Leawood, Kan. – September 22, 2023: The California Assembly and Senate have passed Senate Bill 728 and all related amendments (“SB 728”) and the bill will move to the Governor for review. If enacted, SB 728 would prohibit the sale or distribution of plastic gift cards in California, with limited exceptions. 2023 SB 728(b) & (e). SB 728 applies to gift cards sold on or after January 1, 2027. 2023 SB 728(b). However, the bill authorizes a retailer to continue to sell or distribute “an existing stock of plastic gift cards that were acquired before January 1, 2027, until January 1, 2028.” 2023 SB 728(c). It also exempts plastic cards “used to pay public transit fares.” 2023 SB 728(e).
As currently written, gift cards have the same definition of gift certificates as defined in Section 1749.45 of the Civil Code. 2023 SB 728(a). Section 1749.45(a) of the Civil Code provides, “[a]s used in this title, ‘gift certificate’ includes gift cards, but does not include any gift card usable with multiple sellers of goods or services, provided the expiration date, if any, is printed on the card. This exemption does not apply to a gift card usable only with affiliated sellers of goods or services.”
SB 728 does provide for civil penalties. Specifically, it provides: “[t]he Attorney General, a district attorney, a county counsel, or a city attorney may enforce this section. The first violation shall be punishable by a civil penalty of twenty-five dollars ($25) per retailer for the day the violation occurs. A subsequent violation shall be punishable by a civil penalty of one hundred dollars ($100) per retailer for each day the violation occurs. A civil penalty collected pursuant to this subdivision shall be paid to the entity that brought the action.” 2023 SB 728(d).
To read California Senate Bill 728, click here: California Senate Bill 728.
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