12 September 2024
The Fair Trading (Gift Card Expiry) Amendment bill provides retailers with 18 months to put in place new systems to comply with new legislation providing a minimum three-year expiry date on all gift cards. It is expected that the new three-year term will be in place by March 2026. The changes provide clarity for retailers on their obligations when issuing a gift card.
“The 18-month transition will enable businesses to put in place processes and systems to ensure accurate recording of gift cards can be put in place. Additionally, the financial treatment of gift cards is critical to ensure that obligations and appropriate tax treatment is consistent over the term of the unredeemed cards” says Carolyn Young, Chief Executive at Retail NZ.
The bill excludes any cards or credit issued through loyalty programs and credit in exchange for returned purchases.
For more details or to set up an interview with Retail NZ Chief Executive Carolyn Young, please contact Carolyn on 021 449 452.
For the latest Retail NZ Media Releases click here.
Summary of the Fair Trading (Gift Card Expiry) Amendment bill
Below is our summary of the requirements, ahead of the new Act being published. The new Act is awaiting Royal assent, and should be available on the Government’s legislation website before the end of September.
- The Bill’s provisions will come into effect 18 months after Royal assent, so mid-March 2026 (exact date depends on date of Royal assent)
- The legislation introduces a requirement that gift cards have an expiry date of no less than 3 years from the date of sale.
- The expiry date will need to be printed on the gift card in one of the following specified ways, giving traders some flexibility
- The expiry date (nominated date)
- The month and year in which the gift card ceases to be redeemable
- The date the card is sold and a statement that identifies the period during which the gift card can be redeemed.
- The words “no expiry date” or word to that effect.
- A gift card is defined as follows
- Gift card means a card or voucher (in whatever form) that is redeemable for the goods or services, but does not include:
- A card or voucher supplied in substitution for good returned to the supplier of the goods; or
- A prepaid card or voucher redeemable for telecommunications services, public transport, or electricity, gas, for water services; or
- A debit card, credit card, prepaid travel card, or similar card that allows the withdrawal of cash; or
- A card or voucher supplied as part of a loyalty programme (other than a card supplied in exchange for a reduction in customer loyalty points [so purchased gift cards that are purchased via points are included and vouchers that given away as part of a promotion are excluded]).
- A card or voucher redeemable only for goods or services at a limited time event (such as a festival, concert etc)
- A card or voucher sold principally to raise funds for a charitable purpose.
- Gift card means a card or voucher (in whatever form) that is redeemable for the goods or services, but does not include:
- There will be an infringement regime for non-compliance. Fees to be prescribed in regulations but must not exceed $10,000 for an individual, and $30,000 for body corporate.
DISCLAIMER:Â Â We are not lawyers and do not give legal advice. If in doubt consult your lawyer. While all care is taken in giving this advice, it is given on the condition that Retail NZ and its officers, employees and Board members are not liable for the results of any action taken in reliance upon this advice.
