NY Gen Bus L § 396-I (2021)
2021 New York Laws GBS - General Business Article 26 - Miscellaneous 396-I - Acceptance of Unexpired Gift Certificates.

§  396-i.  Acceptance  of  unexpired  gift  certificates.  1.  For the purposes of this  section,  "gift  certificate"  shall  mean  a  written promise  or  electronic  payment  device 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. Gift certificate shall not include an electronic payment device linked  to  a deposit  account,  or  prepaid  telephone  calling cards regulated under 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  the  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 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 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  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".   3.  The  terms and conditions of a gift certificate store credit shall be clearly and conspicuously stated thereon. Terms and conditions  shall include  the  expiration date, whether any fees are assessed against the balance of the gift certificate, and whether a fee will be  charged  for the  replacement  of  a  gift  certificate  that  is  lost,  stolen,  or destroyed, if any. Additional terms and conditions  including,  but  not limited  to,  policies  related to refunds, warranties, changes in terms and conditions, 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 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  retroactive  fees  shall  be  assessed  against  a  gift certificate.  (b) No monthly service fees may be assessed against the balance  of  a gift certificate prior to the twenty-fifth month of dormancy.  (c)  A  service  fee  may be assessed after the twenty-fourth month of dormancy provided that any  such  fee  shall  be  waived  and  the  gift certificate  replenished  to its value prior to such fees being assessed where the holder of  such  gift  certificate  presents  the  certificate within three years of issue.  (d)  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 where the underlying funds are subject to an expiration date which is earlier than five years  after  the  date  on  which  the  gift certificate was issued, or the date on which funds were last loaded to a store   gift  card.  The  terms  of  expiration  shall  be  clearly  and conspicuously stated on the gift certificate.   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.