Alberta's New Gift Card Regulation
Starting November 1, 2008, gift cards will not be allowed to expire or decline in value the longer they go unused, ensuring gift cards are treated like cash. The Gift Card Regulation, part of Alberta's Fair Trading Act, will:
- Not allow expiry dates on gift cards, gift certificates, and vouchers that have been purchased and have monetary value
- Eliminate inactivity fees, also called dormancy fees, that reduce the value of gift cards the longer they go unredeemed
Not all gift cards and other pre-paid purchase cards are subject to Alberta's Gift Card Regulation. Consumers should ask sellers if the card has any terms or conditions that affect how it can be used. Read this page for more information. - Prevent businesses from not honouring gift cards for purchases that are
more or less than the value of a gift card - Require merchants to fully disclose any restrictions on use of a gift card on
both the actual card and its packaging
See the Gift Card tipsheet (pdf)
Businesses will be allowed to charge a one-time fee on top of the value of the gift
card at the time of purchase, but must fully disclose and clearly explain that fee to consumers. Violations of the new regulation could result in fines as much as
$100,000 or two years in jail.
Listen to a light-hearted advertisement about the new gift card regulation
(audio file opens in new window)
An estimated $1.2 billion in gift cards are sold annually in Alberta, and each year up to $180 million is lost through non-redemption or expiry of the cards.
Does the Gift Card Regulation apply to cards purchased before November 1, 2008?
The new regulation applies to valid gift cards purchased before, on or after November 1. It does not apply to gift cards that expire prior to November 1, 2008.
A retailer explained that I would have to pay a one-time fee at the time of purchasing the gift card on top of the card's value. Is the retailer allowed to do this?
Yes. Businesses can charge a one-time fee when the gift card is purchased, but must fully disclose and clearly explain that fee to consumers.
Does the regulation cover all kinds of gift cards?
No. Alberta’s gift card regulation does not apply if the card is based on a direct agreement between the consumer and the financial institution that issued the card. Depending on the terms and conditions of the card, consumers enter an agreement with the seller either when they purchase the card or use it.
The regulation also does not apply to promotional cards, loyalty cards, phone cards or cards sold for a specific service. For example, a card that entitles a consumer to a manicure and does not have a specific dollar value is not considered a gift card. If it does not have a cash value, it is not covered by the regulation.
What is considered to be a financial institution?
A financial institution is a bank, credit union, trust corporation or treasury branch.
How are gift cards issued by financial institutions different from other gift cards?
Gift cards issued by a financial institution may have an expiry date and fees in addition to the one charged at the time of purchase. These fees are often referred to as maintenance, administration or dormancy fees. Cards that are not from financial institutions can only charge a fee at the time of purchase and do not expire.
Be sure to ask about all of the conditions that apply to the card before buying it.
It is also important to note that the retailer or mall selling the gift card must be able to prove the card holder agreement is between the purchaser/user of the card and the financial institution.
Are gift cards purchased outside Alberta or over the Internet covered under the regulation?
For the regulation to apply, either the consumer or the supplier must be in Alberta when the gift card is purchased. Gift cards purchased over the Internet in Alberta would need to meet that requirement. However, a card purchased outside the province and used in Alberta would not be covered by the regulation.
