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UK Gift Card & Voucher Association

71 - 75 Shelton Street - Covent Garden - London WC2H 9JQ

Telephone +44 (0)207 692 0636

Email info@ukgcva.co.uk

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Frequently Asked Questions

Frequently Asked Questions

What is the role of UK Gift Card & Voucher Association?

UK Gift Card & Voucher Association was established to represent voucher suppliers, ensure high standards of practice and promote the use of vouchers. The UK Gift Card & Voucher Association represents 75 per cent of the voucher market, including many of Britain's best known and most respected companies.

UK Gift Card & Voucher Association sets a benchmark and quality standard by which all voucher schemes in the UK are judged, as members discuss and evaluate different ways of handling industry issues in order to establish the highest standards of practice.

Furthermore, UK Gift Card & Voucher Association plays an active role in the development of the industry. Suppliers to the industry regularly update members on future developments in areas such as security printing, research and exhibitions. Also, the UK Gift Card & Voucher Association has a number of established working parties examining and reporting back on issues that affect members. These include exhibitions, tax and financial legislation and supplier partnerships. Members share information on matters of mutual interest.

How do I join the UK Gift Card & Voucher Association?

Joining UK Gift Card & Voucher Association is simple. Once your application form has been submitted, and existing members have voted to accept your application, you will then be eligible for all the benefits associated with membership. Fees are invoiced annually and are payable in advance.

Associate membership is available to ‘preferred’ suppliers to the industry such as printers and designers. The membership fee is negotiable and subject to the approval of members and can take the form of a fee or benefits in kind. Please fill in the enclosed membership form if you are interested in joining.

How is UK Gift Card & Voucher Association managed?

Full membership meetings take place four times a year at a variety of easily reached venues. An agenda is issued in advance and all members are encouraged to provide input. UK Gift Card & Voucher Association also organises social events for networking purposes for members and associate members.

An executive committee of seven, including a Chair and Vice Chair, is elected annually by the members. The executive committee's purpose is to take strategic decisions and direct the operations of UK Gift Card & Voucher Association.

Working parties are also established to address specific issues as and when they arise, manned by three member volunteers.

How does UK Gift Card & Voucher Association promote vouchers?

UK Gift Card & Voucher Association is involved in a number of activities to raise the profile of vouchers to the benefit of all members.

Media

It conducts a vigorous media campaign, driving and commenting on the issues that impact on the industry, as well as forging and maintaining relationships with key journalists.

Exhibitions

UK Gift Card & Voucher Association also participates in key incentives exhibitions each year.
UK Gift Card & Voucher Association also sponsors suitable projects. All members are welcome to partake in UK Gift Card & Voucher Association stand.

Research

Participating members or the organisation are invited to send their quarterly sales data to an independent market research company. This data is collated and analysed, and each member receives a confidential breakdown of corporate and retail sales, indication of market share and details of the total size of the market.

Government Relations

Legislation from both the British Government and the EU has an impact on voucher suppliers.
 UK Gift Card & Voucher Association tracks planned legislation and draws attention to issues that may affect the interests of all members.

Q. I just called you about the Gift Card regulations. I’m the CTO of a startup company that focuses on the B2C market. We are looking into using Gift cards from Merchants across Europe as a cash-out mechanism for our end-users. As far as I could tell from the PSD and e-Money regulations, if we are providing Gift Cards from Limited Network companies, we do not need an e-money license. Did I understand the regulations correctly?

In some cases, we would be accepting the payment from the end-user via Paypal or Credit Card, which will results in points that can be later converted into Gift Cards too. This does not imply that we need an e-money license either, right?

Also, I could not find any limits for the issuing of Gift Cards that fit the Limited Network exclusion. Are there any limits whatsoever in this case, or only in the cases that fall outside the exclusions of PSD/e-Money?

A. Your query has been passed on to me.  I am a lawyer whose firm is a member of the UKGCVA.  I work with businesses who operate regulated and unregulated gift cards.

The key legislation that you need to be aware of when operating a gift card programme is the Electronic Money Regulations 2011 (EMR).  These are the regulations that implement the European Electronic Money Directive (EMD) in to the UK.  Any product that falls within the definition of electronic money which is set out in the EMR must only be issued by those businesses authorised to do so.  Such authorised businesses are classified as electronic money issuers.  This list of e-money issuers is set out in the EMR and includes, amongst others, authorised electronic money institutions and credit institutions. I link to the EMR is attached: http://www.legislation.gov.uk/uksi/2011/99/pdfs/uksi_20110099_en.pdf

EMR (like the PSD) includes an exemption for certain types of products  that fall outside of these regulations and therefore are not required to be issued under these controlled circumstances.  As you noted one of the exemptions relates to products issued within a limited network.  Specifically it applies to  products that are:

"monetary value stored on instruments that can be used to acquire goods or services only

(i) in or on the electronic money issuer’s premises; or

(ii) under a commercial agreement with the electronic money issuer, either within a limited network of service providers or for a limited range of goods or services. "

Neither the PSD , EMD nor the regulations that implement each of them into the UK provide any clear definition, conditions or criteria for determining what is a "limited network of service providers" or "limited range of goods or services".  So in the UK, whether a programme falls under this exemption ultimately a question of judgement and we can only be guided by the brief guidance published by the Financial Conduct Authority (FCA) or knowledge that we have gained as a result of our experience in this sector.   What's more, as there is no definition, the application of the exemption from one country to the next  in the EU is not consistent.  So I recommend you seek legal advice in each of those key countries that you will be focussing your business to understand whether your activities is considered a regulated activity or not.  

For information, the FCA guidance on limited networks is attached:
http://fshandbook.info/FS/html/FCA/PERG/3A/5 and
http://fshandbook.info/FS/html/FCA/PERG/15/5  The guidance is set out in a Question and Answer format. I don’t know the detail of your programme so cannot confirm whether it will fall within this exemption.