2012 -- S 2071

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LC00409

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2012

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A N A C T

RELATING TO COMMERCIAL LAW - GIFT CERTIFICATES

     Introduced By: Senator Roger Picard

     Date Introduced: January 18, 2012

     Referred To: Senate Corporations

It is enacted by the General Assembly as follows:

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     SECTION 1. Section 6-13-12 of the General Laws in Chapter 6-13 entitled "Unfair Sales

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Practices" is hereby amended to read as follows:

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     6-13-12. Sales of gift certificates. -- "Gift certificate" means a record evidencing a

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promise, made for monetary consideration, by the seller or issuer for the record that goods or

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services will be provided to the owner of the record to the value shown in the record and includes,

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but is not limited to, a record that contains a microprocessor chip, magnetic strip or other means

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of storage of information that is pre-funded and for which the value is decremented upon each

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use, a gift card, an electronic gift card, stored-value card or certificate, a store card, prepaid long

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distance telephone service that is activated by a prepaid card that requires dialing an access

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number or an access code for each call in addition to dialing the phone number to which the user

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of the prepaid card seeks to connect, or a similar record or card. Any person, firm, or corporation

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that sells gift certificates for any product or merchandise sold by the person, firm, or corporation,

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shall be required to record the sales and keep an accurate and complete record of each gift

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certificate sold. The record shall include the date of sale, the full value of the certificate, the

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identification number assigned by the retailer to the certificate, and the state in which the sale of

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the certificate took place. The retailer shall further be required to give to the purchaser of gift

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certificates exceeding fifty dollars ($50.00) a written and numbered receipt evidencing the sale of

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the certificate. It shall be unlawful for any person, firm, or corporation of any kind to charge any

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surcharge or additional monthly or annual service or maintenance fees on gift certificates or to

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limit the time for the redemption of a gift certificate or to place an expiration date upon the gift

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certificate. No gift certificate or any agreement with respect to such gift certificate may contain

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language suggesting that an expiration date may apply to the gift certificate. All gift certificates

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shall retain their full value for three (3) years from the date of the sale of the gift certificate. After

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the passage of three (3) years from the date of sale, a person, firm or corporation may decrease

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the value of the gift certificate by no more than ten percent (10%) of the gift certificate's value for

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each year in which a gift certificate remains, fully or partially unredeemed.

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     Any person, firm, or corporation that shall violate the provisions of this section shall be

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punished by a fine of not more than two hundred dollars ($200). Due to the unlimited redemption

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period, the The division of taxation shall not escheat the funds paid for those unredeemed gift

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certificates. Any unused portion of a redeemed gift certificate shall be afforded to the consumer

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by reissuing the gift certificate for the unused amount or providing cash where the balance due

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the consumer is less than one dollar ($1.00). This section shall not apply to the following:

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     (a) Gift certificates that are distributed to a consumer pursuant to an awards, loyalty or

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promotional program without any money or other thing of value being given in exchange for the

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gift certificate by the consumer. Any restrictions or limitations which such gift certificates may be

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subject to must be disclosed to the consumer, in writing, at the time the gift certificates are

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distributed to the consumer.

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      (b) Prepaid wireless telephone service or prepaid wireless telephone card. "Prepaid

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wireless telephone service" means wireless telephone service that is activated in advance by

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payment for a finite dollar amount of service or for a finite set of minutes that terminate either

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upon use by a customer and delivery by the wireless provider of an agreed-upon amount of

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service corresponding to the total dollar amount paid in advance or within a certain period of time

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following the initial purchase or activation, unless additional payments are made.

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      (c) Gift cards or prepaid or store value cards that are issued by state-chartered financial

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institutions and credit unions or that are issued by third-party issuers usable at multiple,

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unaffiliated merchants or service providers, provided that said financial institutions, credit unions

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or third-party issuers comply with the guidelines on disclosure and marketing as published by the

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office of the comptroller of the currency.

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     SECTION 2. This act shall take effect upon passage.

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LC00409

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO COMMERCIAL LAW - GIFT CERTIFICATES

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     This act would require that gift certificates remain redeemable at their full value for three

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(3) years, after which the value of the gift certificate may be decreased by no more than ten

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percent (10%) per year.

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     This act would take effect upon passage.

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LC00409

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