According to this summary and this article of the proposed new Federal laws governing credit cards that are now working their way through the House(H.R. 627) and Senate (S.414), at least one of the proposed laws “protects gift cards from most inactivity fees.” How it does so doesn’t appear clear to me from the text of the bill. A Federal law governing gift cards would be a HUGE advancement towards the reasonable legislation of some of the rediculous fees associated with some gift cards. We can only hope that since these bills deal with credit cards, any proposed gift card laws will apply to open-loop (Visa) cards as well as closed-loop ones.

There is another version of the Fair Gift Card Act (S.710) making its way through Congress as well, again introduced by Senators Schumer and Udall. There has been virtually NO press coverage on this bill. This bill DOES apply to both open and closed loop gift cards!

In short, the Fair Gift Card Act specifies

– Cards may not expire in less than 5 years

– No dormancy, inactivity, or service fees except under very restrictive circumstances

– The Federal laws do not supercede any State laws related to gift card expirations and fees.

UPDATE 5/6/09: The gift card provision of the Senate bill is apparently one of the sticking points in rectifying the credit card legislation House and Senate bills. (article)

Update 5/18/09: The Senate passed a version of S.414 that still includes the gift card provisions stated above. The next step is for the Senate and the House to hash out a compromise bill between their two versions. Whether the gift card provisions make it in is anyones guess. (article)

Update 5/20/09: The Senate version of the bill has passed the House and been sent to President Obama for signing. Looks like the gift card provisions are still in it!