Tuesday, February 27, 2024

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House bans gift certificates with expiry date

The House of Representatives this week unanimously approved on third and final reading House Bill 6016 that seeks to regulate the issuance, use and redemption of gift checks, gift cards and gift certificates.

House Bill No. 6016, otherwise known as the “Gift Check Non-Expiry Act,” makes it unlawful for any issuer to issue or sell a gift check, gift certificate and card gift that contains an expiry date.

The bill is in line with the policy of the State to protect the interest of the consumer, promote the general welfare and establish standards of conduct for business and industry.

Consistent with this policy, the State shall promote and encourage fair, honest, and equitable relations among parties in consumer transactions and protect consumers against deceptive, unfair and unconscionable sales acts and practices.

To achieve this purpose, the State, through the Department of Trade and Industry (DTI) recognizes that a gift check, gift certificate, and gift card represent value held in trust by the issuer thereof on behalf of its beneficiary or bearer and as such, consumers must not be unduly deprived of the value of their money.

Rep. Winston Castelo (2nd District, Quezon City), principal author of the bill, said it is a well-acceptable view that since such check, certificate or card is bought with money, it must also be redeemable until used up by the holder or owner.

“Money does not expire unless it is already demonetized which rarely happens. So the same must apply to a gift certificate, check or card,” Castelo said.

Under the bill, the terms “Gift Check, Gift Certificate, and “Gift Card” refer to instruments issued to an individual, partnership, or a juridical entity for monetary consideration honored at a single merchant or an affiliated group of merchants as payment for consumer goods or services provided by such merchant or affiliated group of merchants upon presentation of said gift check, gift certificate, and gift card to the extent of the value, credit, or balance stored in the instrument.

The proposal prohibits the imposition of an expiry date on the stored value, credit, or balance in the gift check, gift certificate and gift card.

The gift check, gift certificate and gift card shall remain valid until the cessation of business of the issuer.

The gift check, gift certificate and gift card shall be sold at a discount of five percent percent from its face value by the juridical entity who issues or sells the gift check, gift certificate and gift card for which consumer goods or services will be exchanged.

The gift check, gift certificate and gift card that is sold at a discount shall not be used for the purchase of groceries.

A gift check, certificate and card that is issued to a consumer under an award, loyalty or promotional program is not covered under the bill.

An issuer may refuse to honor the gift check, gift certificate and gift card is when it is mutilated or defaced due to no fault of the issuer.


Another instance an issuer may refuse to honor the same is when it is lost due to no fault of the issuer as well.

The bill states promotional sales activities, loyalty programs, warranties, return policies for cash purchase and discounts for senior citizens and persons with disability as provided under relevant laws and regulations shall apply likewise to purchase of goods and services that are paid for with gift check, gift certificate and gift card.

Upon the effectivity of this Act, all gift checks already issued shall be covered by the provisions of this Act.

The measure imposes, upon conviction, the penalty of imprisonment of not less than one year but not more than five years and fine of not less than P500,000 but not more than P1 million, or both, upon the discretion of the court, to any person who violates the provisions of this Act or its implementing rules and regulations.

The bill is authored by Reps. Jose Antonio Sy-Alvarado (1st District, Bulacan), Gus Tambunting (2nd District, Parañaque City), John Marvin Nieto (3rd District, Manila), Ferjenel Biron (4th District, Iloilo), Xavier Jesus Romualdo (Lone District, Camiguin), Rosanna Vergara (3rd District, Nueva Ecija), Manuel Zubiri (3rd District, Bukidnon), Mark Go (Lone District, Baguio City), Teodoro Montoro (Party-list, AASENSO), Henry Ong (2nd District, Leyte), Manuel Sagarbarria (2nd District, Negros Oriental), Abdullah Dimaporo (2nd District, Lanao del Norte), Arlene Arcillas (1st District, Laguna), Lorna Silverio (3rd District, Bulacan), Lucy Gomez (4th District, Leyte), Maximo Rodriguez Jr. (2nd District, Cagayan de Oro City), Jerry Treñas (Lone District, Iloilo City), Franz Alvarez (1st District, Palawan), Rene Relampagos (1st District, Bohol), Jose Christopher Belmonte (6th District, Quezon City), Jocelyn Limkaichong (1st District, Negros Oriental), Maria Lourdes Acosta-Alba (1st District, Bukidnon), Deogracias Victor Savellano (1st District, Ilocos Sur), Carlo Lopez (2nd District, Manila), Juliette Uy (2nd District, Misamis Oriental), Jose Enrique Garcia (2nd District, Bataan), Francis Gerald Abaya (1st District, Cavite), Sabiniano Canama (Party-list, COOP-NATCCO), Ben Evardone (Lone District Eastern Samar), Paolo Javier (Lone District, Antique), Mercedes Cagas (Lone District, Davao del Sur), Seth Frederick Jaloslos (1st District, Zamboanga del Norte), Yedda Marie Romualdez (1st District, Leyte), Isidro Rodriguez (2nd District, Rizal), Ramon Durano VI (5th District, Cebu), Dennis Laogan (Party-list, ANG KABUHAYAN) Michael John Duavit (1st District, Rizal), Rodante Marcoleta (Party-list, SAGIP), Raul Tupas (5th District, Iloilo), Raymond Democrito Mendoza (Party-list, TUCP), Cecilia Leonila Chavez (Party-list, BUTIL),Richard Eusebio (Lone District, Pasig City), Marlyn Primicias-Agabas (6th District, Pangasinan), Manuel Jose Dalipe (2nd District, Zamboanga City), Gerald Anthony GullasJr. (1st District, Cebu) and Edgar Mary Sarmiento (1st District, Samar). | (MVIP/CONGRESS)

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