People generally enjoy receiving a gift card so that they can go and buy the gift they want. Unfortunately, it is estimated that NSW consumers lose up to $60 million a year when gift cards expire with unused value left on them.
With the increasing popularity of gift cards and e-cards, there have been a number of complaints to NSW Fair Trading regarding the expiration of gift cards and the imposition of administration fees. There have also been complaints about increased prices when sporting and entertainment tickets are on-sold by the initial purchaser.
Legislation addressing the complaints came into effect 31 March 2018.
From 31 March 2018 all gift cards sold in NSW are subject to stricter requirements and penalties to ensure that customers do not lose money. Gifts cards bought in NSW before 31 March 2018 are not affected by the changes - they have the same expiry date and terms and conditions that applied at the time of purchase. Suppliers of gift cards will have until 30 September 2018 to use pre-printed gift cards but they must notify consumers of the new expiry date.
The changes to legislation have the effect that all gift cards sold and delivered to an address in NSW must not have an expiry date of less than three (3) years. Failure of a business to comply with this could result in a penalty infringement notice of $550 and result in a maximum penalty of $5,500. Gift cards sold to consumers will no longer be permitted to have any administrative charges or fees that reduce the redeemable value of the gift card.
Ticket scalping is also being reigned in. The transaction cost when purchasing a ticket from the original supplier of the ticket may not exceed 10% of the supply cost. If the ticket is resold, the first purchaser may not resell the ticket for more than the original supply cost plus the transaction cost.
The legislation also prohibits conduct that circumvents the security measures of a website used for online purchases of tickets, such as using robots.
The maximum fine for contravening the legislation in relation to ticket sales is $22,000 for an individual or $110,000 for a company.
If you would more information about the changes please visit the NSW Fair Trading website.