---
title: "RETAILERS: New Colorado Consumer Protection Law Requires Redemption of Gift Cards with a Cash Value of $5 or Less"
date: 2010-05-20T17:57:48-04:00
author: Import Bot
canonical_url: "https://www.kelleydrye.com/viewpoints/blogs/ad-law-access/retailers-new-colorado-consumer-protection-law-requires-redemption-of-gift-cards-with-a-cash-value-of-5-or-less"
section: Blog Posts
---
# RETAILERS: New Colorado Consumer Protection Law Requires Redemption of Gift Cards with a Cash Value of $5 or Less

 May 20, 2010

 

 

 

 

 

 

On April 29, 2010, Colorado Governor Bill Ritter signed a [consumer protection bill ](http://www.state.co.us/gov_dir/leg_dir/olls/sl2010a/sl_180.htm)which requires gift card issuers to redeem the card, upon request, if the remaining value is $5 or less. In addition, it bans retailers, restaurants and others from selling gift cards that have any type of fee, including a service fee, a dormancy fee, an inactivity fee or a maintenance fee. This new law will apply to gift cards issued on or after **August 11, 2010**.

Under this law, ​“gift card” is defined as a prefunded tangible or electronic record of a specific monetary value evidencing an issuer’s agreement to provide goods, services, credit, money, or anything of value. A gift card includes a tangible card, electronic card, stored-value card, or certificate or similar instrument, card, or tangible record, all of which contain a microprocessor chip, magnetic chip, or other means for the storage of information and for which the value is decremented upon each use.

A gift card does ***not*** include a prefunded tangible or electronic record issued by, or on behalf of, any government agency, a gift certificate that is issued only on paper, a prepaid telecommunications or technology card, or a card that is donated or sold below face value at a volume discount to an employer or charitable organization for fundraising purposes. Likewise, a card or certificate issued to a consumer pursuant to an awards, loyalty, or promotional program for which no money or other item of monetary value was exchanged is expressly excluded from the definition of a gift card.

In addition, this new law does not apply to gift cards that are usable with multiple sellers of goods or services, but expressly applies to a gift card usable only with affiliated sellers of goods or services.

A violation of this new law will be deemed a violation of Colorado’s deceptive trade practice law.

Once the law is effective, Colorado will join a handful of other states with laws requiring redemption of gift cards with less than a certain cash value. Under California law, as just one example, any gift certificate with a cash value of less than $10 is redeemable in cash for its cash value.

 

 **Tags:** [Consumer Financial Protection](https://www.kelleydrye.com/viewpoints/blogs/ad-law-access/tags/consumer-financial-protection), [Legislative Developments](https://www.kelleydrye.com/viewpoints/blogs/ad-law-access/tags/legislative-developments)

 

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