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Thursday, March 16, 2006

Ohio exempts Visa and Mastercard from new gift card law

The Ohio Legislature has passed Subustitute Senate Bill 33 which is still, as of today, awaiting Governor Taft's signature. The law, if signed (check here for updates), states that no person can sell a gift card with an expiration date of less than 2 years of issuance and prohibits charging maintenance or service fees within those two years.

However, the law has seven exemptions to these prohibitions. Number six exempts "a gift card that is usable with multiple, unaffiliated sellers of goods or services." In essence, those typically issued by Visa and Mastercard.

Sheryl Harris, a Cleveland Plain Dealer columnist, says don't blame the Bill's sponsor, Sen. Bob Spada (R).

Spada introduced a spare bill with few exceptions and then for two years fought off gift-card issuers' attempts to kill it.

But the exemption was inserted after the bill moved to the House and is contained in the final version.

Hopefully, as Ms. Harris concludes, "when the Ohio legislature becomes more interested in looking out for consumers than for special interests, it will polish this law into the bill Spada envisioned."

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