N.Y. General Business Law Section 396-I
Acceptance of unexpired gift certificates


1.

(a) For the purposes of this section, the following terms shall have the following meanings:

(1)

“gift certificate” shall mean a certificate, electronic card, or other pre-funded record that:

(i)

is usable at a single merchant or an affiliated group of merchants that share the same name, mark, or logo, or is usable at multiple, unaffiliated merchants or service providers; and

(ii)

is issued in a specified amount; and (iii) may or may not be increased in value or reloaded; and

(iv)

is purchased and/or loaded on a prepaid basis for the future purchase or delivery of any goods or services; and

(v)

is honored upon presentation;

(2)

“open loop gift certificate” shall mean a gift certificate redeemable at multiple, unaffiliated merchants or service providers; and

(3)

“promotional gift certificate” shall mean a gift certificate issued for no consideration which includes on the front of the gift certificate (i) a statement indicating that the card is issued for promotional purposes and (ii) the expiration date for the underlying funds.

(b)

Gift certificate shall not include (i) an electronic payment device linked to a deposit account or which is covered by the exclusion set forth in 15 U.S.C. § 1693 L-1(a)(2)(D)(ii), (ii) a fare payment card or electronic payment device used to pay for travel on a public transportation authority system, or (iii) prepaid telephone calling cards regulated under Public Service Law § 92-F (Prepaid telephone calling card consumer protections)section ninety-two-f of the public service law. Gift certificate also shall not include flexible spending arrangements as defined in Section 106(c)(2) of the Internal Revenue Code, 26 U.S.C. § 106(c)(2); flexible spending accounts subject to Section 125 of the Internal Revenue Code, 26 U.S.C. § 125; Archer MSAs as defined in Section 220(d) of the Internal Revenue Code, 26 U.S.C. § 220(d); dependent care reimbursement accounts subject to Section 129 of the Internal Revenue Code, 26 U.S.C. § 129; health savings accounts subject to Section 223(d) of the Internal Revenue Code, 26 U.S.C. § 223(d), as amended by Section 1201 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, Pub. L. No. 108-173; or similar accounts from which, under the Internal Revenue Code and its implementing regulations, individuals may pay medical expenses, health care expenses, dependent care expenses, or similar expenses on a pretax basis. Gift certificate also shall not include a prepaid discount card or program used to purchase identified goods or services at a price or percentage below the normal and customary price; provided that any expiration date of the prepaid discount card or program is clearly and conspicuously disclosed. Gift certificate also shall not include payroll cards or other electronic payment devices which are linked to a deposit account and which are given in exchange for goods or services rendered. 1-a. No person, firm, partnership, association or corporation who or which issues gift certificates or store credits, or who or which conducts a “closing out sale” or “defunct business sale” as such terms are defined in § 581 (Definitions)section five hundred eighty-one of this chapter, of the merchandise of any such person, firm, partnership, association or corporation, shall refuse to accept such gift certificate or store credit in payment for goods or services used or bought for use primarily for personal, family or household purposes, including, but not limited to, goods or services advertised on sale or pursuant to a liquidation or close-out, provided that if the certificates or the terms of the store credits limit the period of time during which they may be used, they are presented for redemption before the expiration of such period of time.

2.

No person, firm, partnership, association or corporation who or which issues gift certificates or store credits, or who or which conducts a “closing out sale” or “defunct business sale” as such terms are defined in § 581 (Definitions)section five hundred eighty-one of this chapter, shall in any manner restrict the holder of a gift certificate or store credit from electing use of such gift certificate or store credit in a manner not inconsistent with stated terms of such gift certificate or store credit, nor shall any person, firm, partnership, association or corporation who or which issues gift certificates or store credits, or who or which conducts a “closing out sale” or “defunct business sale” as such terms are defined in § 581 (Definitions)section five hundred eighty-one of this chapter, alter the term of a gift certificate or store credit after it has been issued. 2-a.

(a)

The terms and conditions of a gift certificate shall be disclosed to the purchaser:

(i)

on a sign conspicuously posted stating “TERMS AND CONDITIONS ARE APPLIED TO GIFT CERTIFICATES/GIFT CARDS”; or

(ii)

conspicuously stated in an offer made by mail thus: “TERMS AND CONDITIONS ARE APPLIED TO GIFT CERTIFICATES/GIFT CARDS”.

(b)

For purchases via electronic, computer, or telephonic means, the statement “TERMS AND CONDITIONS ARE APPLIED TO GIFT CERTIFICATES/GIFT CARDS” shall be stated prior to the customer’s purchase of the gift certificate or conspicuously written within the electronic message offering a gift certificate for purchase.

(c)

All advertisements or promotions for gift certificates shall include a notice in like or similar term to the following: “TERMS AND CONDITIONS ARE APPLIED TO GIFT CERTIFICATES/GIFT CARDS”. 2-b.

(a)

No person, firm, partnership, association or corporation shall sell a gift certificate to a purchaser unless the seller displays a conspicuous notice at or near where the gift certificate is displayed or at or near the physical location where the sale occurs, that (i) cautions the purchaser about prepaid card scams, and

(ii)

instructs the purchaser on what to do if they suspect they might be a potential victim of such a scam.

(b)

The consumer protection division, as established in Executive Law § 94-A (Consumer protection division)section ninety-four-a of the executive law, shall create a model notice which sellers may use to comply with the requirements of this section and shall make such notice accessible to sellers including, but not limited to, posting such notice on the consumer protection division’s website in a format available for sellers to print and display.

3.

The terms and conditions of a gift certificate store credit shall be clearly and conspicuously stated thereon. Terms and conditions including, but not limited to, policies related to refunds, warranties, changes in terms and conditions, the expiration date, if any, the activation fee, if any, the procedure for the replacement of a gift certificate, if any, assignment and waiver shall be conspicuously printed:

(a)

on the gift certificate; or

(b)

on an envelope or packaging containing the gift certificate, provided that a toll free telephone number to access the additional terms and conditions is printed on the gift certificate; or

(c)

on an accompanying document, provided that a toll free telephone number to access the additional terms and conditions is printed on the gift certificate. 3-a. The requirements of subdivisions two-a and three of this section shall not apply to a gift certificate that has no terms and conditions. 3-b. Subparagraph (i) of paragraph (a) of subdivision two-a and subdivision five-a of this section shall not apply to gift certificates:

(a)

sold below face value or at a volume discount to employees, to nonprofit and charitable organizations, or educational institutions for fundraising purposes; or

(b)

distributed to a consumer or employee pursuant to an awards, rewards, loyalty, or promotional program without any consideration being given in exchange for the gift certificate by the consumer or employee. 3-c. Nothing in this section shall be construed to prevent unclaimed funds related to gift certificates from becoming abandoned under section thirteen hundred fifteen of the abandoned property law.

4.

Whenever there shall be a violation of this section, an application may be made by the attorney general in the name of the people of the state of New York to a court or justice having jurisdiction by a special proceeding to issue an injunction, and upon notice to the defendant of not less than five days, to enjoin and restrain the continuance of such violations; and if it shall appear to the satisfaction of the court or justice that the defendant has, in fact, violated this section, an injunction may be issued by such court or justice, enjoining and restraining any further violation, without requiring proof that any person has, in fact, been injured or damaged thereby. In any such proceeding, the court may make allowances to the attorney general as provided in paragraph six of subdivision (a) of Civil Practice Law & Rules Law § 8303 (Additional allowance in the discretion of the court)section eighty-three hundred three of the civil practice law and rules and direct restitution. Whenever the court shall determine that a violation of this section has occurred, the court may impose a civil penalty of not more than one thousand dollars for such violation. In connection with any such application, the attorney general is authorized to take proof and make a determination of the relevant facts and to issue subpoenas in accordance with the civil practice law and rules.

5.

(a) No person, firm, partnership, association or corporation shall charge or assess, or sell or issue any gift certificate subject to, any activation fee, retroactive fee, redemption fee, service fee, dormancy fee, latency fee, administrative fee, handling fee, access fee, periodic fee, renewal fee, re-loading fee, or any other fee of any kind, other than an open loop gift certificate subject to an initial one-time activation or issuance fee reasonably related to the cost of the issuer issuing the open loop gift certificate and which shall in no event be in excess of nine dollars.

(b)

No person, firm, partnership, association or corporation shall sell a gift certificate that has a face value or balance that declines as a result of the passage of time or the dormancy of the gift certificate.

(c)

For the purposes of this subdivision, “dormancy” shall mean non-use of a gift certificate. Use of a gift certificate shall include, but not be limited to, adding value, or purchases. 5-a. It shall be unlawful for any person to sell or issue a gift certificate other than a promotional gift certificate where the underlying funds are subject to an expiration date, provided that a gift certificate may be subject to an expiration date which is not earlier than the later of nine years after the date on which the gift certificate was issued, or the date on which funds were last loaded. The terms of expiration of a gift certificate, if any, shall be clearly and conspicuously stated on such gift certificate. 5-b. A gift certificate, other than an open loop gift certificate or a promotional gift certificate, with a remaining value of less than five dollars may be redeemed upon request for its cash value.

6.

The provisions of this section shall be exclusive and shall preempt any provisions of local law, ordinance or code, and no locality shall impose requirements that are inconsistent with or more restrictive than those set forth in this section.

Source: Section 396-I — Acceptance of unexpired gift certificates, https://www.­nysenate.­gov/legislation/laws/GBS/396-I (updated Jun. 23, 2023; accessed Jun. 15, 2024).

390
Substitution of spurious oils for internal combustion engines
390‑A
Optical discs
390‑B
Anti-phishing act of 2006
390‑BB
Cramming prohibited
390‑C
Prohibit persons under eighteen years of age in certain facilities
390‑C*2
Posting of warnings by commercial entities offering internet access to the public
390‑D
Information concerning services for human trafficking victims in facilities at truck stops
390‑E
Unauthorized installation of certain security devices prohibited
390‑E*2
Skimming awareness notice
391
Marking retreaded, recapped or recut tires
391‑A
Unlawful acts relating to liquid fuels, lubricating oils and similar products
391‑B
Prohibit any sale of dangerous clothing articles
391‑C
Sale of bicycles
391‑D
Sale of matchbooks
391‑E
Promotion of camps by certain organizations
391‑F
Promotion of private schools by certain organizations
391‑G
Rental of motor vehicles
391‑H
Lubricating oils
391‑I
Sale of urea-formaldehyde foam insulation
391‑J
Sale of fire extinguishers
391‑JJ
Sale of electric space heaters
391‑K
Automatic garage door opening systems
391‑L
Personal emergency response service agreements
391‑L*2
Rental of motor vehicles
391‑M
Manufacture and sale of in-line skates
391‑N
Sale of reptiles
391‑OO
Sale of over-the-counter diet pills and dietary supplements for weight loss or muscle building
391‑P
Prohibit the rental of clothing articles previously worn
391‑Q
Rebates
391‑S
Sale and distribution of novelty lighters prohibited
391‑T
Sale of small animals
391‑U
Pricing goods and services on the basis of gender prohibited
391‑U*2
Restrictions on the sale and use of firefighting equipment containing PFAS chemicals
391‑V
Third-party food delivery agreements
392
Second-hand watches
392‑A
Sale of new computers
392‑B
False labels and misrepresentations
392‑C
Obliteration of marks of origin
392‑D
Using false marks as to manufacture
392‑E
Using false statements or altering mileage registering devices
392‑F
Taximeters
392‑G
Sale of ultraviolet radiation devices
392‑H
Trash receptacles
392‑I
Prices reduced to reflect change in sales tax computation
392‑J
Sales of sparkling devices
393
Lime
393‑A
Non fire rated wood paneling
393‑B
Written solicitation
393‑C
Sale of required labor postings
393‑D
Sale of certified copies of property deeds
393‑E
Sale of abandoned property location services
393‑F
Voluntary third-party notification
394
Lost or destroyed certificate of stock
394‑A
Proof of lost negotiable paper
394‑B
Limitations on certain contracts for instruction or use of physical or social training facilities
394‑C
Limitations on certain contracts involving social referral services
394‑CC
Internet dating safety
394‑CCC
Social media networks
394‑D
Privity of contract between franchise seller and customer or patron of dealer
394‑E
Report on request for abortional services
394‑F
Warrants for reproductive health related electronic data
395
Required disclosure of prior use
395‑A
Maintenance agreements
395‑B
Unlawfully installing or maintaining a two-way mirror or other viewing device
396
Unlawful selling practices
396‑A
Representation by savings and loan association of insurance on accounts
396‑AA
Simulated check
396‑AA*2
Unsolicited telefacsimile advertising
396‑AAA
Public display of tobacco and electronic cigarette advertisements and smoking paraphernalia prohibited
396‑B
Advertisements
396‑BB
Sale of motor fuels to disabled persons
396‑C
Advertisements by persons engaged in dental business relating to dentures and bridges
396‑CC
Notification of enclosure requirements for swimming pools
396‑CC*2
Senior citizen discounts
396‑D
Advertisement and description of real property
396‑DD
Renting of horses
396‑E
Marking articles made of linen
396‑EE
Sale of certain weapons
396‑EEE
Unlawful sale or delivery of body armor
396‑F
Sale of blind made products
396‑G
Sale of products processed by the blind
396‑H
Fraudulent sale of poppies, forget-me-nots, daisies, flags and other articles sold for patriotic purposes
396‑HH
Sale of poppies, forget-me-nots, daisies, flags and other articles for patriotic purposes
396‑I
Acceptance of unexpired gift certificates
396‑J
Sale or possession of master or manipulative keys for motor vehicles
396‑K
Hazardous toys and other articles intended primarily for use by children
396‑K*2
Sale of certain motor vehicles damaged by the ravages of natural disaster
396‑KK
Sale of video game consoles
396‑L
Shopping carts
396‑M
Mail-order or telephone-order merchandise
396‑MM
Unlawful trial offers
396‑N
Sales with “money back guarantee” and with “limited guarantee”
396‑O
Sales by persons offering credits or refunds in certain cases
396‑P
Rates to be posted in taxicabs
396‑P*2
Contracts for the sale of new motor vehicles
396‑Q
New motor vehicles
396‑QQ
New and used motor vehicles
396‑R
Price gouging
396‑RR
Price gouging
396‑S
Individual sewage disposal system
396‑SS
Access number notification
396‑T
Unlawful practices relating to layaway plans
396‑TT
Listing of business location in directory or database
396‑U
Merchandise delivery
396‑V
Operation of public automated blood pressure machines
396‑W
Loitering for the purpose of soliciting passengers for transportation
396‑X
Gasoline stations
396‑X*2
Unauthorized removal or destruction of newspapers
396‑Y
Sale of certain personal property
396‑Z
Rental vehicle protections
397
Unlawful use of name or other identification of certain non-profit organizations
397‑A
Distributing unsolicited advertising on private property prohibited
397‑B
Digital billboards
398
Bills of lading to be issued by vessels transporting merchandise within the state
398‑A
Shipment of motor vehicles outside the continental United States
398‑B
Discrimination in car rentals prohibited
398‑C
Children attending roller skating rinks and indoor ice skating rinks under certain conditions
398‑D
Disposal of abandoned molds
398‑E
Indemnity provision in motor carrier transportation contracts
398‑F
Children’s non-regulated camp
399
Cigarette package labeling
399‑A
Pay toilets
399‑AA
Prohibition of the selling of fur, hair, skin or flesh of a dog or cat
399‑AAA
Selling and manufacturing of fur-bearing articles of clothing
399‑AAAA
Menstrual product labeling
399‑AAAAA
Selling of animal tested cosmetics
399‑B
Contracts for the use of the streets for hack stands
399‑BB
Certain dry cleaning institutions
399‑BBB
Solicitations by container
399‑C
Mandatory arbitration clauses in certain consumer contracts prohibited
399‑CC
Wireless telephone numbers
399‑CC*2
Transcripts and stenographic services
399‑CCC
Smoke detecting devices
399‑CCCC
Wireless telephone services
399‑D
Children attending public bowling alleys under certain conditions
399‑DD
Sale of alcohol vaporizing devices prohibited
399‑DD*2
Construction or installation of playground or playground equipment
399‑DD*3
Consumer communications records privacy
399‑DDD
Confidentiality of social security account number
399‑DDD*2
Disclosure of social security number
399‑E
Prohibition of the importation, manufacturing, distribution, or sale of yo-yo waterball toys
399‑E*2
Actions
399‑EE
Zone pricing of gasoline prohibited
399‑F
Laundromat refund procedures
399‑FF
Petting zoos
399‑GG
Packaging of electronic liquid
399‑H
Disposal of records containing personal identifying information
399‑I
Prohibit the sale of unsafe cribs and restrict use of such cribs in certain settings
399‑II
Furniture tip restraint device
399‑II*2
Prohibit the sale of crib bumper pads and restrict use of such pads in certain settings
399‑J
Safety standards
399‑K
Access to toilet facilities for utility workers
399‑M
Disclosures in advertisement and sale of unassembled goods
399‑N
Approval of electrical devices
399‑NN
Sale of digital electronic equipment
399‑O
Selling prices and container deposits
399‑OO
Deceptive solicitation of vehicle warranty policies
399‑P
Telemarketing
399‑PP
Telemarketing and consumer fraud and abuse prevention act
399‑Q
Use of carts, cases, trays, baskets, boxes and other containers
399‑QQ
Sale or promotional distribution of utility knives, box cutters, or box cart cutters
399‑R
Sale of paint pellet guns
399‑RR
September eleventh victim compensation fund and World Trade Center health program notification
399‑S
Posting of notice when air rifles or guns are sold
399‑T
Sale of certain chlorofluorocarbons and halons prohibited
399‑T*2
Vending machine disclosure
399‑U
Motor vehicle alarms
399‑V
Parking facilities
399‑W
Total loss notice and waiver of the gap amount for non-motor vehicle retail lease agreements
399‑W*2
Notice requirements for renters of personal property
399‑X
Towed motor vehicles
399‑XX
Towing of motor vehicles
399‑Y
Child safety devices for hot water dispensers
399‑Y‑1
Automated teller machines transaction denial
399‑Y*2
Automated teller machine fee disclosure
399‑YY
Cable television company providing telephone services
399‑YYY
Satellite television company providing television and/or telephone services
399‑Z
Telemarketing
399‑Z‑1
Telecommunication companies blocking certain numbers
399‑Z‑1*2
STIR/SHAKEN authentication framework
399‑ZZ
Telephone bills
399‑ZZZ
Prohibition of certain fee charges
399‑ZZZZ
Prohibition of certain fee charges for termination or early cancellation
399‑ZZZZZ
Broadband service for low-income consumers
399‑ZZZZZ*2
Use of preferred name and pronouns

Accessed:
Jun. 15, 2024

Last modified:
Jun. 23, 2023

§ 396-I’s source at nysenate​.gov

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