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Senate passes bill prohibiting expiry dates on gift checks

The Senate today passed on third and final reading a bill seeking to prohibit merchants from imposing expiry dates on gift checks, certificates or cards.

"A gift certificate, check or card is, for all intents and purposes, good as cash. It is purchased with money and money having no expiry date, it follows that gift checks must bear no expiry date," Senator Juan Miguel "Migz" Zubiri, chairman of the Senate Committee on Trade, Commerce, and Entrepreneurship and author of Senate Bill No. 1466, said.

Under the measure, sellers are prohibited from issuing a gift check that bears an expiry date. It is also deemed unlawful to impose an expiry date on the stored value, credit, or balance of the gift check. Further, the proposed law prohibits merchants from refusing to honor the unused value, credit or balance stored in the gift check.

Any person who violates the provisions of the measure shall, upon conviction, be subject to a fine of not less than P50,000 but not more than P1 million, according to the bill. Zubiri said coupon or vouchers were not covered by the bill's provisions.

The bill defined gift checks as "any instrument issued to any person, natural or juridical, for monetary consideration, honored upon presentation at a single merchant or an affiliated group of merchants as payment for consumer goods or services. The instrument may be in the form of paper, card, code, or other device."

On the other hand, a coupon or voucher was defined by the bill as "any instrument issued to any person, natural or juridical, for monetary consideration or otherwise, that entitles the holder to a discount off a particular good or service, or that may be exchanged for a pre-identified good or service specified on the instrument."

Excluded from the provisions of the measure are gift checks issued to customers "under loyalty, rewards or promotional programs, as determined by the Department of Trade and Industry (DTI)" and coupons and vouchers as defined by the bill.

The measure also provided equal protection for issuers and accredited merchants for instances when the gift check may not be honored, "such as when the gift check is lost due to no fault of the issuer, or when the gift check is mutilated or defaced due to no fault of the issuer and such damage prevents the issuer from identifying its security and authenticity features."

The measure also does not prevent a merchant from prescribing reasonable rules for changing, upgrading, or updating the gift check, certificate, or card, for as long as the changes does not impose any additional cost to the consumer.

"Once enacted, this will firm up the gains of consumers, both buyers and recipients of gift checks," Zubiri said.

Source: Senate of the Philippines

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