THIS is the time of year when many of us purchase gift vouchers for friends and family.
There are many benefits to gift vouchers but there are also some risks, for example, if you lose the voucher, it expires before you use it, or if you’re unable to spend the remaining balance. It is important you know the conditions and rules that apply before buying a gift voucher.
Irish law introduced extra protections for gift vouchers sold on or after December 2nd 2019, under the Consumer Protection (Gift Vouchers) Act 2019. The following are some common queries that the Citizens Information Service receive in relation to gift vouchers
What is a gift voucher?
Gift vouchers are any voucher, coupon or other document (including an electronic document) that can be used instead of money to pay (or pay in part) for goods and services. Gift vouchers come in different forms, such as paper gift certificates, electronic cards or gift cards. They can be issued by a single business or for a group of shops (such as a shopping centre).
When you buy a gift voucher, you enter into a contract with the trader. The voucher is like cash that you hand over in exchange for goods and services.
What are the current rules that apply to gift vouchers?
The rules for gift vouchers sold after 2nd December 2019 are set out in the Consumer Protection (Gift Vouchers) Act 2019.
The rules state:
Gift vouchers must have no expiry date or be valid for at least five years - see ‘expiry dates on gift vouchers’ below
Traders cannot specify that a gift voucher is spent in one transaction
Traders cannot charge a fee to change the name on a gift voucher (if you have to register a name on the voucher)
If the balance remaining on a gift voucher is more than €1 after you buy something with it, a trader must reimburse the balance to you. They can give you cash, make an electronic transfer or give you another gift voucher.
Are there any exceptions to the rules?
The rules do not apply to:
Vouchers you can only use to buy specified goods and services at a discounted price, from a specified trader on a specified date, or for a specified period of three months or less. For example, vouchers from deal websites such as Groupon or Pigsback
Vouchers issued as part of a customer loyalty or promotion scheme
Vouchers issued as a refund for goods you returned to a trader
Vouchers and gift cards sold before 2nd December 2019. The expiry period and the terms and conditions that applied at the time of purchase still apply to these vouchers.
The rules do not apply to electronic money gift cards.
What is an electronic money gift card?
In general, electronic money gift cards (for example, One4all gift cards), are cards that can be used in a number of different shops.
Electronic money gift cards are regulated under the European Communities (Electronic Money) Regulations 2011. The Central Bank is responsible for enforcing these regulations.
Under the Regulations:
You must be informed of the conditions for using the e-money card, including any fees before you buy the card
Fees must be proportionate and in line with the costs actually incurred by the e-money issuer (that is, the business who issues the card to you)
Is there an expiry dates on gift vouchers?
There is a five-year minimum expiry date for all vouchers sold after 2 December 2019. This is set out in the Consumer Protection (Gift Vouchers) Act 2019.
Under the rules, gift vouchers must either:
Have no expiry date, or
Must be valid for at least five years from the date the gift voucher is issued.
You must be given details of the expiry date in a durable format (for example, on paper or by email) at the time you buy the gift voucher.
The legislation does not apply to gift vouchers bought before 2 December 2019.
What are my rights if I lose a gift voucher?
Gift vouchers are like cash, so if you lose them, the company does not have to replace them. If a voucher was made out to you specifically and is not transferable to anyone else, you may be able to get a replacement. This depends on the gift voucher’s terms and conditions and the company’s policy.
If you lose a gift card, you may be able to get a replacement card but you need to check with the retailer. You could be charged a fee for the replacement card.
What happens if a trader goes out of business?
If a trader goes out of business before you use the voucher, you may have difficulty getting your money back.
Usually, the trader will owe money to several people so your claim is just one of many. There are rules for the priority to be given to the various debts owed in the case of the business going into liquidation or receivership. Generally, you will be low in the order of priority.
You will need to make a claim in writing to the appointed administrator or liquidator (if applicable) providing proof of your voucher. However, it is unlikely your voucher will be honoured. If a new owner takes over, they do not have to honour your voucher.
For this reason, you should buy gift vouchers using a credit or debit card, as you may be able to use chargeback through your bank or credit card provider.
The Competition and Consumer Protection Commission (CCPC) has more information on companies going out of business on www.ccpc.ie