In reality only a few programs will be affected by the proposal to make points expiry illegal

It has been quite the frenzy over the past 24 hours (we've completed 7 interviews and 1 more to go) in regards to the the proposed bill in Ontario that would make the expiration of points and miles illegal. In our post yesterday we wondered if the bill would cover both Expiry and Inactivity Rules or just Expiry. We hoped for the latter and Aeroplan reached out to us to let us know that:

"as currently drafted, the proposed legislation carves out an allowance for activity policies such as Aeroplan’s.  It will only affect programs with date-stamping policies.  Aeroplan’s activity policy, which requires that members conduct one transaction every 12 months, whether swiping your card at a partner brand or redeeming for a gift card or a flight for example, will remain unchanged from this legislation"

This is good news, if you have heard any of our interviews over the past day or so or later today you'll know that we agree with inactivity rules but not mileage/point expiration. What this means is that if the bill does pass and becomes law in reality it only affects 4 Canadia programs and hitting only 1 hard. Those four programs are AIR MILES, Starbucks Rewards, WestJet Rewards and MyHusky Rewards. Why do we say only one will be hit hard? Well Starbucks Rewards Stars expire after 6 months. That's not a lot of time. But it isn't hard to go to a Starbucks and redeem that Star for that free drink or food. Really easy and there should be no reason to hold onto a Star for 6 months. WestJet Rewards operates like a cash back program. You don't need a lot of WestJet dollars to redeem for a discount on your travel. All you need is 25 WestJet dollars if you don't hold their credit card. As soon as you hit 25 dollars you can redeem for 25 dollars off of a ticket. Again no need to hoard those dollars. There will be some people who maybe join WestJet rewards and have earned 1 dollar here and then three years later earn another that would stand to maybe lose a couple of bucks after 5 years. MyHusky Rewards also works like a cash back program and you only need 130 points ($65 - $130 in spending) to redeem those points for a coffee. So those three programs, you really shouldn't need to worry about expiration.

That leaves AIR MILES. They are the only program that will be seriously impacted by this bill passing. We can only assume there are several millions of AIR MILES Reward Miles set to expire at the end of this month based on the stories we have heard of members who have 5,000 miles to well over 25,000 miles that will be erased from accounts. Is this the fault of the members? No. We've heard countless stories of people planning to use their AIR MILES as a retirement travel fund, one couple that is set to retire in the next 2 or 3 years stand to lose over 25,000 miles that they had banked on using for that retirement. Its not that they have been absentee members, they have been active in the program and really really active to get to 25,000 miles as we all know it is quite hard to earn that many AIR MILES! The fact of the matter is AIR MILES made money on those miles that these members are holding. It isn't like a frequent flyer or frequent guest program that awards points or miles for being loyal (ie WestJet giving you up to 5% on their flights is coming straight out of WestJet's pocket, there is no merchant buying those dollars from them), AIR MILES are sold to merchants for more than the value at which you redeem them at. They have made money on them and are looking at making more money by trying to expire them.

The one question we don't have an answer to yet is for international based programs. Many European and Asian airline programs do have expiry rules, in fact they have had them longer than we have here in Canada. Are you a member of Lufthansa's Miles & More program or Cathay Pacific's Asia Miles? Both programs expire miles 36 months after you have earned them. Numbers wise the membership in these programs in Ontario is probably only in the four or maybe five figures so it won't have as much impact as AIR MILES does. Butwhat jurisdiction do they fall under? Germany, Hong Kong or Ontario?  Typically contracts state they are governed by the laws of the province/state/country that the program resides in. So does that make the Ontario bill not valid for them? We are not legal experts so perhaps one of our readers who is could chime in!

Ultimately this new bill in Ontario only affects AIR MILES. No other program will feel the pain if it passes.