OLR Research Report

January 20, 2009




By: Meghan Reilly, Legislative Analyst

You asked about prepaid phone cards and whether their treatment is affected by our gift card law.

As defined by CGS 42-370, a “prepaid calling card company” uses its own network or resold services to provide to the public a prepaid telecommunications service allowing an end user to originate a call using an authorization code. Companies selling prepaid calling cards must, at the time of sale, disclose clearly and conspicuously:

1. surcharges or fees, including monthly fees, per call access fees and surcharges for units of use applicable;

2. any rounding of time used and the formula of computation of such rounding;

3. any application or other fees charged to the consumer;

4. any restrictions on use of the prepaid calling card; and

5. a toll-free consumer assistance telephone number.

Violations are unfair or deceptive practice under CGS 42-110b.

Connecticut's gift card law (CGS 3-65b, 3-65c, 3-73a, and 42-460) prohibits issuers of gift cards from imposing expiration dates on the cards or charging dormancy or similar fees for periods when there is not activity on a card. Prepaid calling cards are specifically excluded from the CGS 3-56a(5) definition of “gift certificate.” As a result, the laws governing gift cards or certificates do not affect the regulation of prepaid phone cards.