Gift card rules
For gift cards sold in California, Massachusetts and New Hampshire expiration is prohibited by law.
California Bans Most Service Fees on Gift Certificates
Gift cards, a form of electronic gift certificates, are proliferating. The Wall Street Journal estimated in Feb. 2003 that $36 to $38 billion in gift cards were sold in 2002, and that the amount of money left unused on gift cards is $2 billion a year and growing. Some retailers now impose a monthly service fee on gift cards which are not fully spent after a specified time, such as one or two years.
A new law going into effect January 1, 2004 in California bans nearly all service fees on retailer gift cards and gift certificates. The new law bans service fees, with one limited exception. On a rechargeable card with a balance of $5 or less, the issuer may charge a dormancy fee of $1 per month after 24 months of inactivity. Even a balance inquiry counts as activity that prevents this fee. All other service fees are prohibited.
The new law applies to gift certificates sold on or after January 1, 2004. Under preexisting California law, gift certificates may not expire.