CONSUMER ACT OF

THE PHILIPPINES
(Republic Act 7394)

What is R.A. 7394?

R.A. 7394 is the Consumer Act of the Philippines, which
took effect on 15 July 1992

State briefly the declaration of basic policy.

It is the policy of the state to protect the interest of the
consumer, promote his general welfare and to establish
standards of conduct of business and industry

What are the objectives of the Consumer Act?

- Protection of consumers against hazards to health and

safety;
- Protection of consumers against deceptive, unfair and
unconscionable sales acts and practices;
- Provision of information and education to facilitate sound
choice
and the proper exercise of rights by the consumer;
- Provision of adequate rights and means of redress;
- Involvement of consumer representative in the formulation of
social and economic policies.

Which government agencies implement the

Consumer Act and what are their areas of concern?
DEPARTMENT OF TRADE AND INDUSTRY
- Consumer Product Quality & Safety
- Deceptive, unfair and unconscionable sales acts and
practices
- Weights & measures (metrication)
- Consumer Products and Service Warranties
- Price Tag
- Labeling and Packaging
- Liability for Products and Services
- Service and repair shops
- Advertising and sales promotion

DEPARTMENT OF AGRICULTURE
-

Agricultural Products
-- Quality and safety
-- Labeling and packaging

DEPARTMENT OF HEALTH
- Food, drugs, cosmetics and devices and hazardous
substances
-- Quality and safety
-- Labeling and packaging
-- Advertising and sales promotion
-- Price tag

DEPARTMENT OF EDUCATION
-

Consumer education and information

BANGKO SENTRAL NG PILIPINAS (BSP)

- Consumer credit transactions extended by banks and
other
financial intermediaries

SECURITIES AND EXCHANGE COMMISSION (SEC)

- Credit facilities extended to consumers by financial
companies

LOCAL GOVERNMENT (PROVINCIAL, CITY OR MUNICIPAL

TREASURER)
- weighing scales

DTIS AREAS OF CONCERN:

CONSUMER PRODUCT QUALITY AND SAFETY

Product Certification is a process that determines
whether a product is manufactured according to
requirements of a standard (Philippine National Standards
or foreign standards recognized by the Philippines.).

Quality The PS Marks

PS Quality and safety, and ICC marks assure consumers that

the
products have been tested and have proven to have met
the
necessary performance and safety requirements, therefore,
reliable and safe when properly used.

DECEPTIVE, UNFAIR AND UNCONSIONABLE SALES ACT AND

PRACTICES

A sales act or practice is considered deceptive

whenever the producer, manufacturer, supplier or seller, or
owner or operator of a consumer service or repair firm
through concealment, false representation or fraudulent
manipulation, induces a consumer to enter into a sales or
lease transaction of any consumer product or service.

WEIGHTS AND MEASURES

DTIs concern on this area is focused only in the use of
the metric system.
R.A. 7394, Ch. II, Art. 63 states that the system of
weights and measures to be used for all products,
commodities, materials, utilities, services and commercial
transactions, in all contracts, deeds and other official and
legal instruments and documents shall be the metric system.

CONSUMER PRODUCTS AND SERVICE WARRANTIES

Express Warranty all written warranties or guaranties
issued by a manufacturer, producer, or importer (terms,
parties involved, products or parts covered, information on
how to avail of the rights, period of obligations under
warranty)
Implied warranty legal warranty which provides
protection against hidden defects and eviction.
Guaranty of Service Firms service firms shall guarantee
work-manship for a period not less than ninety (90) days.

PRICE TAG
The Price Tag Law, as embodied in Republic Act No. 71 as
amended, requires price tags or labels to be affixed on all
articles or commerce for sale on retail.
A Price Tag should:
- be clearly written
- be visible upon examination
- state the price of the commodity per unit (i.e. piece,
package,
kilo, meter, dozen, etc.) in pesos and centavos
- bear no erasures or alterations
Note: A price list may be used for minute or tiny articles and
perishable products.

Guidelines on Shelf Pricing

DAO 9 S. OF 2002 authorizes the use of shelf pricing in combination
with modern technology for automatic product
identification.
Pre-requisites:
1. Use of itemized receipt or cash register tape which states the
description, size, quantity and individual price of the consumer
goods purchased: and,
2. At lease one (1) Price Verification Counter or similar electronic
system for multi-storey establishment at least one per storey.
Note: In case of inconsistencies in the price shown on the shelf, on
the product itself or in the database price when the item is
scanned, the lowest price shall prevail.

Additional Requirements on Price Tagging

DAO 10 s. of 2006 - reiterating the rules on price tags/labels and

providing prohibition against the imposition of a
surcharge, extra change in the use of credit/
automated teller machine (ATM)/debit cards for
payment of purchases of consumer products or
services.

Price tags must be inclusive of VAT whenever the product is

VATABLE. Service charge, if any, shall not be included in the price
tag

When consumer pays through a credit/ATM/debit card, he

shall pay only the price indicated in the price tag.

Price tag indicating a separate CASH PRICE TAG and

REGULAR PRICE TAG on each product or service is not
allowed.

Price tag indicating a separate CASH PRICE TAG and CARD

PRICE TAG on each product or service is not allowed.

LABELING AND PACKAGING

The State requires labeling and fair packaging for all
consumer products domestically sold whether manufactured
locally or imported indicating the following in their respective
labels of packaging:
a. its correct and registered trade name or brand name;
b. its duly registered trademark;
c. its duly registered business name;
d. address of the manufacturer, importer, repacker of the
consumer
product in the Philippines;
e. its general make or active ingredients;
f. Net quantity of contents in metric system;
g. country of manufacture, if imported; and,
h. Info if the consumer product is manufactured, refilled or
repacked
under license from a principal.

LIABILITY FOR PRODUCTS AND SERVICES

The Philippine Government holds any Filipino or foreign

manufacturer, producer, and any importer liable for redress
for product or service imperfections.

Remedies Available to Consumers:

a.) For quality imperfection, the customer has the right to choose:
- replacement of the product by another of the same kind in
perfect state of use;
- immediate reimbursement of the amount paid; and,
- proportionate price reduction.
b.) For product quantity imperfection, the customer may demand
alternatively at his option:
- the proportionate prices;
- the supplementing of weight or measure differential;
- the replacement of the product by another of the same kind,
mark or model, without said imperfections; and,
- immediate reimbursement of the amount paid with monetary
updating without prejudice to losses and damages, if any.

c.) For service quality imperfection , the customer is entitled to

demand alternatively at his option:
- the performance of the service, without any additional cost
and
when applicable;
- the immediate reimbursement of the amount paid, with
monetary
updating without prejudice to losses and damages, if any;
and,
- a proportionate price reduction
Notes:
1. No Exchange, No Return Prohibition consumers are
entitled to either a replacement or refund, as long as there is
a defect or imperfection in the product or service.
2. Re-performance of service may be entrusted to duly
qualified third parties, at the suppliers risk and cost.

SERVICE AND REPAIR SHOPS

R.A. 7394, Chapter VII, Art. 125 outlines the requirement
of the State for the accreditation of repair and service firms
or establishments and their technical personnel in order to
protect the interest of the consumers availing of their
services.
Accreditation is the legal recognition that a service or repair
enterprise has complied with the requirements of the law
and fulfilled the basic requirements of the industry for their
operation.

ADVERTISING AND SALES PROMOTION

The Department of Trade and Industry has been tasked

to enforce provisions of the Advertising and Sales
Promotion Law and supervise implementation or conduct of
promotion of sales of consumer products and services
(excluding promotion activities involving food, drugs,
cosmetics, devices and hazardous substance.)

When is the Consumer Act applicable?

- If the complainant is a natural person;
- If the subject of the violation is a consumer product or
service;
and,
- If the nature of the complaint is regarding any of the
aforementioned concerns.

What is Consumer Product or Service?

Consumer product or service means goods, service and
credit, debts or obligation which are primarily for
personal, family, household or agricultural purposes, which
shall include, but not limited to food, drugs, cosmetics and
devices.

What is the period for filing consumer complaints?

Within 2 years from the time the consumer transaction was
consummated or the deceptive or unfair and unconscionable act
and practice was committed, and in case of hidden defects,
from discovery thereof.

SCHEDULE OF FINES FOR R.A. 7394

a.

Price Tag and Metrication

b.

Violation of the Consumer Act P500 to P300,000

aside from Price Tag & Metrication

P500 to P150,000

Note: 1. In the event the offender is engaged in two or more

activities, the activity to which a higher penalty
corresponds shall be made the basis in imposing the
appropriate fine.
2. For every day of continuing violation, the amount of
P1,000 shall be paid over and above the
administrative
fine imposed.

Thank you
&
God bless!!!