Niall Collins (Limerick County, Fianna Fail) | Oireachtas source

I am delighted that the Consumer Protection (Amendment) Bill 2017 is being discussed by the Joint Committee on Business, Enterprise and Innovation following the successful passage of this Bill on Second Stage in the Dáil last June. The Bill was passed with cross-party support in the Chamber that evening. I will reiterate many of the points I raised on that occasion again today.

This is a pro-consumer initiative and will greatly enhance consumer protections and rights in the unregulated area of the sale of gift vouchers and their terms and conditions and enhance transparency in this regard. This legislative proposal will ensure Irish consumers can select a gift card or voucher at their own discretion and have full access to the terms and conditions of the product they are buying. They will also have the certainty that the product they are buying will last for a certain period of time. Gift cards which are e-money products are subject to regulation and protections under EU electronic money directives, EU anti-money laundering laws and EU payments services directives. That is an important distinction which I wish to make at the outset. However, gift vouchers and gift cards remain mainly unregulated in Ireland, with approximately two thirds of the market completely unregulated according to industry estimates.

The unregulated sector concerns mainly shopping centre cards and single-brand store cards. Furthermore, there is no protection of funds loaded on cards. Retailers can use such funds as normal working capital and if a retailer collapses the funds are lost to consumers. Finally, there is no consumer protection legislation for these unregulated gift cards and vouchers governing expiry dates, mandatory requirements on transparency, security of funds or fees charged. This is very concerning during the busy shopping period when peak shopping takes place. For example, Christmas is one of the busiest times of the year for the sale of gift vouchers. However, consumers receiving the gift vouchers can often be left unawares regarding the terms and conditions that apply. Specifically, the period of time for which vouchers remain valid can vary. As a result, consumers are left shortchanged when they go to redeem them. It is fair to say that some retailers are more flexible than others but currently they have the right to refuse to honour the voucher outside of the defined period.

During the last seven years successive Governments have failed to protect consumers by not enacting consumer protection legislation to regulate gift vouchers. This was acknowledged in the heads of a 2015 Government consumer rights Bill that has remained in limbo since then. The heads of that Bill state “the proposals in [this] Chapter are the first legislative provisions to deal specifically with these products”, that is gift vouchers.

My Bill provides for new provisions to regulate the sale of gift vouchers and the contracts for their supply by amending the Consumer Protection Act 2007. The Bill establishes a definition for gift vouchers. This takes in all types of such products whether they are cards, written certificates or in electronic or other formats. For the first time in Irish consumer law, the Bill proposes that there can be no expiry date on gift vouchers “which is not less than a five year period”. In other words, all gift vouchers would remain valid for five years. This five-year expiry date has been deployed in other jurisdictions to good effect. Moreover, under this Bill an obligation is imposed on the trader to inform the consumer of any fees associated with the sale of the voucher before the consumer is bound by the gift voucher contract. Gift voucher contracts can provide for restrictions on their use. The Bill enhances consumer protections by providing that a consumer must be informed of any restrictions associated with a gift voucher before being bound by any such contract.

I acknowledge the work of other parties in this area and I hope all parties can work together in the Oireachtas to progress this legislation to Committee Stage swiftly as it represents the most advanced proposal currently in the legislative process. Under successive Governments there has been no movement on the 2015 heads of a Bill to regulate gift vouchers, with Ministers citing coming EU legislation which has primacy over domestic legislation as a reason for not prioritising. In November 2017, I raised the issue of the non-movement on this 2015 Bill. Then Minister of State, Deputy Pat Breen said to me in reply:

I have to consider the advisability of bringing forward a legislative proposal to the Oireachtas when a directly related and fully harmonised legislative proposal may be at an advanced stage of the European Union legislative process.

We learned over the summer that the Minister for Business, Enterprise and Innovation, Deputy Heather Humphreys, intends to bring forward another Bill in the area. I note that the Government is now saying that given the slower than expected progress of EU proposals, it has been converted overnight to the cause of regulating gift vouchers. I hope the Government will consider supporting the passage of my Bill, which is at the most advanced legislative stage of any proposal in the field.

I wish to update the committee of something of which it is probably aware. On 18 September I received correspondence form the Ceann Comhairle indicating that he was satisfied that a money message from the Government is required in respect of incidental expenses arising for the Competition and Consumer Protection Commission as a result of the proposed inclusion of gift vouchers in its enforcement remit under the Consumer Protection Act 2007. The Bills Office has requested a money message from the Department of Public Expenditure and Reform and asked that an initial indication be given within three weeks as to whether it will be provided. I urge the Government to grant a money message so that this Bill can proceed to Committee Stage and enable members to have further input into the legislative process. I look forward to bringing this legislation through the Oireachtas as quickly as possible to ensure that consumer rights are protected.

Members may have discussed the correspondence from the Ceann Comhairle. I was sent a copy and I believe it was sent to the committee Chair. It was dated 18 September. It asked for the Department of Public Expenditure to respond on the issue of the money message due to these incidental expenses. It also noted that there is nothing in the Bill requiring a financial resolution or consultation with the European Central Bank, ECB, and the request was only for a money message.