Federal Register / Vol. 78, No. 80 / Thursday, April 25, 2013 / Notices 24391 

35Similarly, the Bureau concludes that its 

determination that § 66–29–116 of the Tennessee 

Act is not more protective of consumers than the 

EFTA and Regulation is not inconsistent with the 

judicial decision discussed in the Bureau’s Notice. 

That case, in which the U.S. Court of Appeals for 

the Third Circuit upheld a decision by the U.S. 

District Court for the District of New Jersey that 

declined to preliminarily enjoin the application to 

gift cards of New Jersey’s unclaimed property law, 

weighed the benefits to consumers of New Jersey’s 

unclaimed property scheme for gift cards. In finding 

that the plaintiffs were unlikely to prove that 

Federal law preempted New Jersey’s unclaimed gift 

card law, the court emphasized several possible 

benefits to consumers of having their unused gift 

card value transfer to the State that, in the court’s 

view, weighed in favor of a conclusion that New 

Jersey law was more protective of consumers than 

the EFTA and Regulation E. See N.J. Retail 

Merchants Ass’n v. Sidamon-Eristoff, 669 F.3d 374 

(3d Cir. 2012), reh’g denied (3d Cir. Feb. 24, 2012). 

Because the Bureau’s preemption determination 

with respect to Tennessee law applies to the 

provision of Tennessee law that permits issuers to 

decline to honor abandoned gift cards at the pointof-sale, rather than to the provision that requires 

unused gift card value to be transferred to the State, 

the purported benefits of any such transfer are not 

germane to the Bureau’s decision. 

36The Bureau’s determination with respect to the 

Tennessee Act reflects the Bureau’s understanding 

of how the Tennessee Act currently operates and is 

based in part on communications with the 

Tennessee Department of Treasury’s Unclaimed 

Property Division. If legislative, judicial, or other 

official action effected a relevant change in how 

Tennessee law applied to gift cards, the Bureau 

could revisit its determination. 

liability to consumers for the property, 

the effect of this provision is to permit 

cards and their underlying funds to 

expire sooner than is permitted under 

the EFTA and Regulation E. Section 66– 

29–116 of the Tennessee Act thus 

permits an act or practice that is 

prohibited by the Federal law. 

In reaching this conclusion, the 

Bureau has considered whether § 66– 

29–116 of the Tennessee Act, as applied 

to gift cards, is more protective of 

consumers than Federal law. The 

Bureau has concluded that it is not, 

because the Bureau has not identified 

any consumer benefit flowing from an 

issuer’s ability to decline a gift card at 

the point-of-sale sooner than the card 

and its underlying funds are permitted 

to expire under Federal law. The Bureau 

notes that any benefits a consumer 

might experience from having a gift card 

treated as abandoned property would 

result from the transfer of the unused 

gift card value to the State, not from an 

issuer’s declining to honor the card.35

For the reasons stated above, the 

Bureau finds that the Tennessee Act is 

inconsistent with the EFTA and 

Regulation E and therefore is preempted 

to the extent that it permits issuers to 

refuse to honor gift cards sooner than 

the gift cards and their underlying funds 

are permitted to expire under Federal 

law.36 In reaching this determination, 

the Bureau acknowledges commenters’ 

concerns that the requirement both to 

transfer the unused value from 

abandoned gift cards to the State while 

at the same time complying with the 

EFTA and Regulation E imposes 

possibly burdensome obligations on gift 

card issuers. However, the primary 

concern of the relevant provision of the 

EFTA is to ensure that consumers will 

be able to use their gift cards for the 

prescribed periods of time. So long as 

consumers can continue to use their 

cards at the point-of-sale for as long as 

Federal law guarantees, the fact that 

issuers may face an increased burden or 

cost to comply with both Federal law 

and the Tennessee Act—at least to the 

degree of burden the commenters 

discussed—does not change the 

Bureau’s conclusion. Also, as with 

Maine, the Bureau expresses no opinion 

on the constitutional due process 

concerns raised by certain commenters, 

because the Bureau’s role is solely to 

determine whether State law 

inconsistent with the requirements of 

the EFTA and Regulation E, not to 

determine whether State law is 

constitutional. In this regard, the Bureau 

notes that its determination is limited to 

the conclusion that § 66–29–116 of the 

Tennessee Act, as applied to gift cards, 

is preempted, and the Bureau does not 

otherwise opine on how the Tennessee 

Act should apply to gift cards in light 

of this determination. 

This is an official staff interpretation 

of Regulation E, issued pursuant to 

§ 1005.12(b) of Regulation E. The 

Bureau believes that the nuances of 

States’ unclaimed property laws warrant 

independent consideration of whether a 

particular State’s unclaimed property 

law as applied to gift cards is 

inconsistent with and preempted by the 

EFTA and Regulation E. Thus, 

notwithstanding certain commenters’ 

requests that the Bureau set forth a 

uniform, national standard, this 

determination is limited to the facts and 

issues discussed above and does not 

constitute a determination with respect 

to the laws of any other States. 

List of Subjects 

12 CFR Part 1005 

Banking, Banks, Consumer protection, 

Credit unions, Electronic fund transfers, 

National banks, Remittance transfers, 

Reporting and recordkeeping 

requirements, Savings associations. 

Preemption Determination 

The following order sets forth the 

preemption determination, which also 

will be reflected in Supplement I to Part 

1005—Official Interpretations. 

Order 

Pursuant to § 1639q of the Electronic 

Fund Transfers Act (EFTA) and 

§ 1005.12(b) of Regulation E, the Bureau 

has determined that § 66–29–116 of 

Tennessee’s Uniform Disposition of 

Unclaimed (Personal) Property Act (the 

Tennessee Act) is preempted by the 

EFTA and Regulation E to the extent 

that the Tennessee Act permits gift 

certificates to be declined at the pointof-sale sooner than the gift certificates 

and their underlying funds are 

permitted to expire under § 1005.20(e) 

of Regulation E. The Bureau’s 

determination applies only with respect 

to those devices that are gift certificates, 

store gift cards, and stored-value cards, 

as defined in 12 CFR 1005.20(a), and are 

also covered by the Tennessee Act. 

Dated: April 19, 2013. 

Richard Cordray, 

Director, Bureau of Consumer Financial 

Protection. 

[FR Doc. 2013–09751 Filed 4–24–13; 8:45 am] 

BILLING CODE 4810–AM–P 

CONSUMER PRODUCT SAFETY 

COMMISSION 

Sunshine Act Meeting Notice 

TIME AND DATE: Wednesday, May 1, 

2013, 10:00 a.m.–11:00 a.m. 

PLACE: Room 420, Bethesda Towers, 

4330 East West Highway, Bethesda, 

Maryland. 

STATUS: Commission Meeting—Open to 

the Public. 

MATTERS TO BE CONSIDERED: Decisional 

Matter: Section 1110 Certificates of 

Compliance—Notice of Proposed 

Rulemaking. 

A live webcast of the Meeting can be 

viewed at www.cpsc.gov/live. 

For a recorded message containing the 

latest agenda information, call (301) 

504–7948. 

CONTACT PERSON FOR MORE INFORMATION: 

Todd A. Stevenson, Office of the 

Secretary, U.S. Consumer Product 

Safety Commission, 4330 East West 

Highway, Bethesda, MD 20814, (301) 

504–7923. 

Dated: April 23, 2013. 

Todd A. Stevenson, 

Secretary. 

[FR Doc. 2013–09925 Filed 4–23–13; 4:15 pm] 

BILLING CODE 6355–01–P 


tkelley on DSK3SPTVN1PROD with NOTICES