deposit account
    29  and which are given in exchange for goods or services rendered.
    30    3. The terms and conditions of a gift certificate store  credit  shall
    31  be clearly and conspicuously stated thereon. Terms [and conditions shall
    32  include  the  expiration date, whether any fees are assessed against the
    33  balance of the gift certificate, and whether a fee will be  charged  for
    34  the  replacement  of  a  gift  certificate  that  is  lost,  stolen,  or
    35  destroyed, if any. Additional terms] and conditions including,  but  not
    36  limited  to,  policies  related to refunds, warranties, changes in terms
    37  and conditions, the expiration date, if any, the activation fee, if any,
    38  the procedure for the replacement of a gift certificate, if any, assign-
    39  ment and waiver shall be conspicuously printed: (a) on the gift  certif-
    40  icate;  or  (b)  on an envelope or packaging containing the gift certif-
    41  icate, provided  that  a  toll  free  telephone  number  to  access  the
    42  additional  terms  and conditions is printed on the gift certificate; or
    43  (c) on an accompanying document, provided that  a  toll  free  telephone
    44  number  to  access the additional terms and conditions is printed on the
    45  gift certificate.
    46    5. (a) No person, firm, partnership, association or corporation  shall
    47  charge  or assess, or sell or issue any gift certificate subject to, any
    48  activation fee, retroactive [fees  shall  be  assessed  against  a  gift
    49  certificate.
    50    (b)  No  monthly]  fee,  redemption fee, service [fees may be assessed
    51  against the balance of a gift  certificate  prior  to  the  twenty-fifth
    52  month  of  dormancy] fee, dormancy fee, latency fee, administrative fee,
    53  handling fee, access fee, periodic fee, renewal fee, re-loading fee,  or
    54  any  other  fee  of  any  kind, other than an open loop gift certificate
    55  subject to an initial one-time activation  or  issuance  fee  reasonably
        A. 4629--C                          3

     1  related to the cost of the issuer issuing the open loop gift certificate
     2  and which shall in no event be in excess of nine dollars.
     3    [(c)  A  service  fee may be assessed after the twenty-fourth month of
     4  dormancy provided that any such fee shall be waived and the gift certif-
     5  icate replenished to its value prior to such fees being  assessed  where
     6  the  holder  of  such  gift  certificate presents the certificate within
     7  three years of issue] (b) No person, firm, partnership,  association  or
     8  corporation  shall  sell  a  gift  certificate  that has a face value or
     9  balance that declines as a result of the passage of time or the dormancy
    10  of the gift certificate.
    11    [(d)] (c) For the purposes of this subdivision, "dormancy" shall  mean
    12  non-use  of a gift certificate. Use of a gift certificate shall include,
    13  but not be limited to, adding value, or purchases.
    14    5-a. It shall be unlawful for any person  to  sell  or  issue  a  gift
    15  certificate other than a promotional gift certificate where the underly-
    16  ing  funds  are  subject  to  an  expiration  date, provided that a gift
    17  certificate may be subject to an expiration date which  is  not  earlier
    18  than  [five]  the  later  of nine years after the date on which the gift
    19  certificate was issued, or the date on which funds were last loaded  [to
    20  a  store  gift  card]. The terms of expiration of a gift certificate, if
    21  any, shall be clearly  and  conspicuously  stated  on  [the]  such  gift
    22  certificate.
    23    5-b. A gift certificate, other than an open loop gift certificate or a
    24  promotional  gift  certificate, with a remaining value of less than five
    25  dollars may be redeemed upon request for its cash value.
    26    § 2. This act shall take effect one year after it shall have become  a
    27  law.