Duterte signs law prohibiting expiration of gift certificates

December 29, 2017

President Rodrigo Duterte has approved a law prohibiting issuance of gift checks that bear expiry dates, as well as imposing an expiry date on the stored value, credit, or balance of the gift check.

Republic Act No. 10962, otherwise known as the “Gift Check Act of 2017," signed on December 19 but announced Friday, said it is also unlawful to refuse to honor the unused value, credit, or balance stored in the gift check.

RA No. 10962, which regulates the issuance, use, and redemption of gift checks, is pursuant to the government’s policy of safeguarding the interests of Filipino consumers and establishing proper standards of conduct for businesses in the country.

The new law also protects consumers against deceptive, unfair, and unconscionable sales acts and practices.

It further seeks to promote “fair, honest, and equitable relations among parties in consumer transaction.”

“Towards this end, the State, through the Department of Trade and Industry (DTI), recognizes that a gift check represents value held in trust by the issuer thereof on behalf of its beneficiary or bearer and that consumers must not be unduly deprived of the value of their money,” RA No. 10962 read.

The law applies to all issuers of gift checks, gift certificates, or gift cards, may they be in the form of paper, card, code, or other device.

However, gift checks that are issued to consumers including, but not limited to, those under loyalty, rewards, or promotional programs, as determined by the DTI, are not covered by the law.

Coupons or vouchers -- those which entitle holders to a discount off a particular good or which may be exchanged for a pre-identified good -- are likewise not covered by RA 10962.

Any person, natural or juridical who violates the law shall be obligated to return the unused balance of the gift check within 90 days from the declaration of the violation by the DTI and shall be subject to a fine to be imposed by the trade secretary, which shall in no case be less than P500,000 nor more than P1 million.

For the second offense, in addition to the fine, the issuance of the gift check by the offending issuer shall be suspended for three months.

For the third offense, in addition to the fine, the issuance of gift check by the offending issuer shall be cancelled.

The DTI shall have the exclusive jurisdiction to implement the new law.

After consultation with stakeholders, the DTI shall promulgate within 90 days from the effectivity of the act the rules and regulations necessary for its effective implementation.

The act shall take effect 15 days after its publication in at least two newspapers of general circulation. Celerina Monte/DMS