OHIO ENACTS RESTRICTIONS ON GIFT CARDS
Effective June 15, 2006, Ohio law provides that no person or entity shall sell a gift card containing an expiration date that is less than two years after the date the card is issued. Ohio S.B. 33 (to be codified in Ohio Rev. Stat. 1349.61). Services charges or fees, including dormancy fees, latency fees or administrative fees, that reduce the total value of the card within two years after the card is issued are prohibited. The new law provides that a gift card sold without an expiration date is valid until redeemed or replaced with anew gift card.
The law defines “gift card” to mean a certificate, electronic card or other medium issued by a merchant that evidences the giving of consideration in exchange for the right to redeem the certificate, electronic card or other medium for goods, food, services, credit or money of at least an equal value. The term “merchant” is not defined in the law. The law expressly provides that “gift card” does not include a prepaid calling card used to make telephone calls.
The restrictions do not apply to certain gift cards, including a gift card that is usable with multiple, unaffiliated sellers of goods or services or a gift card that is distributed by the issuer to a consumer pursuant to an awards, loyalty or promotional program without any money or anything of value being given in exchange for the gift card by the consumer.
Those who violate the service charge restrictions of the gift card law are liable to the holder for any amount that the redemption value of the gift card was reduced, any court costs incurred and reasonable attorneys’ fees.
Jeff Langer and Elizabeth Anstaett