Your Personal Finances

Consumer Alert

If you received gift cards for Christmas, you don't necessarily have to be in any hurry to use them. Several provinces have regulations that ban expiry dates on most retail gift cards.

Ontario and Manitoba's bans on expiry dates for retail store gift cards and activation or dormancy fees came into effect in 2007. Alberta's rule came into effect on November 1, 2008.

The Alberta government says about $1.2 billion in gift cards are sold in Alberta each year. Almost $180 million is lost to consumers annually through non-redemption or expiry of the cards.

"Gift cards have become incredibly popular in our province and we want to make sure Albertans get what they pay for," said Heather Klimchuk, Minister of Service Alberta. "This new regulation will ensure that if a consumer buys a $50 gift card, it will be worth $50 no matter when it is redeemed."

"Gift cards have become incredibly popular in our province and we want to make sure Albertans get what they pay for," said Heather Klimchuk, Minister of Service Alberta. "This new regulation will ensure that if a consumer buys a $50 gift card, it will be worth $50 no matter when it is redeemed."

The regulation also eliminates inactivity or dormancy fees reducing the value of the gift the longer the card goes unredeemed.

In September 2008 the Ontario government extended its rules to gift cards from malls, but the regulations are different. If you buy a mall gift card you could pay up to $1.50 for a one-time activation fee. After 18 months, the cards can start charging a $2.50 per month dormancy fee. Cards or certificates that are redeemable for specific services, such as a massage at a spa are not covered. These rules are similar in Manitoba as well.

The Ontario government has issued a gift card warning about a mass email that is circulating warning consumers to use or lose their gift cards. Ontario's Ministry of Small Business and Consumer Services says that if you hold a gift card for a company that goes out of business due to bankruptcy, you basically have to turn to the company's trustee in bankruptcy to see if there is any chance of getting your money back.

The Ministry says consumers are always encouraged to be smart, informed consumers by using their gift cards promptly. Remember, gift cards are as good as cash, the Ministry warns. So the bottom line is that you don't necessarily have to use your cards right away – they won't expire. However, if the company goes out of business, you are out of luck – and out of pocket.

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