LOUISIANA LAW GOVERNING GIFT CARDS

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By Brian C. Flanagan

Many gift cards and gift certificates will no doubt be bought and sold as holiday season approaches. According to the National Retail Federation, in 2013, the average shopper spent approximately $163 on gift cards, and total spending on gift cards reached nearly $30 billion in total. This year, the NRF projects that amount will increase to over $172 per shopper and approximately $31.74 billion in total.[1]

In Louisiana, business owners and shoppers alike should be aware of two certain protections afforded by the Unfair Trade Practices and Consumer Protection Laws, found in Title 51 of the Louisiana Revised Statutes.

The first protection involves expiration dates. A gift certificate or gift card without an expiration date is valid until redeemed by the customer or replaced. However, if the gift certificate or gift card does have an expiration date, it date must appear on the face of the gift certificate or gift card in capital letters and in at least ten-point font. Importantly, a business cannot sell a gift card or gift certificate that expires sooner than five years from the date it is issued.

The second protection involves extra fees charged by the business associated with gift cards and gift certificates. Under this Unfair Trade Practices and Consumer Protection Laws, businesses are allowed to charge a service or purchase fee of up to $1.00 for each gift certificate or gift card sold.

However, these rules do not apply to gift certificates that are sold below face value or donated to non-profit and charitable organizations for fundraising purposes, as well as gift certificates that are distributed by the issuer to a consumer pursuant to an awards loyalty or promotional program without any money or other thing of value being given in exchange for the gift certificate by the consumer.

The penalty for a violation of these laws is up to $5,000 per violation. The law provides for additional penalties to be imposed if the violation occurs against an elderly or disabled person.

[1]https://nrf.com/media/press-releases/holiday-shoppers-spend-more-31-billion-gift-cards-this-year-according-nrf

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