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MEP Kelly calls for temporary COVID-19 flexibility for online gift card restrictions

Published: Wed, 15 April 2020

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MEP for Ireland South and Leader of Fine Gael in the European Parliament, Sean Kelly, has called on the European Commission to consider allowing temporary flexibility on rules governing the use of pre-paid gift cards for online transactions to increase options for consumers while many retail outlets remain closed.

Gift cards are often given by employers to their employees as a bonus under the Government’s Small Benefits tax exemption policy. In 2018, the EU money laundering Directive placed a limit of EUR 50 on online transactions on the basis that such anonymous pre-paid cards could be used to finance terrorist activities.

Speaking from Killarney today, Mr. Kelly made the following comments:

“While nobody would question with the importance and effectiveness of the EU’s Directive on money-laundering and terrorist financing, the current measures in place across the EU to tackle COVID-19 have made the EUR 50 limit on online payments more restrictive than was originally intended.

“When we passed this legislation a couple of years ago, EUR 50 was considered to be the appropriate limit, having worked to strike the right balance between preventing the financing of illegal activities, while catering to the needs of consumers, and allowing the use of such cards for the promotion of social and financial inclusion.

“Today, we find ourselves in a situation in which physical retail outlets are closed, and many holders of gift cards are only able to use them online. Workers that have earned their bonuses are now in a position where they are finding it difficult to spend them.

“I am therefore asking the Commission to consider the possibility of a temporary relaxation of the restrictions, or a temporary slight increase on the limit for online transactions.

“The conditions under which this limit was introduced have changed greatly following the outbreak of COVID-19, and consumer needs have changed substantially, albeit temporarily”, concluded Mr. Kelly.

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