iTunes credit in Canada

Wednesday, September 30, 2009 at 13:56
The short version for impatient people:

Apple will not allow Canadians to use their iTunes credit or iTunes gift cards to purchase software ("apps") in the iTunes store. It can only be used to purchase music, movies or TV shows. Apple claims that "this is due to Canadian Commerce Laws that the iTunes Store must strictly enforce". The Canadian Minister of Industry, Hon. Tony Clement, believes that there are no laws which prevent this. So, where did Apple get this idea that software, games and applications may only be purchased with a credit card?

The long version for curious people:

In June of 2009, my daughter bought an iPod Touch, mostly to use for playing games. To do this, I set her up with a new iTunes account and funded it with $10 via iTunes allowance. However, she was not able to use her allowance to pay for any games and iTunes kept asking her to set up a credit card for her account. My daugher is 10 years old and does not have a credit card and I don't want to attach my credit card to her account. I want her to be able to use the allowance I've provided for her.

On July 2, 2009, I wrote this email to Apple iTunes support:

I have set up an allowance for my child's account *****@********.***. She has $20.00 in her iTunes account, but is unable to make an app store purchase - receives error msg that she must select a payment method in her account. I do not want that account to have a credit card associated with it, only the allowance amount. How can she get the app store to allow this?


And the next day, I received the following response:

Dear Jim,

Hello! How are you? Thanks for contacting iTunes Store Customer Support. My name is Corvacia. I have received your email and will be assisting you with your request. I will try everything within my scope of support to help you to resolve this issue.

I understand that your daughter is not able to purchase Apps with her allowance. I have reviewed her account and noticed that she reside in Canada. I'm sorry, but you will not be able to purchase software, games, or applications with store credit or an iTunes Gift Card in Canada. Customers residing in Canada may only purchase software, games and applications using a credit card. This is due to Canadian Commerce Laws that the iTunes Store must strictly enforce. In addition, this is why you have been asked to enter billing information even though you have store credit remaining.

Your iTunes Gift Card balance can be applied towards purchases of all other types of content on the iTunes Store.


Sincerely,

Corvacia

iTunes Store Customer Support


That prompted me to do some googling around and sure enough this has been an issue for quite a while. But all I could find online was people complaining about the issue - no references to exactly what laws are being used to inconvenience Canadian consumers. So I tried to find out.

On July 5, 2009 I replied back to Apple support with the following:

Thank you for the explanation. I understand the position Apple is in. However, I relied upon this text in the iTunes help file when purchasing the allowance for my daughter's account:

"Recipients can use gift certificates and allowances toward the purchase of anything in the iTunes Store (unless you have restricted access to items with a Parental Advisory Label)."

Since it is not possible for her to purchase games with her allowance and she has no interest in purchasing music or videos, I would like to have the allowance credited back to my account or credit card. I also recommend that the text above be changed so as not to mislead other consumers about the use of iTunes allowance and store credit.

In addition, I would appreciate it if you could name the specific Canadian commerce law that Apple must enforce as I intend to pursue the issue with my government representative.

Thank you.


I contacted my Member of Parliament, Hon. James Rajotte and asked for his assistance to identify the Canadian commerce law that Apple is referring to. His office was unable to do so and Mr. Rajotte then contacted the Canadian Minister of Industry, Hon. Tony Clement on my behalf. Here is a copy of his letter:



In the meantime I received this helpful (sic) reply from Apple:


Dear Jim,

My name is Rashida and your issue has been escalated to me and I would be assisting you from now on.I understand that you contacted your Member of Parliament regarding the commerce law and they were unable to identify this law, that's affecting the use of iTunes Gift Card to purchase games and applications in Canada. You would like us to provide any help we can regarding this issue. Hopefully I can shed some light on this matter.

Please know that our ability to address these particular issues is limited as iTunes Store agents. Fortunately, Apple provides a page specifically for customers to submit feedback. On more than one occasion I have seen changes made within Apple solely based on customer comments. As a matter of fact, customer feedback is the driving force behind many of Apple's policies and products.

Here's a link to submit your feedback if you wish to:

http://www.apple.com/feedback/itunesapp.html"

I want to do everything I can to help you out. So, for your time and inconvenience this issue has caused, I have issued "2" song credits to your "*****@********.***" iTunes Store account. You can use these to buy the individual songs of your choice from the iTunes Store.

When you next sign in with this account, the song credits will appear by your account name (in the upper-right section of the iTunes Store). The next individual song you buy from the iTunes Store will use one of your song credits instead of your primary form of payment (until all credits have been used or have expired). Please note that song credits cannot be used for purchasing songs that are listed as "Album Only."

If you don't see your credits, refresh your account information by signing out and back in to the iTunes Store. You can find both "Sign Out" and "Sign In" within the pull-down "Store" menu. If you don't see this menu, you should need only download the latest version of iTunes from our website for free:

http://www.apple.com/itunes/download/

Again, I apologize for the inconvenience this issue has caused you. I hope you continue to enjoy the iTunes Store. Please let me know should you have further questions or concerns regarding iTunes Store and I'll be more than happy to help. Have a great day, Jim!

Sincerely,

Rashida
iTunes Store Customer Support


So... After I explained to Apple that my daughter didn't want to purchase music with her iTunes store credit and asking for a refund they responded by giving her more credits for music. Hmmm. OK whatever, my real concern is to figure out why Apple thinks the Government of Canada is telling them they can't sell apps to Canadians who pay with store credit instead of credit cards.

Today, September 30 2009 I received a cc of the reply from Hon. Tony Clement to my MP, and the Minister doesn't know of any law preventing Canadians from using an iTunes allowance or gift card for purchases in the app store. Copy of his letter:



So where does that leave me (and other Canadian Apple customers)? Stuck, apparently. Still, I'm not giving up yet. I've sent a brief email to Steve Jobs and I'll post an update if I receive any response.

42 comments

  1. I am dealing with the same issue, i have no need for the videos, music, etc. I was about to the do the same "chase" if you will, that you are on. I appreciate seeing someone has done this and will check often to see progress.

    In the mean time, I have NOT tried this yet as i can not afford to, but I was told by apple to use a pre-paid credit card from Walmart, whereever you may find them.

    Best of luck and i will keep checking here.

  2. jimmycanuck Says:

    Hi Jim,

    Thanks for taking up the cause of millions of Canadian consumers! I just wanted to let you know that we've covered you story on MacApper.com.

    http://macapper.com/2009/10/05/jim-whitelaw-vs-apple-canada/

    We look forward to following any progress you might make!

  3. Brian Says:

    I just read about your battle with Apple in MacApper. http://macapper.com/2009/10/05/jim-whitelaw-vs-apple-canada/

    Please keep folks updated with your progress. Apple's refusal to cite the law they are supposedly following is inexcusable. They are counting on the little guy not to fight back.

    - Brian, USA

  4. Todd Says:

    Hey Jim,

    Sorry to hear about your situation. I have another beef with Apple's "Itunes App Store Canada" its a canadian store yet none of the prices are in american dollars but no where does it state that. I buy a $0.99 app and my credit card gets charged $1.19. Its a total cash grab from us canadians, if you want to charge american dollars I am pretty sure you have to let us know.

    Apple has a few things to work out legally in Canada.

  5. josh Says:

    I'm in the same boat - have a $50 Canadian iTunes gift card burning a hole in my pocket. Apple! I want to spent this on apps!

    Thanks for fighting the good fight.

  6. Thank you for pursuing this issue - we too, and I'm sure many others who have not responded in the same way, have found ourselves in the position of having bought an iTunes card to buy apps, only to find out that we could not do so. Nor do we wish to take on the costs of any kind of credit card. We'll follow your progress with interest and hope that Apple finds a way to help its customers instead of excusing itself.

  7. DaveP Says:

    Another here. Had a $25 gift card that was pretty much useless to me. Traded it to a colleague for cash. I gave up after talking with an in-store apple rep who said there was nothing she could do.

  8. ™ © Says:

    WOW Jim ... it looks like you actually did a lot of research about this. Tell me one thing.... did you read the terms of sale like you said you did when you clicked the button agreeing to the terms stated when you created yours and your daughters account?

    here … ill make it easy for you and past it here

    NOW KEEP IN MIND THAT YOU AGREED TO THESE TERMS BEFORE YOU CREATED AN ITUNES ACCOUNT AND BEFORE YOU PURCHASED A CERTIFICATE OR AN ALLOWANCE OR REDEEMED A GIFT CARD

    Gift Certificates may be redeemed for iTunes Store transactions only and are non-refundable for cash. They cannot be used for purchases on the Apple Online Store or used in Apple Retail Stores. Purchases for Gift Certificates may be purchased only in whole Canadian dollar increments or designated amounts. Gift Certificates may not be used to purchase other Gift Certificates, iTunes Cards or Monthly Allowances. Gift Certificates cannot be used to purchase software, games, or apps.

    Monthly Allowances are for transactions on the iTunes Store only. The Allowance Account may not be used for gifts, or purchases on the Apple Online Store or in Apple Retail Stores. Monthly Allowances may not be used for purchases on the Apple Online Store or in Apple Retail Stores. Monthly Allowances are non-refundable. Monthly Allowances may not be used to purchase Gift Certificates, iTunes Cards, Apps, or other Monthly Allowances. Monthly allowances may not be used to purchase software, games, or apps.

    iTunes Cards are for transactions on the iTunes Store only. iTunes Cards may not be used for gifts, or purchases on the Apple Online Store or in Apple Retail Stores. iTunes Cards are non-refundable. iTunes Cards may not be used to purchase Gift Certificates, Monthly Allowances, Apps, or other iTunes Cards. iTunes Cards may not be used to purchase software, games, or apps.

    So i guess your right, the support agent provided incorrect information(as if that never happens!), but this entire situation could have been avoided if you had done what you said you had done when you clicked the button "i have read and agree to these terms of sale" Blaming apple after the fact hardly seems appropriate. Like suing McDonalds for the burns you got when you spilled your coffee in your lap .. but its not your fault the hot liquid warning was not big enough .. and its not your fault you did not read the terms of sale right? Do what you say you do and you will be a well informed consumer.

  9. frieken Says:

    Thanks for your insight of this issue. I am one of many in the same situation. Here is what support sent to me.


    Here is the iTunes Gift Cards Terms and Conditions:

    iTunes Gift Cards Terms and Conditions
    This card is redeemable only on the iTunes Store for the Canada. To redeem this card you must have an iTunes Store account, subject to prior acceptance of license and usage terms. To open an account you must be above the age of 13 and in Canada. The iTunes Store requires iTunes 6.0 or later (7.0 or later for video), compatible software and hardware, and Internet access (fees may apply). Not redeemable for cash (except if required by law). iTunes Gift Cards may not be used on the Canadian store to purchase applications and games. No refunds or exchanges allowed and this card may not be used to purchase any other merchandise, allowances or iTunes gifting. Data collection and use subject to Apple Customer Privacy Policy, see www.apple.com/legal/privacy, unless stated otherwise. Risk of loss and title for card passes to purchaser on transfer. Apple is not responsible for any loss or damage resulting from lost or stolen cards or use without your permission. Apple and its licensees , affiliates, and licensors make no warranties, express or implied, with respect to prepaid cards or the iTunes Store and disclaim any warranty to the fullest extent available. These limitations may not apply to you. Void where prohibited. Not for resale. Subject to full terms and conditions, available at www.apple.com/support/itunes/legal/giftallowances.html. Content purchased from the iTunes Store is for personal lawful use only. Don’t steal music.

    Once again, I do apologize for the lack of information regarding this issue and not being able to use another method of payment besides credit cards for purchasing applications and game content within the Canadian store.

    Interesting enough though, I went to a store and read through the packaging the cards are on and the cards themselves. The packaging says you can purchase songs and more, the cards only say that the card is redeemable only on iTunes stores for Canada. Nowhere does it say that they may be limited to what you can buy. So you buy the card with good intent only to find out it is useless for the intended purpose, buying games and apps.

    To me, this is deceiptful labeling which is illegal in Canada.

    For me, they gave me 5 free songs. Whoop de doo.

  10. Good luck with this. I just got bit too.

  11. THE BELL Says:

    You can purchase Microsoft XBOX points at your local electronic store to buy games via XBOX live. No problems there so why is it that we have trouble with apple?

    bought my gift card today only to find out i can't purchase and app.

    frustrating.

  12. MarsInMary Says:

    And it seems that there's not much you can do to pass on the account credit to somebody who wants songs either. We tried gifting music from the gift card credit and it wanted to charge the credit card again. The agreement, turns out says, you can't buy a gift card with a gift card, and you can't gift anything with a gift card. Shouldn't this be listed in information more people are likely to read besides in a pop-up list of agreement technicalities?

  13. Tony Says:

    Many thanks for taking this on Jim. I've wondered the same thing myself, but didn't have the tenacity to dig this deep. Keep us informed! :)

  14. f-wallet Says:

    Great follow through. I've been dealing with this as well. What I would like to know is why does this apply to Apple's iTunes cards but I cam buy a PSN card and buy games on the PS3?

  15. Dallas Says:

    Makes me wonder if it's not an explicit problem with law but some nonsense in how Apple has done cross-border contracts and sales tax and who knows what else. I'm thinking Apple has done something weird and are hiding behind a generality in here rather than stating they took a big shortcut in tax laws or legal distribution agreements with the RIAA or MPAA or some other pinheads and now it gets buggered up in Canada for applications as a result?

  16. laura Says:

    After reading many of the comments and realizing that i too fell into the same trap, I get the feeling that apple is just doing this so that they can get our money and not provide a service for us...

    Sure there's a few posts there with the terms of service, but it just seems absurd for a company to continue to hide behind something so vague that the Cabinet Minister responsible for that sector doesn't even know about it!

  17. Russ Says:

    Heh, I'm guessing Jobs didn't reply?

  18. Laserheart Says:

    Any updates on this? I think it's ridiculous when corporations use some arcane laws in Canada to prevent commerce in our own country.

    It could be simply that Alberta has instituted a law banning the "expiry" of gift cards. This may have prevented Apple from allowing gift card use, because they may expire at some time in the future, or some of them do expire (like time limited codes)??

  19. bob1645 Says:

    Hey I am just a kid at 14 and I (like many others) do not have access to a credit card to buy the apps for my brand new Ipod Touch.

    I did, however, receive 80$ worth of gift cards this christmas in the hopes to purchase some apps.

    Of course, when I found out I needed a credit card I figured it was for a good reason that was clearly identified meaning I had simply missed the explanation. Anyways I did some googling and was happy to find someone who actually "had the answer" (or at least was taking action to find it).

    Of course, the answer is a smack in the face to us... There are no laws, Apple are either mistaken or full of it.

    That sounds good to me - better chances Apple will remove the policy!!


    I thank you, Jim, for going through this battle because you are doing what almost everyone who bought a itune card is thinking. I'm very pleased to here Apple has screwed up here but that being said it is no suprise they aren't returning your mail in a hurry!

    Great work so far.

  20. Tom Says:

    Hi everyone,

    I can't believe how this issue isn't resolved. I got caught with it as I got two gift cards for Chritmas. I have created a facebook group called itunes Canada - Stand up for your gift card rights"

    Hopefully we can get a lot of members and really start pushing with Apple. The bottom line is:

    1) When you buy a gift card, you expect to buy items from the store you got it from. The exclusions for apps don't make sense
    2) The wording on the front of the card are misleading at best.
    3) In itunes when browing for apps if you have redeemed a gift card, it shows you a credit!!

    I have some ideas once we get a large enough number of people to take this further. I am impressed that you went all the way to Tony Clement. We can build on what you started!

    Tom GIlmor

  21. Tom Says:

    Hello,

    I can't believe all the work you have done on this and I know a lot of people who are hoping you have found a solution.

    I have created a group on facebook called itunes Canada - Stand up for your gift card rights" You have done a lot of work already and I hope we can build on it. I encourage people to join the group. I have ideas on how we can bring light of day to this issue once we get enough people.

    I invite all of you to join!

  22. Tom Says:

    Sorry for the duplicate post, didn't think the first one went through

  23. cg Says:

    Well I just got burned by this too. I've escalated and will be pushing the issue with them for a refund. What I don't understand is how they could circumvent provincial law. I'm pretty sure in Ontario it is law that you can return any purchase for a full refund if you do so within 48-72 hours. They can print whatever they like on the card, but it doesn't circumvent the laws.

    Jim, have you explored the angle that they may be breaking the law by not refunding the money if a refund is requested within provincial guidelines?sy

  24. henrylow Says:
    This comment has been removed by a blog administrator.
  25. ryan Says:

    Yes prepaid giftcards do work but you are charged a $4.50 activation fee.You can get them at shoppers, sobeys ect.)

    Apple and itunes have caused me nothing but trouble.

    I htink we should make a petition or something

  26. ryan Says:

    Yes prepaid giftcards do work but you are charged a $4.50 activation fee.You can get them at shoppers, sobeys ect.)

    Apple and itunes have caused me nothing but trouble.

    I htink we should make a petition or something

  27. maxina Says:

    Hey, I am going to write a letter to my mp, mike lake, telling him about this, he is probably going to be peeved off because his son is getting to that age of having an ipod!!!!

  28. Dave Says:

    I just bought a $15 dollar card at needs and have no use for videos or music myself, is there anything we can do about this?

  29. Linnell Says:

    Response from Apple about my card purchase!

    I'm sorry that you will not be able to purchase software, games, or applications with store credit or an iTunes Gift Card in Canada. Customers residing in Canada may only purchase software, games and applications using a credit card.

    I didn't think to check online before I bought a card!
    With 4 carriers now in Canada the may need to rethink this policy.

  30. blog Says:

    Hi Jim,

    Thought you'd like to know, I just glanced at the referral logs on my site and noticed traffic from this post to my site, through the trackback, and the IP address was the House of Commons. mailin.parl.gc.ca Hoping that means someone is listening!

    Cheers,
    Dani
    Postcards from the Mothership

  31. Nick Says:

    I ran into the same problem. My card was only for $15, so not a big deal, but annoying none the less.

    I hope your efforts can make whoever is responsible for this weird rule change their policy!

  32. Shannon Says:

    Thank you Jim. My daughter wanted to update her itouch using her gift card, it's under $5 and they want a credit card. I don't want to use my card, especially for security reasons. Kids should have more options - all of us should. If there is no law then what do they gain by forcing us to do this? Keep tabs on our contact info? I wrote to itunes feedback and my daughter joined the Facebook page "itunes Canada - Stand up for your gift card rights" and invited her friends to join as well. Shanna

  33. Linnell Says:

    Please count on my support. I have a credit from an ITunes card. I did try to give to the Hope for Haiti and they would only again accept Credit cards so I cannot give it away. I did download the music to contribute.

    Facebook Group please join if your on facebook!

    http://www.facebook.com/group.php?gid=274832851022

  34. Rhyan Says:

    I have an American bank account with a MC debit card. But apple will not let me use this card either as I live in Canada. No other company has a problem with this and I have bought a lot of software from the states with this card. As long as I pay duty for physical items like CD's and DVD's digital content does not require any fees.

  35. Rhyan Says:

    I am looking around to see if anyone is filing a class action suit against apple on this issue. I will let you know if I find one.

  36. brian Says:

    I am an American living in Mexico and its just as bad here. I travel frequently between the US and Mexico and Apple just does not want to cooperate with me. One time I bought a Macbook in Mexico and while I was traveling in the US I bought applecare for my Macbook. Well guess what happened when I tried to register it? It wouldn't let me because if you buy a computer in one country you have to buy the Applecare there too, even though the Applecare warranty is valid (supposedly) all over the world. That is just one small example of the issues I have with Apple policies. I have been prevented more times than I can count from purchasing Apple products because of their stupid policies.

    People bitch about Microsoft but in my experience Apple is waaaaaaaaaaay worse as far as customer relations and customer service. Apple can suck it!

  37. RTMS Says:

    It actually is a tax issue, but not a law that Apple is referring to. It is that Apple does not want to pay the taxes on Apps so they throw up this made up law. It's a loophole that allows them to say tax laws are at fault when in fact it is their own greed.

  38. Laserheart Says:

    That doesn't make a lot of sense.

    They charge taxes to the consumer, and it is passed on to the end user no matter what form of payment the consumer uses.

    Actually, Apple might save money to allow gift card purchases, because if a person bought the gift card at a 3rd party (ie. retail mall) Apple doesn't have to pay a "processing fee" to the credit card company.

    If they allow gift cards to be used to buy or rent movies and music, there is no difference to buying an app.

    Something's wrong at Apple, and they don't want to admit it.

    My personal opinion is that there is a piracy issue with gift cards, and Apple doesn't want to be responsible to pay some of these companies for the "$1000 apps" with a fraudulent card.

    If someone buys a 99c song, it's no big deal if the card is pirated, but if they start buying $1000 apps with their cards, Apple has a much harder time pursuing and prosecuting them if they do not reside in the U.S.

    That's just a theory, though.

    I just think Apple should be honest with the consumer and with our government as to what's up.

    I can't believe they are blaming the Canadian government for this, and the government just shrugs their shoulders or are oblivious to what is going on.

    There should be some sort of law that protects a consumer's money when they buy gift cards.

    Even Alberta had to enact their own laws to protect consumer gift cards because there wasn't a federal law to do that.

    At least in the U.S., they recently enacted some new gift card laws that go further in protecting consumers... maybe (as usual) the Canadian government will copy them and we will be afforded some protections too.

  39. rmdewar Says:

    I was caught too. I bought a $25 gift card to purchase some apps. Once I had discovered that they would not accept it, I contacted them and asked for a refund. I got my money back. I am absolutely no longer a fan of apple and I will be sure to pass along my dissatisfaction with this company to anyone and every one I meet.

  40. Simon Wei Says:

    Thanks for the information. Good thing I read this before I go and buy the itune gift card.

  41. Joe Says:

    The gift cards now work in Canada for Apps. I just noticed it started to work a few weeks ago.

  42. Flora jems Says:

    You can use your iTunes Gift Card to buy the songs, how to buy itunes gift card movies and other apps that you want to buy.

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