Republic Act No.

7394 April 13, 1992 establish consumer product quality and safety standards
THE CONSUMER ACT OF THE PHILIPPINES which shall consist of one or more of the following:
TITLE I. – GENERAL PROVISIONS a) requirements to performance, composition, contents,
design, construction, finish, packaging of a consumer
Article 1. Short Title. – This Act shall be known as the product;
"Consumer Act of the Philippines." b) requirements as to kind, class, grade, dimensions,
weights, material;
Article 2. Declaration of Basic Policy. – It is the policy c) requirements as to the methods of sampling, tests and
of the State to protect the interests of the consumer, codes used to check the quality of the products;
promote his general welfare and to establish standards d) requirements as to precautions in storage,
of conduct for business and industry. Towards this end, transporting and packaging;
the State shall implement measures to achieve the e) requirements that a consumer product be marked with
following objectives: or accompanied by clear and adequate safety warnings
a) protection against hazards to health and safety; or instructions, or requirements respecting the form of
b) protection against deceptive, unfair and warnings or instructions.
unconscionable sales acts and practices;
c) provision of information and education to facilitate For this purpose, the concerned department shall adopt
sound choice and the proper exercise of rights by the existing government domestic product quality and safety
consumer; standards: Provided, That in the absence of such
d) provision of adequate rights and means of redress; standards, the concerned department shall form
and specialized technical committees composed of equal
e) involvement of consumer representatives in the number of representatives from each of the Government,
formulation of social and economic policies. business and consumer sectors to formulate, develop
and purpose consumer product quality and safety
Article 3. Construction. – The best interest of the standards. The said technical committees shall consult
consumer shall be considered in the interpretation and with the private sector, which may, motu proprio, develop
implementation of the provisions of this Act, including its its own quality and safety standards that shall be subject
implementing rules and regulations. or agencies after public hearings have been conducted
for that purpose; and shall likewise consider existing
Article 4. Definition of Terms. – For purposes of this international standards recognized by the Philippine
Act, the term: Government.

CHAPTER I Article 8. Publication of Consumer Product

CONSUMER PRODUCT QUALITY AND SAFETY Standards. – The concerned departments shall, upon
promulgation of the above standards, publish or cause
Article 5. Declaration of Policy. – It shall be the duty of the publication of the same in two (2) newspapers of
the State: general circulation at least once a week for a period of
a) to develop and provide safety and quality standards not less than one (1) month. It may likewise conduct an
for consumer products, including performance or use- information campaign through other means deemed
oriented effective to ensure the proper guidance of consumers,
standards, codes of practice and methods of tests; businesses, industries and other sectors concerned.
b) to assist the consumer in evaluating the quality,
including safety, performance and comparative utility of Article 9. Effectivity of Rules. – a) Each consumer
consumer products; product standard or safety rule shall specify the date
c) to protect the public against unreasonable risks of such rule is to take effect, which shall not exceed ninety
injury associated with consumer products; (90) days from the date promulgated unless the
d) to undertake research on quality improvement of concerned department funds, for good cause shown,
products and investigation into causes and prevention of that a later effective date is in the public interest and
product related deaths, illness and injuries; publishes its reasons for such finding. After which, it
e) to assure the public of the consistency of shall no longer be legal to, or cause to, sell or distribute
standardized products. the consumer product not complying with the standards
or rules.
Article 6. Implementing Agencies. – The provisions of b) The department may, by regulation, prohibit
this Article and its implementing rules and regulations a manufacturer from stockpiling consumer products so
shall be enforced by: as to prevent such manufacturer from circumventing the
a) the Department of Health with respect to food, drugs, purposes of this paragraph. The term "stockpiling"
cosmetics, devices and substances; means manufacturing or importing a product between
b) the Department of Agriculture with respect to products the date of promulgation of its consumer product safety
related to agriculture, and; rule and its effective date, at a rate which is significantly
c) the Department of Trade and Industry with respect to greater than the rate at which such product was
other consumer products not specified above. produced or imported during a base period as prescribed
in the regulation under this paragraph, ending before the
Article 7. Promulgation and Adoption of Consumer date of promulgation of consumer product safety rule.
Product Standards. – The concerned department shall
Article 10. Injurious, Dangerous and Unsafe ninety days from the date of amendment or revocation is
Products. – Whenever the departments find, by their published unless the concerned department finds, for a
own initiative or by petition of a consumer, that a good cause shown, that a later effective date is in the
consumer product is found to be injurious, unsafe or public interest and publishes its reasons for such finding.
dangerous, it shall, after due notice and hearing, make The department shall promulgate the necessary rules for
the appropriate order for its recall, prohibition or seizure the issuance, amendment or revocation of any consumer
from public sale or distribution: Provided, That, in the product safety rule.
sound discretion of the department it may declare a
consumer product to be imminently injurious, unsafe or Article 13. New Products. – The concerned department
dangerous, and order is immediate recall, ban or seizure shall take measures to make a list of new consumer
from public sale or distribution, in which case, the seller, products and to cause the publication by the respective
distributor, manufacturer or producer thereof shall be manufacturers or importers of such products a list
afforded a hearing within forty-eight (48) hours from such thereof together with the descriptions in a newspaper of
order. general circulation.
The ban on the sale and distribution of a
consumer product adjudged injurious, unsafe or Article 14. Certification of Conformity to Consumer
dangerous, or imminently injurious, unsafe or dangerous Product Standards. – The concerned department shall
under the preceding paragraph shall stay in force until aim at having consumer product standards established
such time that its safety can be assured or measures to for every consumer product so that consumer products
ensure its safety have been established. shall be distributed in commerce only after inspection
and certification of its quality and safety standards by the
Article 11. Amendment and Revocation of department. The manufacturer shall avail of the
Declaration of the Injurious, Unsafe or Dangerous Philippine Standard Certification Mark which the
Character of a Consumer Product. – Any interested department shall grant after determining the product's
person may petition the appropriate department to compliance with the relevant standard in accordance
commence a proceeding for the issuance of an with the implementing rules and regulations.
amendment or revocation of a consumer product safety
rule or an order declaring a consumer product injurious, Article 15. Imported Products. –
dangerous and unsafe.
In case the department, upon petition by an a) Any consumer product offered for importation into the
interested party or its own initiative and after due notice customs of the Philippine territory shall be refused
and hearing, determines a consumer product to be admission if
substandard or materially defective, it shall so notify the such product:
manufacturer, distributor or seller thereof of such finding 1) fails to comply with an applicable consumer
and order such manufacturer, distributor or seller to: product quality and safety standard or rule;
a) give notice to the public of the defect or 2) is or has been determined to be injurious,
failure to comply with the product safety standards; and unsafe and dangerous;
b) give notice to each distributor or retailer of 3) is substandard; or
such product. 4) has material defect.

The department shall also direct the manufacturer, b) Samples of consumer products being imported into
distributor or seller of such product to extend any or all of the Philippines in a quantity necessary for purposes of
the following remedies to the injured person: determining the existence of any of the above causes for
a) to bring such product into conformity with the non-admission may be obtained by the concerned
requirements of the applicable consumer product department or agency without charge from the owner or
standards or to repair the defect in order to conform with consignee thereof. The owner or consignee of the
the same; imported consumer product under examination shall be
b) to replace the product with a like or afforded an opportunity to a hearing with respect to the
equivalent product which complies with the applicable importation of such products into the Philippines. If it
consumer product standards which does not contain the appears from examination of such samples or otherwise
defect; that an imported consumer product does not conform to
c) to refund the purchase price of the product the consumer product safety rule or is injurious, unsafe
less a reasonable allowance for use; and and dangerous, is substandard or has a material defect,
d) to pay the consumer reasonable damages as such product shall be refused admission unless the
may be determined by the department. owner or the consignee thereof manifests under bond
that none of the above ground for non-admission exists
The manufacturer, distributor or seller shall not charge a or that measures have been taken to cure them before
consumer who avails himself of the remedy as provided they are sold, distributed or offered for sale to the
above of any expense and cost that may be incurred. general public. Any consumer product, the sale or use of
Article 12. Effectivity of Amendments and which has been banned or withdrawn in the country of
Revocation of Consumer Product Safety Rule. – Any manufacture, shall not be
amendment or revocation of a consumer product safety imported into the country.
rule made by the concerned department shall specify the
date on which it shall take effect which shall not exceed
c) If it appears that any consumer product which may not c) to inspect and analyze consumer products for
be admitted pursuant to paragraph (a) of this Article can purposes of determining conformity to established
be so modified that it can already be accepted, the quality and safety standards;
concerned department may defer final examination as to
the admission of such product for a period not exceeding d) to levy, assess, collect and retain fees as are
ten (10) days, and in accordance with such regulations necessary to cover the cost of inspection, certification,
as the department and the Commissioner of Customs analysis and testsof samples of consumer products and
shall jointly promulgate, such product may be released materials submitted in compliance with the provisions of
from customs custody under bond for the purpose of this Article;
permitting the owner or consignee an opportunity to so
modify such product. e) to investigate the causes of and maintain a record of
product-related deaths, illnesses and injuries for use in
d) All modifications taken by an owner or consignee for researches or studies on the prevention of such product-
the purpose of securing admission of an imported related deaths, illnesses and injuries.
consumer product under paragraph (c) shall be subject
to the supervision of the concerned department. If the f) to accredit independent, competent non-government
product cannot be so modified, or if the owner or bodies, to assist in (1) monitoring the market for the
consignee is not proceeding to satisfactorily modify such presence of hazardous or non-certified products and
product, it shall be refused admission and the other forms of violations of Article 18; and (2) other
department may direct redelivery of the product into appropriate means to expand the monitoring and
customs custody, and to seize the product if not so enforcement outreach of the department in relation to its
redelivered. manpower, testing and certification resources at a given
time.
e) Imported consumer products not admitted must be
exported, except that upon application, the g) to accredit independent competent testing
Commissioner of Customs may permit the destruction of laboratories.
the product if, within a reasonable time, the owner or
consignee thereof fails to export the same. PROHIBITED ACTS AND PENALTIES

f) All expenses in connection with the destruction Article 18. Prohibited Acts. – It shall be unlawful for
provided for in this Article, and all expenses in any person to:
connection with the storage, cartage or labor with a) manufacture for sale, offer for sale, distribute in
respect to any consumer product refused admission commerce, or import into the Philippines any consumer
under this Article, shall be paid by the owner or product which is not in conformity with an applicable
consignee and, in default of such payment, shall consumer product quality or safety standard
constitute a lien against any future importation made by promulgated in this Act;
such owner or consignee. b) manufacture for sale, offer for sale, distribute in
commerce, or import into the Philippines any consumer
Article 16. Consumer Products for Export. – The product which has been declared as banned consumer
preceding article on safety not apply to any consumer product by a rule in this Act;
product if: c) refuse access to or copying of pertinent records or fail
or refuse to permit entry of or inspection by authorized
a) it can be shown that such product is manufactured, officers or employees of the department;
sold or held for sale for export from the Philippines, or d) fail to comply with an order issued under Article II
that such product was imported for export, unless such relating to notifications of substantial product hazards
consumer product is in fact distributed in commerce for and to recall,repair, replacement or refund of unsafe
use in the Philippines; and products;
b) such consumer product or the packaging thereof e) fail to comply with the rule prohibiting stockpiling.
bears a stamp or label stating that such consumer
product is intended for export and actually exported. Article 19. Penalties. –
a) Any person who shall violate any provision of Article
Article 17. Powers, functions and duties. – In addition 18 shall upon conviction, be subject to a fine of not less
to their powers, functions and duties under existing laws, than One thousand pesos (P1,000.00) but not more than
the concerned department shall have the following Ten thousand pesos (P10,000.00) or imprisonment of
powers, functions and duties: not less than two (2) months but not more than one (1)
year, or both upon the discretion of the court. If the
a) to administer and supervise the implementation of this offender is an alien, he shall be deported after service of
Article and its implementing rules and regulations; sentence and payment of fine without further deportation
b) to undertake researches, develop and establish proceedings.
quality and safety standards for consumer products in
coordination with other government and private agencies DECEPTIVE, UNFAIR AND UNCONSCIONABLE
closely associated with these products; SALES ACTS OR PRACTICES
Article 48. Declaration of Policy. – The State shall occurs before, during or after the consumer transaction.
promote and encourage fair, honest and equitable An act or practice shall be deemed unfair or
relations among parties in consumer transactions and unconscionable whenever the producer, manufacturer,
protect the consumer against deceptive, unfair and distributor, supplier or seller, by taking advantage of the
unconscionable sales acts or practices. consumer's physical or mental infirmity, ignorance,
illiteracy, lack of time or the general conditions of the
Article 49. Implementing Agency. – The Department of environment or surroundings, induces the consumer to
Trade and Industry, hereby referred to as the enter into a sales or lease transaction grossly inimical to
Department, shall enforce the provisions of this Chapter. the interests of the consumer or grossly one-sided in
favor of the producer, manufacturer, distributor, supplier
REGULATION OF SALES ACTS AND PRACTICES or seller.

Article 50. Prohibition Against Deceptive Sales Acts In determining whether an act or practice is unfair and
or Practices. – A deceptive act or practice by a seller or unconscionable, the following circumstances shall be
supplier in connection with a consumer transaction considered:
violates this Act whether it occurs before, during or after a) that the producer, manufacturer, distributor, supplier or
the transaction. An act or practice shall be deemed seller took advantage of the inability of the consumer to
deceptive whenever the producer, manufacturer, supplier reasonably protect his interest because of his inability to
or seller, through concealment, false representation of understand the language of an agreement, or similar
fraudulent manipulation, induces a consumer to enter factors;
into a sales or lease transaction of any consumer b) that when the consumer transaction was entered into,
product or service. the price grossly exceeded the price at which similar
products or services were readily obtainable in similar
Without limiting the scope of the above paragraph, the transaction by like consumers;
act or practice of a seller or supplier is deceptive when it c) that when the consumer transaction was entered into,
represents that: the consumer was unable to receive a substantial benefit
a) a consumer product or service has the sponsorship, from the subject of the transaction;
approval, performance, characteristics, ingredients, d) that when the consumer was entered into, the seller
accessories, uses, or benefits it does not have; or supplier was aware that there was no reasonable
b) a consumer product or service is of a particular probability or payment of the obligation in full by the
standard, quality, grade, style, or model when in fact it is consumer; and
not; e) that the transaction that the seller or supplier induced
c) a consumer product is new, original or unused, when the consumer to enter into was excessively one-sided in
in fact, it is in a deteriorated, altered, reconditioned, favor of the seller or supplier.
reclaimed or second-hand state;
d) a consumer product or service is available to the Article 53. Chain Distribution Plans or Pyramid Sales
consumer for a reason that is different from the fact; Schemes. – Chain distribution plans or pyramid sales
e) a consumer product or service has been supplied in schemes shall not be employed in the sale of consumer
accordance with the previous representation when in products.
fact it is not;
f) a consumer product or service can be supplied in a Article 54. Home Solicitation Sales. – No business
quantity greater than the supplier intends; entity shall conduct any home solicitation sale of any
g) a service, or repair of a consumer product is needed consumer product or service without first obtaining a
when in fact it is not; permit from the Department. Such permit may be denied
h) a specific price advantage of a consumer product suspended or revoked upon cause as provided in the
exists when in fact it does not; rules and regulations promulgated by the Department,
i) the sales act or practice involves or does not involve a after due notice and hearing.
warranty, a disclaimer of warranties, particular warranty
terms or other rights, remedies or obligations if the Article 55. Home Solicitation Sales; When
indication is false; and Conducted. – Home solicitation sales may be
j) the seller or supplier has a sponsorship, approval, or conducted only between the hours of nine o'clock in
affiliation he does not have. the morning and seven o'clock in the evening of each
working day: Provided, That solicitation sales may be
Article 51. Deceptive Sales Act or Practices By made at a time other than the prescribed hours where
Regulation. – The Department shall, after due notice the person solicited has previously agreed to the same.
and hearing, promulgate regulations declaring as Article 56. Home Solicitation Sales; by Whom
deceptive any sales act, practice or technique which is a Conducted. – Home solicitation sales shall only be
misrepresentation of facts other than these enumerated conducted by a person who has the proper identification
in Article 50. and authority from his principal to make such
solicitations.
Article 52. Unfair or Unconscionable Sales Act or
Practice. – An unfair or unconscionable sales act or Article 57. Receipts for Home Solicitation Sales. –
practice by a seller or supplier in connection with a Sales generated from home solicitation sales shall be
consumer transaction violates this Chapter whether it
properly receipted as per existing laws, rules and
regulations on sale transactions. The Department of Trade and Industry shall also adopt
standard measurement for garments, shoes and other
Article 58. Prohibited Representations. – A home similar consumer products.
solicitation sale shall not represent that:
a) the buyer has been specially selected; PROHIBITED ACTS
b) a survey, test or research is being conducted; or
c) the seller is making a special offer to a few persons Article 64. Fraudulent Practices Relative to Weights
only for a limited period of time. and Measures. – The following acts relating to weights
and measures are prohibited:
Article 59. Referral Sales. – Referral selling plans shall a) for any person other than the official sealer
not be used in the sale of consumer products unless the or his duly authorized representative to place or attach
seller executes in favor of the buyer a written an official tag, seal, sticker, mark, stamp, brand or other
undertaking that will grant a specified compensation or characteristic sign used to indicate that such instrument
other benefit to said buyer in return for each and every of weight and measure has officially been tested,
transaction consummated by said seller with the persons calibrated, sealed or inspected;
referred by said buyer or for subsequent sales that said b) for any person to imitate any seal, sticker,
buyers has helped the seller enter into. mark, stamp, brand, tag or other characteristic sign used
to indicate that such instrument of weight or measures
Article 60. Penalties. – has been officially tested, calibrated, sealed or
a) Any person who shall violate the provisions of Title III, inspected;
Chapter I, shall upon conviction, be subject to a fine of c) for any person other than the official sealer
not lessthan Five Hundred Pesos (P500.00) but not or his duly authorized representative to alter in any way
more than Ten Thousand Pesos (P10,000.00) or the certificate or receipt given by the official sealer or his
imprisonment of not less than five (5) months but not duly authorized representative as an acknowledgment
more than one (1) year or both, upon the discretion of that the instrument for determining weight or measure
the court. has been fully tested, calibrated, sealed or inspected;
b) In addition to the penalty provided for in paragraph d) for any person to make or knowingly sell or
(1), the court may grant an injunction restraining the use any false or counterfeit seal, sticker, brand, stamp,
conduct constituting the contravention of the provisions tag, certificate or license or any dye for printing or
of Articles 50 and 51 and/or actual damages and such making the same or any characteristic sign used to
other orders as it thinks fit to redress injury to the person indicate that such instrument of weight or measure has
caused by such conduct. been officially tested, calibrated, sealed or inspected;
e) for any person other than the official sealer
CHAPTER II or his duly authorized representative to alter the written
REGULATION OF PRACTICES RELATIVE TO or printed figures,letters or symbols on any official seal,
WEIGHTS AND MEASURES GENERAL PROVISION sticker, receipt, stamp, tag, certificate or license used or
issued;
Article 61. Implementing Agency. – The provincial, f) for any person to use or reuse any restored,
city, or municipal treasurers shall strictly enforce the altered, expired, damaged stamp, tag certificate or
provisions of this Chapter, and its implementing rules license for the purpose of making it appear that the
and regulations: Provided, That, with respect to the use instrument of weight of measure has been tested,
of the Metric System, it shall be enforced by the calibrated, sealed or inspected;
Department of Trade and Industry. g) for any person engaged in the buying and
selling of consumer products or of furnishing services
Article 62. Sealing and Testing of Instruments of the value of which is estimated by weight or measure to
Weights and Measure. – All instruments for determining possess, use or maintain with intention to use any scale,
weights and measures in all consumer and consumer balance, weight or measure that has not been sealed or
related transactions shall be tested, calibrated and if previously sealed, the license therefor has expired and
sealed every six (6) months by the official sealer who has not been renewed in due time;
shall be the provincial or city or municipal treasurer or h) for any person to fraudulently alter any scale,
his authorized representative upon payment of fees balance, weight, or measure after it is officially sealed;
required under existing law: Provided, That all i) for any person to knowingly use any false
instruments of weights and measures shall continuously scale, balance, weight or measure, whether sealed or
be inspected for compliance with the provisions of this not;
Chapter. j) for any person to fraudulently give short
weight or measure in the making of a scale;
Article 63. Use of Metric System. – The system of k) for any person, assuming to determine truly
weights and measures to be used for all products, the weight or measure of any article bought or sold by
commodities, materials, utilities, services and weight or measure, to fraudulently misrepresent the
commercial transactions, in all contracts, deeds and weight or measure thereof; or
other official and legal instruments and documents shall l) for any person to procure the commission of
be the metric system, in accordance with existing laws any such offense abovementioned by another.
and their implementing rules and regulations. Instruments officially sealed at some previous time which
have remained unaltered and accurate and the seal or b) Express warranty – operative from moment
tag officially affixed thereto remains intact and in the of sale. – All written warranties or guarantees issued by
same position and condition in which it was placed by a manufacturer, producer, or importer shall be operative
the official sealer or his duly authorized representative from the moment of sale.
shall, if presented for sealing, be sealed promptly on 1) Sales Report. – All sales made by distributors of
demand by the official sealer or his authorized products covered by this Article shall be reported to the
representative without penalty except a surcharge manufacturer, producer, or importer of the product sold
fixed by law or regulation. within thirty (30) days from date of purchase, unless
otherwise agreed upon. The report shall contain, among
Article 65. Penalties. – others, the date of purchase, model of the product
a) Any person who shall violate the provisions bought, its serial number, name and address of the
of paragraphs (a) to (f) and paragraph (l) of Article 64 or buyer. The report made in accordance with this provision
its implementing rules and regulations shall, upon shall be equivalent to a warranty registration with the
conviction, be subject to a fine of not less than Two manufacturer, producer, or importer. Such registration is
hundred pesos (P200.00) but not more than One sufficient to hold the manufacturer, producer, or importer
thousand pesos (P1,000.00) or by imprisonment of not liable, in appropriate cases, under its warranty.
more than one (1) year or both upon the discretion of the 2) Failure to make or send report. – Failure of the
court. distributor to make the report or send them the form
b) Any person who shall violate the provisions required by the manufacturer, producer, or importer shall
of paragraph (g) of Article 64 for the first time shall be relieve the latter of its liability under the warranty:
subject to a fine of not less than Five hundred pesos Provided, however, That the distributor who failed to
(P500.00) or by imprisonment of not less than one (1) comply with its obligation to send the sales reports shall
month but not more than five (5) years or both, upon the be personally liable under the warranty. For this purpose,
discretion of the court. the manufacturer shall be obligated to make good the
c) The owner-possessor or user of instrument warranty at the expense of the distributor.
of weights and measure enumerated in paragraphs (h) 3) Retail. – The retailer shall be subsidiarily liable under
to (k) of Article 64 shall, upon conviction, be subject to a the warranty in case of failure of both the manufacturer
fine of not less than Three hundred pesos (P300.00) or and distributor to honor the warranty. In such case, the
imprisonment not exceeding one (1) year, or both, upon retailer shall shoulder the expenses and costs necessary
the discretion of the court. to honor the warranty. Nothing therein shall prevent the
retailer from proceeding against the distributor or
CONSUMER PRODUCT AND SERVICE WARRANTIES manufacturer.
4) Enforcement of warranty or guarantee. – The
Article 66. Implementing Agency. – The Department of warranty rights can be enforced by presentment of a
Trade and Industry, shall strictly enforce the provision of claim. To this end, the purchaser needs only to present
this Chapter and its implementing rules and regulations. to the immediate seller either the warranty card of the
official receipt along with the product to be serviced or
Article 67. Applicable Law on Warranties. – The returned to the immediate seller. No other documentary
provisions of the Civil Code on conditions and warranties requirement shall be demanded from the purchaser. If
shall govern all contracts of sale with conditions and the immediate seller is the manufacturer's factory or
warranties. showroom, the warranty shall immediately be honored. If
the product was purchased from a distributor, the
Article 68. Additional Provisions on Warranties. – In distributor shall likewise immediately honor the warranty.
addition to the Civil Code provisions on sale with In the case of a retailer other than the distributor, the
warranties, the following provisions shall govern the sale former shall take responsibility without cost to the buyer
of consumer products with warranty: of presenting the warranty claim to the distributor in the
consumer's behalf.
a) Terms of express warranty. – Any seller or 5) Record of purchases. – Distributors and retailers
manufacturer who gives an express warranty shall: covered by this Article shall keep a record of all
1) set forth the terms of warranty in clear and readily purchases covered by a warranty or guarantee for such
understandable language and clearly identify himself as period of time corresponding to the lifetime of the
the warrantor; product's respective warranties or guarantees.
2) identify the party to whom the warranty is extended; 6) Contrary stipulations – null and void. – All covenants,
3) state the products or parts covered; stipulations or agreements contrary to the provisions of
4) state what the warrantor will do in the event of a this Article shall be without legal effect.
defect, malfunction of failure to conform to the written
warranty and at whose expense; c) Designation of warranties. – A written warranty shall
5) state what the consumer must do to avail of the rights clearly and conspicuously designate such warranty as:
which accrue to the warranty; and 1) "Full warranty" if the written warranty meets the
6) stipulate the period within which, after notice of defect, minimum requirements set forth in paragraph (d); or
malfunction or failure to conform to the warranty, the 2) "Limited warranty" if the written warranty does not
warrantor will perform any obligation under the warranty. meet such minimum requirements.
d) Minimum standards for warranties. – For the that it is unreasonable for him to rely, on the seller's skill
warrantor of a consumer product to meet the minimum or judgment.
standards for warranty, he shall:
1) remedy such consumer product within a reasonable Article 70. Professional Services. – The provision of
time and without charge in case of a defect, malfunction this Act on warranty shall not apply to professional
or failure to conform to such written warranty; services of certified public accountants, architects,
2) permit the consumer to elect whether to ask for a engineers, lawyers, veterinarians, optometrists,
refund or replacement without charge of such product or pharmacists, nurses, nutritionists, dietitians, physical
part, as the case may be, where after reasonable therapists, salesmen, medical and dental practitioners
number of attempts to remedy the defect or malfunction, and other professionals engaged in their respective
the product continues to have the defect or to professional endeavors.
malfunction.
The warrantor will not be required to perform the above Article 71. Guaranty of Service Firms. – Service firms
duties if he can show that the defect, malfunction or shall guarantee workmanship and replacement of spare
failure to conform to a written warranty was caused by parts for a period not less than ninety (90) days which
damage due to unreasonable use thereof. shall be indicated in the pertinent invoices

e) Duration of warranty. – The seller and the consumer Article 72. Prohibited Acts. – The following acts are
may stipulate the period within which the express prohibited:
warranty shall be enforceable. If the implied warranty on a) refusal without any valid legal cause by the total
merchantability accompanies an express warranty, both manufacturer or any person obligated under the
will be of equal duration. warranty or guarantee to honor a warranty or guarantee
Any other implied warranty shall endure not less than issued;
sixty (60) days nor more than one (1) year following the b) unreasonable delay by the local manufacturer or any
sale of new consumer products. person obligated under the warranty or guarantee in
honoring the warranty;
f) Breach of warranties. – 1) In case of breach of express c) removal by any person of a product's warranty card
warranty, the consumer may elect to have the goods for the purpose of evading said warranty obligation;
repaired or its purchase price refunded by the warrantor. d) any false representation in an advertisement as to the
In case the repair of the product in whole or in part is existence of a warranty or guarantee.
elected, the warranty work must be made to conform to
the express warranty within thirty (30) days by either the Article 73. Penalties. –
warrantor or his representative. The thirty-day period, a) Any person who shall violate the provisions of Article
however, may be extended by conditions which are 67 shall be subject to fine of not less than Five hundred
beyond the control of the warrantor or his pesos (P500.00) but not more than Five thousand pesos
representative. In case the refund of the purchase price (P5,000.00) or an imprisonment of not less than three (3)
is elected, the amount directly attributable to the use of months but not more than two (2) years or both upon the
the consumer prior to the discovery of the non- discretion of the court. A second conviction under this
conformity shall be deducted. paragraph shall also carry with it the penalty or
2) In case of breach of implied warranty, the revocation of his business permit and license.
consumer may retain in the goods and recover
damages, or reject the goods, cancel and contract and b) Any person, natural or juridical, committing any of the
recover from the seller so much of the purchase price as illegal acts provided for in Chapter III, except with
has been paid, including damages. respect to Article 67, shall be liable for a fine of not less
than One thousand pesos (P1,000.00) but not more than
.– Fifty thousand pesos (P50,000.00) or imprisonment for a
a) In every contract for the supply of services to a period of at least one (1) year but not more than five (5)
consumer made by a seller in the course of a business, years, or both, at the
there is an discretion of the court.
implied warranty that the service will be rendered with The imposition of any of the penalties herein provided is
due care and skill and that any material supplied in without prejudice to any liability incurred under the
connection with such services will be reasonably fit for warranty or guarantee.
the purpose for which it is supplied.
LABELING AND FAIR PACKAGING
b) Where a seller supplies consumer services in the
course of a business and the consumer, expressly or by Article 74. Declaration of Policy. – The State shall
implication, makes known to the seller the particular enforce compulsory labeling, and fair packaging to
purpose for which the services are required, there is an enable the consumer to obtain accurate information as
implied warranty that the services supplied under the to the nature, quality and quantity of the contents of
contract and any material supplied in connection consumer products and to facilitate his comparison of
therewith will be reasonably fit for that purpose or are of the value of such products.
such a nature or quality that they might reasonably be
expected to achieve that result, unless the Article 75. Implementing Agency. – The Department of
circumstances show that the consumer does not rely or Trade and Industry shall enforce the provisions of this
Chapter and its implementing rules and regulations: Article 78. Philippine Product Standard Mark. – The
Provided, That with respect to food, drugs, cosmetics, label may contain the Philippine Product Standard Mark
devices and hazardous substances, it shall be enforced if it is certified to have passed the consumer product
by the concerned department. standard prescribed by the concerned department.

Article 76. Prohibited Acts on Labeling and Article 79. Authority of the Concerned Department to
Packaging. – It shall be unlawful for any person, either Provide for Additional Labeling and Packaging
as principal or agent, engaged in the labeling or Requirements. – Whenever the concerned department
packaging of any consumer product, to display or determines that regulations containing requirements
distribute or to cause to be displayed or distributed in other than those prescribed in Article 77 hereof are
commerce any consumer product whose package or necessary to prevent the deception of the consumer or
label does not conform to the provisions of this Chapter. to facilitate value comparisons as to any consumer
The prohibition in this Chapter shall not apply to persons product, it may issue such rules and regulations to:
engaged in the business of wholesale or retail
distributors of consumer products except to the extent a) establish and define standards for characterization of
that such persons: the size of a package enclosing any consumer product
a) are engaged in the packaging or labeling of such which may be used to supplement the label statement of
products; net quality, of contents of packages containing such
b) prescribe or specify by any means the manner in products but this clause shall not be construed as
which such products are packaged or labeled; or authorizing any limitation on the size, shape, weight,
c) having knowledge, refuse to disclose the source of the dimensions, or number of packages which may be used
mislabeled or mispackaged products. to enclose any product;
b) regulate the placement upon any package containing
Article 77. Minimum Labeling Requirements for any product or upon any label affixed to such product of
Consumer Products. – All consumer products any printed matter stating or representing by implication
domestically sold whether manufactured locally or that such product is offered for retail at a price lower
imported shall indicate the following in their respective than the ordinary and customary retail price or that a
labels of packaging: price advantage is accorded to purchases thereof by
a) its correct and registered trade name or brand name; reason of the size of the package or the quantity of its
b) its duly registered trademark; contents;
c) its duly registered business name; c) prevent the nonfunctional slack-fill of packages
d) the address of the manufacturer, importer, repacker of containing consumer products.
the consumer product in the Philippines;
e) its general make or active ingredients; For purposes of paragraph (c) of this Article, a package
f) the net quality of contents, in terms of weight, measure shall be deemed to be nonfunctionally slack-filled if it is
or numerical count rounded of to at least the nearest filled to substantially less than its capacity for reasons
tenths in the metric system; other than (1) protection of the contents of such
g) country of manufacture, if imported; and package, (2) the requirements of machines used for
h) if a consumer product is manufactured, refilled or enclosing the contents in such package, or (3) inherent
repacked under license from a principal, the label shall characteristics of package materials or construction
so state the fact. being used.

The following may be required by the concerned Article 80. Special Packaging of Consumer Products
department in accordance with the rules and regulations for the Protection of Children. – The concerned
they will promulgate under authority of department may establish standards for the special
this Act: packaging of any consumer product if it finds that:
a) whether it is flammable or inflammable; a) the degree or nature of the hazard to children in the
b) directions for use, if necessary; availability of such product, by reason of its packaging, is
c) warning of toxicity; such that special packaging is required to protect
d) wattage, voltage or amperes; or children from serious personal injury or serious illness
e) process of manufacture used if necessary. resulting from handling and use of such product; and
Any word, statement or other information required by or b) the special packaging to be required by such standard
under authority of the preceding paragraph shall appear is technically feasible, practicable and appropriate for
on the label or labeling with such conspicuousness as such product. In establishing a standard under this
compared with other words, statements, designs or
devices therein, and in such terms as to render it likely to Article, the concerned department shall consider:
be read and understood by the ordinary individual under 1) the reasonableness of such standard;
customary conditions of purchase or use. 2) available scientific, medical and engineering data
concerning special packaging and concerning
The above requirements shall form an integral part of the accidental, ingestions, illnesses and injuries caused by
label without danger of being erased or detached under consumer product;
ordinary handling of the product. 3) the manufacturing practices of industries affected by
this Article; and
4) the nature and use of consumer products.
 with other words, statements, designs or devices in the
Article 81. Price Tag Requirement. – It shall be labeling and in such terms as to render it likely to be
unlawful to offer any consumer product for retail sale to read and understood by the ordinary individual under
the public without an appropriate price tag, label or customary conditions of purchase and use;
marking publicly displayed to indicate the price of each g) if it purports to be or is represented as a food for
article and said products shall not be sold at a price which a definition or standard of identity has been
higher than that stated therein and without discrimination prescribed unless:
to all buyers: Provided, That lumber sold, displayed or 1) it conforms to such definition and standard;
offered for sale to the public shall be tagged or labeled and
by indicating thereon the price and the corresponding 2) its labels bears the name of the food
official name of the wood: Provided, further, That if specified in the definition or standards, and insofar as
consumer products for sale are too small or the nature of may be required by such regulations, the common
which makes it impractical to place a price tag thereon names of optional ingredients other than spices,
price list placed at the nearest point where the products flavoring and coloring, present in such food;
are displayed indicating the retail price of the same may
suffice. h) if it purports to be or represented as:
1) a food for which a standard of quality has
Article 82. Manner of Placing Price Tags. – Price tags, been prescribed by regulations as provided in this Act
labels or markings must be written clearly, indicating the and its quality fall below such standard, unless its label
price of the consumer product per unit in pesos and bears in such manner and form as such regulations
centavos. specify, a statement that it falls below such standard; or
2) a food for which a standard or standards or
Article 83. Regulations for Price Tag Placement. – fill of container have been prescribed by regulations as
The concerned department shall prescribe rules and provided by this Act and it falls below the standard of fill
regulations for the visible placement of price tags for of container applicable thereto, unless its label bears, in
specific consumer products and services. There shall be such manner and form as such regulations specify, a
no erasures or alterations of any sort of price tags, labels statement that it falls below such standard;
or markings.
i) if it is not subject to the provisions of paragraph (g) of
Article 84. Additional Labeling Requirements for this Article unless its label bears:
Food. – The following additional labeling requirements 1) the common or usual name of the food, if
shall be imposed by the concerned department for food: there be any; and
2) in case it is manufactured or processed from
a) expiry or expiration date, where applicable; two or more ingredients, the common or usual name of
b) whether the consumer product is semi-processed, such ingredient; except the spices, flavorings and
fully processed, ready-to-cook, ready-to-eat, prepared colorings other than those sold as such, may be
food or just plain mixture; designated as spices, flavorings and colorings without
c) nutritive value, if any; naming each: Provided, That to the extent that
d) whether the ingredients use are natural or synthetic, compliance with the requirement of clause (2) of this
as the case may be; paragraph is impracticable or results in deception or
e) such other labeling requirements as the concerned unfair competition, exemptions shall be established by
department may deem necessary and reasonable. regulations promulgated by the concerned department of
health;
Article 85. Mislabeled Food. – A food shall also be j) if it purports to be or is represented for special dietary
deemed mislabeled: uses, unless its label bears such information concerning
a) if its labeling or advertising is false or misleading in its vitamin or mineral or other dietary properties as the
any way; concerned department determines to be, or by
b) if it is offered for sale under the name of another food; regulations prescribed as necessary in order fully to
c) if it is an imitation of another food, unless its label inform purchasers as its value for such uses;
bears in type of uniform size and prominence, the word k) if it bears or contains any artificial flavoring, artificial
"imitation" and, immediately thereafter, the name of the coloring, or chemical preservative, unless it bears
food imitated; labeling, stating that fact: Provided, That to the extent
d) its containers is so made, formed, or filled as to be that compliance with the requirements of this paragraph
misleading; is impracticable, exemptions shall be established by
e) if in package form unless it bears a label conforming regulations promulgated by the concerned department.
to the requirements of this Act: Provided, That The provisions of this paragraph or paragraphs (g) and
reasonable variation on the requirements of labeling (i) with respect to the artificial coloring shall not apply in
shall be permitted and exemptions as to small packages the case of butter, cheese or ice cream.
shall be established by the regulations prescribed by the
concerned department of health; Article 86. Labeling of Drugs. – The Generics Act shall
f) if any word, statement or other information required by apply in the labeling of drugs.
or under authority of this Act to appear on the principal
display panel of the label or labeling is not prominently
placed thereon with such conspicuousness as compared
Article 87. Additional Labeling Requirements for 1) adequate directions for use; and
Cosmetics. – The following additional requirements may 2) such adequate warning against use in those
be required for cosmetics: pathological conditions or by children where its use may
a) expiry or expiration date; be dangerous to health, or against unsafe dosage or
b) whether or not it may be an irritant; methods or duration of administration or application, in
c) precautions or contra-indications; and such manner and form, as are necessary for the
d) such other labeling requirements as the concerned protection of users: Provided, That where any
department may deem necessary and reasonable. requirement of clause (1) of this paragraph, as applied to
any drug or device, is not necessary for the protection of
Article 88. Special Labeling Requirements for the public health, the concerned department may
Cosmetics. – A cosmetic shall be deemed mislabeled: promulgate regulations exempting such drug or device
a) if its labeling or advertising is false or misleading in from such requirement;
any way;
b) if in package form unless it bears a label conforming f) if it purports to be a drug the name of which is
to the requirements of labeling provided for in this Act or recognized in an official compendium, unless it is
under existing regulations: Provided, That reasonable packaged and labeled as prescribed therein: Provided,
variations shall be permitted, and exemptions as to small That the method of packing may be modified with the
packages shall be established by regulations prescribed consent of the concerned department;
by the concerned department;
c) if any word, statement or other information required by g) if it has been found by the concerned department to
or under authority of this Act to appear on the label or be a drug liable to deterioration, unless it is packaged in
labeling isnot prominently placed thereon with such such form and manner, and its label bears a statement
conspicuousness, as compared with other words, of such precautions, as the concerned department, shall
statements, designs or devices in the labeling, and in by regulations, require as necessary for the protection of
such terms as to render it likely to be read and the public health;
understood by the ordinary individual under customary
conditions of purchase and use; h) 1) if it is a drug and its container is so made, formed
d) if its container is so made, formed or filled as to be or filled as to be misleading; or 2) if it is an imitation of
misleading; or another drug; or 3) if it is dangerous to health when used
e) if its label does not state the common or usual name in the dosage, or with the frequency of duration
of its ingredients. prescribed, recommended or suggested in the labeling
thereof;
Article 89. Mislabeled Drugs and Devices. – A drug or
device shall be deemed to be mislabeled: j) if it is, purports to be or is represented as a drug
a) if its labeling is false or misleading in any way; composed wholly or partly of insulin or of any kind of
penicillin, streptomycin, chlortetracycline,
b) if its in package form unless it bears a label chloramphenicol, bacitracin, or any other antibiotic drug,
conforming to the requirements of this Act or the or any derivative thereof, unless:
regulations promulgated therefor: Provided, that 1) it is from a batch with respect to which a certificate of
reasonable variations shall be permitted and exemptions release has been issued pursuant to regulations of the
as to small packages shall be established by regulations concerned department; and
prescribed by the concerned department. 2) such certificate of release is in effect with respect to
c) if any word, statement or other information required by such drug: Provided, That this paragraph shall not apply
or under authority of this Act to appear on the principal to any drug or class of drugs exempted by regulations
display panel of the label or labeling is not prominently promulgated under Authority of this Act.
placed thereon with such conspicuousness as compared
with other words, statements, designs or devices in the Article 90. Regulation-making Exemptions. – The
labeling and in such terms as to render it likely to be concerned department may promulgate regulations
read and understood by the ordinary individual under exempting from any labeling requirements of this Act
customary conditions of purchase and use; food, cosmetics, drugs or devices which are, in
accordance with the practice of trade, to be processed,
d) if it is for use by man and contains any quantity of the labeled or repacked in substantial quantities at
narcotic or hypnotic substance alpha-eucaine, barbituric establishments other than those where originally
acid, beta-eucaine, bromal, cannabis, carbromal, chloral, processed, labeled or packed on condition that such
coca, cocaine, codeine, heroin, marijuana, morphine, food, cosmetics, drugs or devices are not adulterated or
opium, paraldehyde, peyote or sulfonmethane, or any mislabeled under the provisions of this Act and other
chemical derivative of such substance, which derivative applicable laws upon approval from such
has been designated by the concerned department after processing, labeling and repacking establishments.
investigation, and by regulations as habit forming; unless
its label bears the name and quantity or proportion of Article 91. Mislabeled Hazardous Substances. –
such substance or derivative and in juxtaposition Hazardous substances shall be deemed mislabeled
therewith the statement "Warning-May be habit forming"; when:
a) having been intended or packaged in a form suitable
e) its labeling does not bear: for use in households, especially for children, the
packaging or labeling of which is in violation of the order of the concerned department in accordance with
special packaging regulations issued by the concerned existing procedure for seizure and condemnation of
department; articles in commerce: Provided, That this Article shall not
b) such substance fails to bear a label; apply to a hazardous substance intended for export to
any foreign country if:
1) which states conspicuously: 1) it is in a package labeled in accordance with
(i) the name and the place of business of the the specifications of the foreign purchaser;
manufacturer, packer, distributor or seller; 2) it is labeled in accordance with the laws of
(ii) the common or usual name or the chemical name, if the foreign country;
there be no common or usual name, of the hazardous 3) it is labeled on the outside of the shipping
substance or of each component which contributes package to show that it is intended for export; and
substantially to the harmfulness of the substance, unless 4) it is so exported,
the concerned department by regulation permits or b) any hazardous substance condemned under this
requires the use of the recognized generic name; Article shall after entry of order of condemnation be
(iii) the signal word "danger" on substances which are disposed of by destruction or sale as the concerned
extremely flammable, corrosive or highly toxic; department may direct, and the proceeds thereof, if sold,
(iv) the signal word "warning" or "caution" with a bright less the legal cost and charges, shall be paid into the
red or orange color with a black symbol on all other treasury of the Philippines; but such hazardous
hazardous substances; substance shall not be sold under any order which is
(v) a clear statement as to the possible injury it may contrary to the provisions of this Act; Provided, That,
cause if used improperly; after entry of the order and upon the payment of the
(vi) precautionary measures describing the action to be costs of such proceedings and the execution of a good
followed or avoided; and sufficient bond conditioned that such hazardous
(vii) instructions when necessary or appropriate for first- substance shall not be sold or disposed of contrary to
aid treatment; the provisions of this Act, the concerned department may
(viii) the word" poison" for any hazardous substance direct that such hazardous substance be delivered to or
which is defined as highly toxic; retained by the owner thereof for destruction or for
(ix) instructions for handling and storage of packages alteration to comply with the provisions of this Act under
which require special care in handling and the supervision of an officer or employee duly
storage; and designated by the concerned department. The expenses
(x) the statement "keep out of the reach of children", or for such supervision shall be paid by the person
its practical equivalent, if the article is not intended for obtaining release of the hazardous substance under
use by children and is not a banned hazardous bond.
substance, with adequate directions for the protection of c) all expenses in connection with the destruction
children from the hazard involved. The aforementioned provided for in paragraphs (a) and (b) of this Article and
signal words, affirmative statements, description of all expenses in connection with the storage and labor
precautionary measures, necessary instructions or other with respect to such hazardous substance shall be paid
words or statements may be in English language or its by the owner or consignee, and default in such payment
equivalent in Filipino; and shall constitute a lien against any importation by such
owner or consignee.
2) on which any statement required under Article 94. Labeling Requirements of Cigarettes. – All
clause 1) of this paragraph is located prominently in cigarettes for sale or distribution within the country shall
bright red and orange color with a black symbol in be contained in a package which shall bear the following
contrast typography, layout or color with the other printed statement or its equivalent in Filipino: "Warning"
matters on the label. Cigarette Smoking is Dangerous to Your Health". Such
statement shall be located in conspicuous place on
Article 92. Exemptions. – If the concerned department every cigarette package and shall appear in conspicuous
finds that for good or sufficient reasons, full compliance and legible type in contrast by typography, layout or
with the labeling requirements otherwise applicable color with other printed matter on the package. Any
under this Act is impracticable or is not necessary for the advertisement of cigarette shall contain the name
adequate protection of public health and safety, it shall warning as indicated in the label.
promulgate regulations exempting such substances from
these requirements to the extent it deems consistent Article 95. Penalties. –
with the objective of adequately safeguarding public a) Any person who shall violate the provisions of Title III,
health and safety, and any hazardous substance which Chapter IV of this Act, or its implementing rules and
does not bear a label in accordance with such regulations, except Articles 81 to 83 of the same
regulations shall be deemed mislabeled hazardous Chapter, shall be subject to a fine of not less than Five
substance. hundred pesos (P500.00) but not more than Twenty
thousand pesos (P20,000.00) or imprisonment of not
Article 93. Grounds for Seizure and Condemnation less than three (3) months but not more than two (2)
of Mislabeled Hazardous Substances. – years or both, at the discretion of the court: Provided,
a) Any mislabeled hazardous substance when That, if the consumer product is one which is not a food,
introduced into commerce or while held for sale shall be cosmetic, drug, device or hazardous substance, the
liable to be proceeded against and condemned upon penalty shall be a fine of not less than Two hundred
pesos (P200.00) but not more than Five thousand pesos Section 5. Repair Attempts. – At any time within the
(P5,000.00) or imprisonment of not less than one (1) Lemon Law rights period, and after at least four (4)
month but not more than one (1) year or both, at the separate repair attempts by the same manufacturer,
discretion of the court. distributor, authorized dealer or retailer for the same
complaint, and the nonconformity issue remains
b) Any person who violates the provisions of Article 81 to unresolved, the consumer may invoke his or her rights
83 for the first time shall be subject to a fine of not less under this Act.
than Two hundred pesos (P200.00) but not more than
Five thousand pesos (P5,000.00) or by imprisonment of The repair may include replacement of parts
not less than one (1) month but not more than six (6) components, or assemblies.
months or both, at the discretion of the court. A second
conviction under this paragraph shall also carry with it Section 6. Notice of Availment of Lemon Law Rights.
the penalty of revocation of business permit and license. – Before availing of any remedy under this Act and
subject to compliance with the provisions of Section 5
hereof, the consumer shall, in writing, notify the
LEMON LAW manufacturer, distributor, authorized dealer or retailer of
the unresolved complaint, and the consumer’s intention
REPUBLIC ACT NO. 10642 to invoke his or her rights under this Act within the
AN ACT STRENGTHENING CONSUMER Lemon Law rights period.
PROTECTION IN THE PURCHASE OF BRAND NEW
MOTOR VEHICLES The warranty booklet issued by the manufacturer,
distributor, authorized dealer or retailer shall clearly state
Be it enacted by the Senate and House of the manner and form of such notice to constitute a valid
Representatives of the Philippines in Congress and legal notice to the manufacturer, distributor,
assembled: authorized dealer or retailer. It shall also clearly state the
responsibility of the consumer under this section.
Section 1. Short Title. – This Act shall be known as the
"Philippine Lemon Law". Section 7. Availment of Lemon Law Rights. –
Subsequent to filing the notice of availment referred to in
Section 2. Declaration of Policy. – It is hereby the preceding section, the consumer shall bring the
declared the policy of the State to promote full protection vehicle to the manufacturer, distributor, authorized dealer
to the rights of consumers in the sale of motor vehicles or retailer from where the vehicle was purchased for a
against business and trade practices which are final attempt to address the complaint of the consumer to
deceptive, unfair or otherwise inimical to consumers and his or her satisfaction.
the public interest.
It shall be the duty of the manufacturer, distributor,
The State recognizes that a motor vehicle is a major authorized dealer or retailer, upon receipt of the motor
consumer purchase or investment. Hence, the rights of vehicle and the notice of nonconformity required under
consumers should be clearly defined, including the Section 6 hereof, to attend to the complaints of the
means for redress for violations thereof. consumer including, as may be necessary, making the
repairs and undertaking such actions to make the
Section 3. Definition of Terms. – As used in this Act: vehicle conform to the standards or specifications of the
manufacturer, distributor, authorized dealer or retailer for
Section 4. Coverage. – This Act shall cover brand new such vehicle.
motor vehicles purchased in the Philippines reported by
a consumer to be in nonconformity with the vehicle’s In case the nonconformity issue remains unresolved
manufacturer or distributor’s standards or specifications despite the manufacturer, distributor, authorized dealer
within twelve (12) months from the date of .original or retailer’s efforts to repair the vehicle, pursuant to the
delivery to the consumer, or up to twenty thousand consumer’s availment of his or her Lemon Law rights,
(20,000) kilometers of operation after such delivery, the consumer may file a complaint before the DTI as
whichever comes first. The following causes of provided for under this Act: Provided, however, That if
nonconformity shall be excluded: the vehicle is not returned for repair, based on the same
complaint, within thirty (30) calendar days from the date
(a) Noncompliance by the consumer of the obligations of notice of release of the motor vehicle to the consumer
under the warranty; following this repair attempt within the Lemon Law rights
period, the repair is deemedsuccessful: Provided, finally,
(b) Modifications not authorized by the manufacturer, That, in the event that the nonconformity issue still exists
distributor, authorized dealer or retailer; or persists after the thirty (30)-day period but still within
the Lemon Law rights period, the consumer may be
(c) Abuse or neglect of the brand new motor vehicle; and allowed to avail of the same remedies under Sections 5
and 6 hereof.
(d) Damage to the vehicle due to accident or force
majeure. To compensate for the non-usage of the vehicle while
under repair and during the period of availment of the
Lemon Law rights, the consumer shall be provided a (1) In the event that both parties do not undertake
reasonable daily transportation allowance, an amount arbitration proceedings, at least one of the parties may
which covers the transportation of the consumer from his commence adjudication proceedings, administered by
or her residence to his or her regular workplace or the DTI. The DTI shall rely on the qualified independent
destination and vice versa, equivalent to air-conditioned findings as to conformity to standards and specifications
taxi fare, as evidenced by official receipt, or in such established herein. In no case shall adjudication
amount to be agreed upon by the parties, or a service proceedings exceed twenty (20) working days;
vehicle at the option of the manufacturer, distributor,
authorized dealer or retailer. Any disagreement on this (2) In case a finding of nonconformity is arrived at, the
matter shall be resolved by the DTI. DTI shall rule in favor of the consumer and direct the
manufacturer, distributor, authorized dealer or retailer to
Nothing herein shall be construed to limit or impair the grant either of the following remedies to the consumer:
rights and remedies of a consumer under any other law.
(i) Replace the motor vehicle with a similar or
Section 8. Remedies for Dispute Resolution. – The comparable motor vehicle in terms of specifications and
DTI shall exercise exclusive and original jurisdiction over values, subject to availability; or
disputes arising from the provisions of this Act. All
disputes arising from the provisions of this Act shall be (ii) Accept the return of the motor vehicle and pay the
settled by the DTI in accordance with the following consumer the purchase price plus the collateral charges.
dispute resolution mechanisms:
In case the consumer decides to purchase another
(a) Mediation vehicle with a higher value and specifications from the
same manufacturer, distributor, authorized dealer or
(1) The principles of negotiation, conciliation and retailer, the consumer shall pay the difference in cost.
mediation towards amicable settlement between the
manufacturer, distributor, authorized dealer or retailer In both cases of replacement and repurchase, the
and the consumer shall be strictly observed; reasonable allowance for use, as defined in this Act,
shall be deducted in determining the value of the
(2) In the course of its dispute resolution efforts, the DTI nonconforming motor vehicle; and
shall endeavor to independently establish the validity of
the consumer’s outstanding complaint. The DTI shall (3) In case a nonconformity of the motor vehicle is not
likewise retain the services of other government found by the DTI, it shall rule in favor of the
agencies or qualified independent private entities in the manufacturer, distributor, .authorized dealer or retailer,
ascertainment of the validity of the consumer’s and direct the consumer to reimburse the manufacturer,
complaint. Any cost incurred in establishing the validity distributor, authorized dealer or retailer the costs
of the consumer’s complaint shall be bornejointly by the incurred by the latter in validating the consumer’s
consumer and the manufacturer, distributor, authorized complaints.
dealer or retailer;
An appeal may be taken from a final judgment or order
(3) The complaint shall be deemed valid if it is of the Adjudication Officer which completely disposes of
independently established that the motor vehicle does the case within fifteen (15) days from receipt
not conform to the standards or specifications set by the thereof.1âwphi1 The appeal shall be taken by filing a
manufacturer, distributor, authorized dealer or retailer; Memorandum of Appeal with the Secretary of the DTI,
with Notice of Appeal to the Adjudication Officer, and
(4) Upon failure of the negotiation or mediation between with a copy duly furnished the adverse party or parties
the manufacturer, distributor, authorized, dealer or on any of the following grounds:
retailer and the consumer, the parties shall execute a
certificate attesting to such failure; and (i) Grave abuse of discretion;

(5) At any time during the dispute resolution period, the (ii) The decision/order is in excess of jurisdiction or
manufacturer, distributor, authorized dealer or retailer authority of the Adjudication Officer; and
and the consumer shall be encouraged to settle
amicably. All disputes that have been submitted for (iii) The decision/order is not supported by the evidence
mediation shall be settled not later than ten (10) working or there is serious error in the findings of facts.
days from the date of filing of the complaint with the DTI.
The Secretary of the DTI shall decide on the appeal
(b) Arbitration within thirty (30) days from receipt thereof. A party
seeking further appeal from the decision of the Secretary
In the event there is a failure to settle the complaint of the DTI may file a case for certiorari to the Court of
during the mediation proceedings, both parties may Appeals under Section 4, Rule 65 of the Revised Rules
voluntarily decide to undertake arbitration proceedings. of Court.

(c) Adjudication Section 9. Determination of Reasonable Allowance

for Use. – For purposes of this Act, "reasonable
allowance for use" shall mean twenty percent (20%) per
annum deduction from the purchase price, or the product
of the distance traveled in kilometers and the purchase
price divided by one hundred thousand (100,000)
kilometers, whichever is lower.

Section 10. Disclosure on Resale. – Should the

returned motor vehicle be made available for resale, the
manufacturer, distributor, authorized dealer or retailer
shall, prior to sale or transfer, disclose in writing to the
next purchaser of the same vehicle the following
information:

(a) The motor vehicle was returned to the manufacturer,

distributor, authorized dealer or retailer;

(b) The nature of the nonconformity which caused the

return; and

(c) The condition of the motor vehicle at the time of the

transfer to the manufacturer, distributor, authorized
dealer or retailer.

The responsibility of the manufacturer, distributor,

authorized dealer or retailer under this section shall
cease upon the sale of the affected motor vehicle to the
first purchaser.

Section 11. Penalty. – The manufacturer, distributor,

authorized dealer or retailer adjudged to have violated
the provisions requiring disclosure as mentioned in the
preceding section shall be liable to pay a minimum
amount of One hundred thousand pesos (P100,000.00)
as damages to the aggrieved party without prejudice to
any civil or criminal liability they and/or the responsible
officer may incur under existing laws.

Section 12. Assistance by Other Agencies. – The

DOTC and other agencies, political subdivisions, local
government units, including government-owned and/or
controlled corporations, shall render such assistance as
required by the DTI in order to effectively implement the
provisions of this Act.

Section 13. Implementing Rules and Regulations. –

The DTI shall promulgate the necessary implementing
rules and regulations within, ninety (90) days from the
effectivity of this Act.
 2) give notice to each distributor or retailer of such
II. CONSUMER PROTECTION product.

▪ It is the policy of the State to protect the interests of the ▪ The department shall also direct the manufacturer,
consumer, promote his general welfare and to establish distributor or seller of such product to extend any or all of
standards of conduct for business and industry. the following remedies to the injured person:
1) to bring such product into conformity with the
▪ Objectives requirements of the applicable consumer product
1) Protection against hazards to health and safety; standards or to repair the defect in order to conform with
2) Protection against deceptive, unfair and the same;
unconscionable sales acts and practices; 2) to replace the product with a like or equivalent product
3) Provision of information and education to facilitate which complies with the applicable consumer product
sound choice and the proper exercise of rights by the standards which does not contain the defect;
consumer; 3) to refund the purchase price of the product less a
4) Provision of adequate rights and means of redress; reasonable allowance for use; and
and 4) to pay the consumer reasonable damages as may be
5) Involvement of consumer representatives in the determined by the department
formulation of social and economic policies.
▪ The manufacturer shall avail of the Philippine
II.a. CONSUMER PRODUCT QUALITY AND SAFETY Standard Certification Mark which the concerned
department shall grant after determining the product’s
▪ Duties of the State: compliance with the relevant standard in accordance
1) to develop and provide safety and quality standards with the implementing rules and regulations.
for consumer products, including performance or use-
oriented standards, codes of practice and methods of ▪ Imported Products
tests; 1) Refused admission if it:
2) to assist the consumer in evaluating the quality, a) fails to comply with an applicable consumer
including safety, performance and comparative utility of product quality and safety standard or rule;
consumer products; b) is or has been determined to be injurious, unsafe
3) to protect the public against unreasonable risks of and dangerous;
injury associated with consumer products; c) is substandard; or
4) to undertake research on quality improvement of d) has material defect.
products and investigation into causes and prevention of
product related deaths, illness and injuries; 2) Owner or the consignee of the imported products may
5) to assure the public of the consistency of manifest under bond that none of the above ground for
standardized products. non-admission exists or that measures have been taken
to cure them before they are sold, distributed or offered
▪ Implementing agencies: for sale to the general public.
1) Department of Health – foods, drugs, cosmetics,
devices and substances; 3) Any consumer product, the sale or use of which has
2) Department of Agriculture - products related to been banned or withdrawn in the country of
agriculture; manufacture, shall not be imported into the country.
3) Department of Trade and Industry – other consumer
products 4) Non-admitted imported products may be released
from customs custody under bond for the purpose of
The concerned department shall adopt existing permitting the owner or consignee an opportunity to so
government domestic product quality and safety modify such product.
standards.
In the absence of such standards, the 5) If the product cannot be so modified, or if the owner or
concerned department shall form specialized technical consignee is not proceeding to satisfactorily modify such
committees composed of equal number of product → refused admission, and direct redelivery into
representatives from each of the Government, business customs custody, or seize the product if redelivered.
and consumer sectors to formulate, develop and
purpose consumer product quality and safety standards. 6) Non-admitted imported products must be exported.
Otherwise, products undergo destruction.
▪ In case the department, upon petition by an interested
party or its own initiative and after due notice and ▪ Exported products. — safety and quality provisions
hearing, determines a consumer product to be on imported products shall not apply to any consumer
substandard or materially defective, it shall so notify the product if:
manufacturer, distributor or seller thereof of such finding
and order such manufacturer, distributor or seller to: 1) it can be shown that such product is manufactured,
1) give notice to the public of the defect or sold or held for sale for export from the Philippines, or
failure to comply with the product safety standards; and that such product was imported for export, unless such
consumer product is in fact distributed in commerce for reasonably protect his interest because of his inability to
use in the Philippines; and understand the language of an agreement of similar
factors;
2) such consumer product or the packaging thereof 2) When consumer transaction was entered into, the
bears a stamp or label stating that such consumer price grossly exceeded the price at which similar
product is intended for export and actually exported. products or services were readily obtainable in similar
transaction by like consumers;
II.b. DECEPTIVE, UNFAIR AND UNCONSCIONABLE 3) When consumer transaction was entered into, the
SALES ACTS ANDPRACTICES consumer was unable to receive a substantial benefit
from the subject of the transaction;
II.b.i. Deceptive sales acts or practices 4) When the consumer was entered into, the seller or
▪ Act or practice where the producer, manufacturer, supplier was aware that there was no reasonable
supplier or seller through concealment, false probability or payment of the obligation in full by the
representation or fraudulent manipulation, induces a consumer; and
consumer to enter into a sales or lease transaction of 5) Transaction that the seller or supplier induced the
any consumer product or service. consumer to enter into was excessively one-sided in
favor of the seller or supplier.
▪ Act or practice of a seller or supplier is deceptive when
it represents that: ▪ Unfair or unconscionable sales act or practice by a
1) Consumer product/service has the sponsorship, seller or supplier in connection with a consumer
approval, performance, characteristics, ingredients, transaction violates this Act whether it occurs before,
accessories, uses or benefits it does not have; during or after the consumer transaction.
2) Consumer product/service is of a particular
standard, quality, grad, style, or model when in fact it is II.b.ii.1. Chain distribution plans or pyramid sales
not; schemes
3) Consumer product is new, original or unused, ▪ Sales devices whereby a person, upon condition that
when in fact, it is in a deteriorated, altered, he makes an investment, is granted by the manufacturer
reconditioned, reclaimed or second-hand state; or his representative a right to recruit to profit one or
4) Consumer product/service is available to the more additional persons who will also be granted such
consumer for a reason that is different from the fact; right to recruit upon condition of making similar
5) Consumer product/service has been supplied in investments.
accordance with the previous representation when in
fact it is not; The profits of the person employing such a plan are
6) Consumer product/service can be supplied in a derived primarily from the recruitment of other plans into
quantity greater than the supplier intends; the plan rather than from the sale of consumer products,
7) Service, or repair of a consumer product is services or credit.
needed when in fact it is not;
8) Specific price advantage of a consumer product ▪ Not be employed in the sale of consumer products
exists when in fact it does not;
9) Sales act or practice involves or does not involve II.b.ii.2. Home solicitation sales
a warranty, a disclaimer of warranties, particular ▪ Allowed if with permit from the DTI
warranty terms or other rights, remedies or obligations if
the indication is false; and ▪Conducted only between 9AM and 7PM of each
10) Seller or supplier has a sponsorship, approval, or working day. XPN: other times, if agreed upon.
affiliation he does not have.
▪Conducted only by a person who has the proper
▪ Deceptive act or practice by seller or supplier in identification and authority from his principal to make
connection with a consumer transaction violates this Act such solicitations.
whether it occurs before, during or after the transaction.
II.b.ii. Unfair or unconscionable sales acts or practices ▪HSS shall not represent that: (a) the buyer has been
specially selected; (b) a survey, test or research is being
▪ Act or practice where the producer, manufacturer, conducted; or (c) the seller is making a special offer to a
distributor, supplier or seller, by taking advantage of the few persons only for a limited period of time.
consumer’s physical or mental infirmity, ignorance,
illiteracy, lack of time or the general conditions of the II.b.ii.3. Referrals sales
environment or surroundings, induces the consumer to ▪ Takes places when an existing consumer provides the
enter into a sales or lease transaction grossly inimical to name and contact information of a prospect to his sales
the interests of the consumer or grossly one-sided in representatives.
favor of the producer, manufacturer, distributor, supplier
or seller. ▪ GR: Not be used in the sale of consumer products.

▪ Circumstances to be considered: - XPN: Seller executes in favor of the buyer a written

1) Producer, manufacturer, distributor, supplier or undertaking that will grant a specified compensation or
seller took advantage of the inability of the consumer to
other benefit to said buyer in return for each and every ▪ Designation of warranties
transaction consummated by said seller with the persons 1) Full warranty – if written warranty meets the
referred by said buyer or for subsequent sales that said minimum requirements
buyers has helped the seller enter into. 2) Limited warranty – if written does not meet such
minimum
II.b.ii. Penalties requirements
1) Fine – 5k to 10k
2) Imprisonment – not more than 1yr ▪ To meet the minimum standards for warranty,
3) Both, at the discretion of the court warrantor shall:
1) Remedy such consumer product within a
II.c. PRODUCT AND SERVICE WARRANTY reasonable time and without charge in case of a defect,
malfunction or failure to conform to such written
II.c.i. Consumer products with warranty warranty;
▪ Any seller or manufacturer who gives an express 2) Permit the consumer to elect whether to ask for a
warranty shall: refund or replacement without charge of such product or
part, as the case may be, where after reasonable
1) Set forth the terms of warranty in clear and readily number of attempts to remedy, the product continues to
understandable language and clearly identify himself as have the defect or to malfunction.
the warrantor;
2) Identify the party to whom the warranty is extended; Warrantor will not be required to perform the above
3) State the products or parts covered; duties if he can show that the defect, malfunction or
4) State what the warrantor will do in the event of a failure to conform to a written warranty was caused by
defect, malfunction of failure to conform to the written damage due to unreasonable use thereof.
warranty and at whose expense
5) State what the consumer must do to avail of the rights ▪ Enforceability of the warranties:
which accrue to the warranty; and 1) Express – as to stipulation of the parties
6) Stipulate the period within which, after notice of 2) Express with implied - both will be of equal
defect, malfunction or failure to conform to the warranty, duration.
the warrantor will perform any obligation under the 3) Implied - not less than 60 days nor more than 1yr
warranty.
▪ Breach of warranties:
▪ All written warranties or guarantees issued by a 1) Express
manufacturer, producer, or importer shall be operative a) Repair – within 30 days, may be extended
from the moment of sale. b) Refund of purchase price
2) Implied
▪ Sales report – all sales made by distributors of a) Retain the goods + damages
products shall be reported to the manufacturer, producer b) Reject the goods + cancel the contract +
or importer of the product sold within 30 days from date recover purchase price + damages.
of purchase, unless otherwise agreed upon.
o It shall contain the date of purchase, model of the II.c.ii. Warranties in supply of services
product bought, its serial number, name and address of
the buyer. ▪ There is an implied warranty that the service will be
o It is equivalent to a warranty registration with the rendered with due care and skill and that any material
manufacturer, producer or importer. Such registration is supplied in connection with such services will be
sufficient to hold the manufacturer, producer or importer reasonably fit for the purpose for which it is supplied.
liable under its warranty.
▪ When consumer, expressly or by implication, makes
1) Manufacturer, producer or importer known to the seller the particular purpose for which the
- primarily liable services are required, there is an implied warranty that
the services supplied under the contract and any
2) Distributor material supplied in connection therewith will be
– primarily liable, if no sales report made reasonably fit for that purpose or are of such a nature or
-cannot ask for reimbursement for costs incurred in quality that they might reasonably be expected to
honoring the warranty achieve that result, unless the circumstances show that
the consumer does not rely or that it is unreasonable for
3) Retailer him to rely, on the seller’s skill or judgment.
- subsidiarily liable, if both distributor and MPI failed to
honor the warranty ▪ This Act on warranty shall not apply to professional
- can ask reimbursement from distributor or MPI services of CPAs, architects, engineers, lawyers,
▪ Warranty rights can be enforced by presentment of a veterinarians, optometrists, pharmacists, nurses and
claim. other professional engaged in their respective
1) Warranty card or the official receipt or sales professional endeavors.
invoice
2) Product to be serviced or returned
▪ Service firms shall guarantee workmanship and
replacement of spare parts for a period not less than 90 II.d.ii. Labeling requirements for consumer products
days which shall be indicated in the pertinent invoices.
▪ Minimum labeling requirements
II.c.iii. Prohibited acts 1) Its correct and registered trade name or brand
name;
1) Refusal without any valid legal cause by the local 2) Its duly registered trademark;
manufacturer or any person obligated under the 3) Its duly registered business name;
warranty or guarantee to honor a warranty or guarantee 4) The address of the manufacturer, importer,
issued; repacker of the consumer product in the Phil;
5) Its general make or active ingredients;
2) Unreasonable delay by the local manufacturer or any 6) The net quality of contents, in terms of weight,
person obligated under the warranty or guarantee in measure or numerical count rounded of to at least the
honoring the warranty; nearest tenths in the metric system;
7) Country of manufacturer; and
3) Removal by any person of a product’s warranty card 8) If a consumer product is manufactured, refilled or
for the purpose of evading said warranty obligation; repacked under license from a principal, the label shall
so state the fact.
4) Any false representation in an advertisement as to the
existence of a warranty or guarantee. ▪ Any word, statement or other information required by or
under authority:
II.c.iv. Penalties 1) Whether it is flammable or inflammable;
2) Directions for use, if necessary;
1) Any person who shall violate the provisions of Art. 67 3) Warning of toxicity;
(Conditions and Warranties governed by CC) 4) Wattage, voltage or amperes; or
a) Fine – P500 to P5,000 5) Process of manufacture used if necessary.
b) Imprisonment – 1 to 2yrs
c) Both Shall appear on the label or labeling with such
conspicuousness as compared with other words,
2) Prohibited acts other than Art. 67 statements, designs or devices therein, and in such
a) Fine – P1,000 to P50,000 terms as to render it likely to be read and understood by
b) Imprisonment – 1 to 5yrs the ordinary individual under customary conditions of
c) Both purchase or use.

▪ Any imposition of any of the penalties is without It shall form an integral part of the label without danger
prejudice to any liability incurred under the warranty or of being erased or detached under ordinary handling of
guarantee. the product.

II.d. LABELLING AND PACKAGING ▪ Label may contain the Philippine Product Standard
Mark if it is certified to have passed the consumer
▪The State shall enforce compulsory labeling, product standard prescribed by the concerned
and fair packaging to enable the consumer to obtain department.
accurate information as to the nature, quality and
quantity of the contents of consumer products and to ▪ A package shall be deemed to be nonfunctionally
facilitate his comparison of the value of such products. slack-filled if it is filled to substantially less than its
capacity for reasons other than: (a) protection of the
II.d.i. Prohibited acts contents of such package; (b) the requirements of
machines used for enclosing the contents in such
▪ It shall be unlawful for any person, either as principal or package; or (c) inherent characteristics of package
agent, engaged in labeling or packaging of any materials or construction being used.
consumer product, to display or distribute or to cause to
be displayed or distributed in commerce any consumer II.d.iii. Packaging of consumer products for the
product whose package or label does not conform to the protection of children
provisions hereof.
▪ Standards for the special packaging of any consumer
▪ Prohibition shall not apply to persons engaged in the product may be established if it finds that:
business of wholesale or retail distributors of consumer
products. 1) Degree or nature of the hazard to children in the
availability of such product, by reason of its packaging, is
XPNs: When they (a) are engaged in the packaging or such that special packaging is required to protect
labeling of such products; (b) prescribe or specify by any children from serious personal injury or serious illness
means the manner in which such products are packaged resulting from handling and use of such product;
or labeled; or (c) having knowledge, refuse to disclose
the source of the mislabeled or mispackaged products.
2) Special packaging to be required by such standard is II.e.i.1. Manner of placing price tags
technically feasible, practicable and appropriate for such
product. ▪ Smaller consumer products – a price list placed at the
nearest point where the products are displayed may
The concerned department shall consider the: suffice.
a) reasonableness of such standard;
b) available scientific, medical and engineering data ▪ Price tags, labels or markings must be written clearly,
concerning special packaging and concerning indicating the price of the consumer product per unit in
accidental, ingestions, illnesses and injuries caused by pesos and centavos.
consumer product;
c) manufacturing practices of industries affected by II.e.i.2. Regulations for price tag placements
this Act; and
d) nature and use of consumer products. ▪ The concerned department shall prescribe rules and
regulations for the visible placement of price tags for
II.d.iv. Additional labeling requirements specific consumer products and services. There shall be
no erasures or alterations of any sort of price tags, labels
1) For food or markings.
a) Expiry or expiration date, where applicable;
b) Whether the consumer product is semi-processed, II.e.i.3. Penalties
fully processed, ready-to-cook, ready-to-eat, prepared
food or just plain mixture; 1) Fine – P200 to P5,000
c) Nutritive value, if any; 2) Imprisonment – 1mo to 6mos
d) Whether the ingredients use are natural or 3) Both, upon discretion of the court
synthetic, as the case may be;
e) Such other labeling requirements as the ▪ Second conviction carries the penalty of revocation of
concerned department may deem necessary and business permit and
reasonable. license.

2) For cosmetics LEMON LAW

a) Expiry or expiration date;
b) Whether or not it may be an irritant; REPUBLIC ACT NO. 10642
c) Precautions or contra-indications; and AN ACT STRENGTHENING CONSUMER
d) Such other labeling requirements as the PROTECTION IN THE PURCHASE OF BRAND NEW
concerned department may deem necessary and MOTOR VEHICLES
reasonable.
Be it enacted by the Senate and House of
3) For drugs - Generics Act shall apply Representatives of the Philippines in Congress
assembled:
4) For cigarettes
a) All cigarettes for sale or distribution within the Section 1. Short Title. – This Act shall be known as the
country shall be contained in a package which shall bear "Philippine Lemon Law".
the following statement or its equivalent in Filipino:
“Warning” Cigarette Smoking is Dangerous to Your Section 2. Declaration of Policy. – It is hereby
Health”. declared the policy of the State to promote full protection
b) Such statement shall be located in conspicuous to the rights of consumers in the sale of motor vehicles
place on every cigarette package and shall appear in against business and trade practices which are
conspicuous and legible type in contrast by typography, deceptive, unfair or otherwise inimical to consumers and
layout or color with other printed matter on the package. the public interest.
c) Any advertisement of cigarette shall contain the
name warning as indicated in the label. The State recognizes that a motor vehicle is a major
consumer purchase or investment. Hence, the rights of
II.e. CONSUMER RIGHTS consumers should be clearly defined, including the
means for redress for violations thereof.
II.e.i. Price Tag Act
Section 3. Definition of Terms. – As used in this Act:
▪ It shall be unlawful to offer any consumer product for
retail sale to the public without an appropriate price tag, Section 4. Coverage. – This Act shall cover brand new
label, or marking publicly displayed to indicate the price motor vehicles purchased in the Philippines reported by
of each article and said products shall not be sold at a a consumer to be in nonconformity with the vehicle’s
price higher than that stated therein and without manufacturer or distributor’s standards or specifications
discrimination to all buyers. within twelve (12) months from the date of .original
delivery to the consumer, or up to twenty thousand
(20,000) kilometers of operation after such delivery,
whichever comes first. The following causes of provided for under this Act: Provided, however, That if
nonconformity shall be excluded: the vehicle is not returned for repair, based on the same
complaint, within thirty (30) calendar days from the date
(a) Noncompliance by the consumer of the obligations of notice of release of the motor vehicle to the consumer
under the warranty; following this repair attempt within the Lemon Law rights
period, the repair is deemed successful: Provided,
(b) Modifications not authorized by the manufacturer, finally, That, in the event that the nonconformity issue
distributor, authorized dealer or retailer; still exists or persists after the thirty (30)-day period but
still within the Lemon Law rights period, the consumer
(c) Abuse or neglect of the brand new motor vehicle; and may be allowed to avail of the same remedies under
Sections 5 and 6 hereof.
(d) Damage to the vehicle due to accident or force
majeure. To compensate for the non-usage of the vehicle while
under repair and during the period of availment of the
Section 5. Repair Attempts. – At any time within the Lemon Law rights, the consumer shall be provided a
Lemon Law rights period, and after at least four (4) reasonable daily transportation allowance, an amount
separate repair attempts by the same manufacturer, which covers the transportation of the consumer from his
distributor, authorized dealer or retailer for the same or her residence to his or her regular workplace or
complaint, and the nonconformity issue remains destination and vice versa, equivalent to air-conditioned
unresolved, the consumer may invoke his or her rights taxi fare, as evidenced by official receipt, or in such
under this Act. amount to be agreed upon by the parties, or a service
vehicle at the option of the manufacturer, distributor,
The repair may include replacement of parts authorized dealer or retailer. Any disagreement on this
components, or assemblies. matter shall be resolved by the DTI.

Section 6. Notice of Availment of Lemon Law Rights. Nothing herein shall be construed to limit or impair the
– Before availing of any remedy under this Act and rights and remedies of a consumer under any other law.
subject to compliance with the provisions of Section 5
hereof, the consumer shall, in writing, notify the Section 8. Remedies for Dispute Resolution. – The
manufacturer, distributor, authorized dealer or retailer of DTI shall exercise exclusive and original jurisdiction over
the unresolved complaint, and the consumer’s intention disputes arising from the provisions of this Act. All
to invoke his or her rights under this Act within the disputes arising from the provisions of this Act shall be
Lemon Law rights period. settled by the DTI in accordance with the following
dispute resolution mechanisms:
The warranty booklet issued by the manufacturer,
distributor, authorized dealer or retailer shall clearly state (a) Mediation
the manner and form of such notice to constitute a valid
and legal notice to the manufacturer, distributor, (1) The principles of negotiation, conciliation and
authorized dealer or retailer. It shall also clearly state the mediation towards amicable settlement between the
responsibility of the consumer under this section. manufacturer, distributor, authorized dealer or retailer
and the consumer shall be strictly observed;
Section 7. Availment of Lemon Law Rights. –
Subsequent to filing the notice of availment referred to in (2) In the course of its dispute resolution efforts, the DTI
the preceding section, the consumer shall bring the shall endeavor to independently establish the validity of
vehicle to the manufacturer, distributor, authorized dealer the consumer’s outstanding complaint. The DTI shall
or retailer from where the vehicle was purchased for a likewise retain the services of other government
final attempt to address the complaint of the consumer to agencies or qualified independent private entities in the
his or her satisfaction. ascertainment of the validity of the consumer’s
complaint. Any cost incurred in establishing the validity
It shall be the duty of the manufacturer, distributor, of the consumer’s complaint shall be bornejointly by the
authorized dealer or retailer, upon receipt of the motor consumer and the manufacturer, distributor, authorized
vehicle and the notice of nonconformity required under dealer or retailer;
Section 6 hereof, to attend to the complaints of the
consumer including, as may be necessary, making the (3) The complaint shall be deemed valid if it is
repairs and undertaking such actions to make the independently established that the motor vehicle does
vehicle conform to the standards or specifications of the not conform to the standards or specifications set by the
manufacturer, distributor, authorized dealer or retailer for manufacturer, distributor, authorized dealer or retailer;
such vehicle.
(4) Upon failure of the negotiation or mediation between
In case the nonconformity issue remains unresolved the manufacturer, distributor, authorized, dealer or
despite the manufacturer, distributor, authorized dealer retailer and the consumer, the parties shall execute a
or retailer’s efforts to repair the vehicle, pursuant to the certificate attesting to such failure; and
consumer’s availment of his or her Lemon Law rights,
the consumer may file a complaint before the DTI as
(5) At any time during the dispute resolution period, the
manufacturer, distributor, authorized dealer or retailer (ii) The decision/order is in excess of
and the consumer shall be encouraged to settle jurisdiction or authority of the Adjudication Officer; and
amicably. All disputes that have been submitted for
mediation shall be settled not later than ten (10) working (iii) The decision/order is not supported by the
days from the date of filing of the complaint with the DTI. evidence or there is serious error in the findings of facts.

(b) Arbitration The Secretary of the DTI shall decide on the appeal
within thirty (30) days from receipt thereof. A party
In the event there is a failure to settle the complaint seeking further appeal from the decision of the Secretary
during the mediation proceedings, both parties may of the DTI may file a case for certiorari to the Court of
voluntarily decide to undertake arbitration proceedings. Appeals under Section 4, Rule 65 of the Revised Rules
of Court.
(c) Adjudication
Section 9. Determination of Reasonable Allowance
(1) In the event that both parties do not undertake for Use. – For purposes of this Act, "reasonable
arbitration proceedings, at least one of the parties may allowance for use" shall mean twenty percent (20%) per
commence adjudication proceedings, administered by annum deduction from the purchase price, or the product
the DTI. The DTI shall rely on the qualified independent of the distance traveled in kilometers and the purchase
findings as to conformity to standards and specifications price divided by one hundred thousand (100,000)
established herein. In no case shall adjudication kilometers, whichever is lower.
proceedings exceed twenty (20) working days;
Section 10. Disclosure on Resale. – Should the
(2) In case a finding of nonconformity is arrived at, the returned motor vehicle be made available for resale, the
DTI shall rule in favor of the consumer and direct the manufacturer, distributor, authorized dealer or retailer
manufacturer, distributor, authorized dealer or retailer to shall, prior to sale or transfer, disclose in writing to the
grant either of the following remedies to the consumer: next purchaser of the same vehicle the following
information:
(i) Replace the motor vehicle with a similar or
comparable motor vehicle in terms of specifications and (a) The motor vehicle was returned to the
values, subject to availability; or manufacturer, distributor, authorized dealer or retailer;

(ii) Accept the return of the motor vehicle and (b) The nature of the nonconformity which
pay the consumer the purchase price plus the collateral caused the return; and
charges.
(c) The condition of the motor vehicle at the
In case the consumer decides to purchase another time of the transfer to the manufacturer, distributor,
vehicle with a higher value and specifications from the authorized dealer or retailer.
same manufacturer, distributor, authorized dealer or
retailer, the consumer shall pay the difference in cost. The responsibility of the manufacturer, distributor,
authorized dealer or retailer under this section shall
In both cases of replacement and repurchase, the cease upon the sale of the affected motor vehicle to the
reasonable allowance for use, as defined in this Act, first purchaser.
shall be deducted in determining the value of the
nonconforming motor vehicle; and Section 11. Penalty. – The manufacturer, distributor,
authorized dealer or retailer adjudged to have violated
(3) In case a nonconformity of the motor vehicle is not the provisions requiring disclosure as mentioned in the
found by the DTI, it shall rule in favor of the preceding section shall be liable to pay a minimum
manufacturer, distributor, .authorized dealer or retailer, amount of One hundred thousand pesos (P100,000.00)
and direct the consumer to reimburse the manufacturer, as damages to the aggrieved party without prejudice to
distributor, authorized dealer or retailer the costs any civil or criminal liability they and/or the responsible
incurred by the latter in validating the consumer’s officer may incur under existing laws.
complaints.
Section 12. Assistance by Other Agencies. – The
An appeal may be taken from a final judgment or order DOTC and other agencies, political subdivisions, local
of the Adjudication Officer which completely disposes of government units, including government-owned and/or
the case within fifteen (15) days from receipt controlled corporations, shall render such assistance as
thereof.1âwphi1 The appeal shall be taken by filing a required by the DTI in order to effectively implement the
Memorandum of Appeal with the Secretary of the DTI, provisions of this Act.
with Notice of Appeal to the Adjudication Officer, and
with a copy duly furnished the adverse party or parties Section 13. Implementing Rules and Regulations. –
on any of the following grounds: The DTI shall promulgate the necessary implementing
rules and regulations within, ninety (90) days from the
(i) Grave abuse of discretion; effectivity of this Act.
3. Advances for Payroll – for payment of salaries, wages
and other personnel benefits; and
4. Advances to Special Disbursing Officer (SDO) – for
special purpose/time-bound undertakings.

j. Intra-agency and inter-agency fund transfers. Cash

g. Performance bond/security deposits. Receipts of received from central office/regional office/operating
performance bond posted by contractor or supplier to units of an entity and from another entity for the purpose
guaranty full and faithful performance of their contract. It of implementing specific projects.
may be in the form of cash or certified checks.

h. Refund of overpayment of expenses. Receipts of

refunds from officers, employees and suppliers/creditors
resulting from overpayment of expenses.

i. Collections made on behalf of another entity or non-

government/private organizations. Receipts of income,
receivables or trust funds for the account of other NGAs,
LGUs, GOCCs or non-government/private organizations.
These collections are later remitted to the government
agencies or non-government/private organizations
concerned.
1. NGAs (other than University of the Philippines-Legal
Research Fund (UP-LRF)) Books
Sec. 39. Reporting of Collections and Deposits.
Receipts and deposits shall be reported as follows:
a. At the close of the business day, the Collecting
Officers shall prepare the Report of Collections and
Deposits (RCD) (Appendix 26) for submission to
Accounting Office/Unit. The report lists all the ORs
issued in numerical sequence including cancelled ones.

b. The RCD shall be supported by documentary

evidence such as duplicate copies of ORs and validated
deposit slips.

c. The Collecting government entity issuing electronic

Official Receipt (eOR) should generate and submit daily
to the Auditor a copy of the RCD. In case the collection
system is not integrated with the accounting system, the
Accounting Division/Unit shall recognize the collections
and deposits based on the generated reports duly
certified by the Collecting Officer/Cashier/Head of
Cash/Treasury Unit.

d. Field Offices (FOs)/Operating Units (OUs) without

complete set of books shall record their collections of
income chronologically in the Cash Receipts
Register(CRReg) (Appendix 27). The certified copy of
the CRReg together with the required supporting
documents, duplicate copies of ORs and Deposit Slip
(DSs) shall be submitted within five (5) days after the
end of each month to the concerned mother unit
(central/regional/division office) by the FOs (a unit under
the central/regional/ division office) for review and
recording of the transactions in the CRJ by the Chief
Accountant.

Sec. 42. Submission of the Quarterly Report of

Revenue and Other Receipts. The Chief Accountant
shall prepare the Quarterly Report of Revenue and
Other Receipts (QRROR) (Appendix 24) and submit the
report to the GAS, COA, the DBM and the BTr within 30
days after the end of each quarter. A separate report
shall be prepared and submitted for income of the GF
and for income and receipts for Special Account and
Trust Fund.