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New 3-year minimum life for gift cards

The ACCC is alerting small businesses that new national rules for gift cards came into effect on November 1 and apply to all Australian businesses.

Gift cards need to have a minimum life of three years before expiry and have the expiry date clearly stated.

Under the new rules, part of the strengthened Australian Consumer Law, any gift card supplied on or after November 1 2019 must:
– be redeemable for at least three years after the date of purchase;
– prominently display the expiry date as either the full date, or as a period of time which must include the date of issue;
– state on the gift card if there is no expiry date.

Gift cards can no longer come with a ‘post-supply fee’ – a fee or charge that the gift card recipient has to pay in relation to a gift card after it has been supplied.

This excludes fees and charges such as booking fees, exchanging currencies, those related to the reissue of a gift card that has been lost, stolen or damaged, and payment surcharges.

The ACCC has advised business which use gift cards to:
– check the expiry period of gift cards supplied from November 1 to ensure the dates are clearly displayed on the card. Also make it clear if there is no expiry date;
– check any terms and conditions attached to your gift cards supplied after 1 November 2019;
– do not tell customers that these new requirements do not apply to gift cards supplied after  November 1 unless they fall within one of the categories of exception;
– check if there are any state based laws that could also apply.

You can find more information on the ACCC website at: Rules for gift cards.

Mandatory text for warranties
Since June 9 this year, businesses have also been required to use mandatory text on their written ‘warranties against defects’ when supplying services, or when supplying goods with services, which are in addition to mandatory text for the supply of goods.

The mandatory text for the supply of goods with services is:

Our goods and services come with guarantees that cannot be excluded under the Australian Consumer Law. For major failures with the service, you are entitled:

  • to cancel your service contract with us; and
  • to a refund for the unused portion, or to compensation for its reduced value.

You are also entitled to choose a refund or replacement for major failures with goods. If a failure with the goods or a service does not amount to a major failure, you are entitled to have the failure rectified in a reasonable time. If this is not done you are entitled to a refund for the goods and to cancel the contract for the service and obtain a refund of any unused portion. You are also entitled to be compensated for any other reasonably foreseeable loss or damage from a failure in the goods or service.

This is to ensure that consumers are aware that any warranty against defects operates in addition to their consumer guarantee rights under the Australian Consumer Law.

Visit the ACCC website to find out more about information that must be included at: Warranties against defects.

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