Sets New Rebate Law
Assembly Consumer Affairs and Protection Committee Chair Audrey Pheffer has announced that new protections relating to consumer rebates will soon go into effect. As of January 1, 2011, any entity that offers a rebate must conspicuously disclose whether it will be issued in any form other than cash or a check, and whether any additional fees related to the exercise or non-exercise of the rebate apply.
While most rebates are provided in the form of a check, in recent months, some consumers have been surprised to find that certain entities now issue rebate funds on gift cards or prepaid debit cards or as store credit. The new law, which was sponsored by Pheffer, will ensure that consumers are informed of the method of rebate payment prior to purchasing a product subject to a rebate.
“Smart shoppers often base their purchasing decisions on the price of a product after a rebate,” said Pheffer. “Consumers expect to receive their rebate as a cash or check and should not be surprised to find that their rebate funds are issued as store credit or loaded on a prepaid card that may be subject to fees or usage restrictions.”
Pheffer also noted that another measure she sponsored requiring all retailers to prominently display their refund policy in a location that is clearly visible to customers has been in effect for several months. Prior to enactment of Pheffer’s law, retailers that maintained a policy of providing cash refunds or crediting an account within twenty days of the purchase could avoid the refund policy posting requirement.
The law also extends the time period during which a store that violates the refund policy disclosure requirement must provide a customer with a full refund or credit, requires retailers to make a written copy of their refund policy available to consumers, and requires a store’s refund policy posting to include the amount of any fees, including restocking fees.