ELECTRONIC COMMERCE ACT (R.A.

8792)
Service providers must:
ELECTRONIC COMMERCE ACT  Not change or add to the document unless
they are allowed to.
An act providing for the recognition and use of
 Keep the document as requested or as
electronic commercial and noncommercial
needed to do their job.
transactions, penalties for unlawful use thereof, and
(7) Electronic Data Message – Information that is
other purposes.
created, sent, received, or stored using electronic,
 Electronic messages, data and signatures can now
optical, or similar methods.
be used as evidence
(8) Electronic Signature – Any unique mark, trait, or
OBJECTIVES sound in electronic form that shows who the
person is and is connected to an electronic
(1) To support digital transactions — It promotes
document or data message. It can also be a
using electronic, optical, or similar technology for
method used by a person to approve or
local and international business dealings,
authenticate the document or message.
agreements, and data storage.
(9) Electronic Key – A secret code used to protect
(2) To recognize electronic documents — It ensures
sensitive information that travels through public
that electronic messages and documents are
networks. It can only be unlocked using a
accepted as authentic and reliable.
matching key.
(3) To encourage digital use — It aims to make
(10)Electronic Document – Information or symbols
electronic transactions common in both
(like data, figures, or text) stored or shared
government and public activities.
electronically, which can:
SCOPE  Show legal rights,
 Cancel obligations, or
The Act applies to any electronic document used in
 Prove a fact.
both commercial and non-commercial activities,
whether local or international, including contracts,
LEGAL RECOGNITION OF ELECTRONIC DATA
agreements, and data storage.
MESSAGES AND ELECTRONIC DOCUMENTS
DEFINITION OF TERMS
(1) Electronic Data Messages: These are legally valid
(1) Computer – A device (alone or connected with
and enforceable even if they exist only in digital
others) that can process, store, send, and retrieve
form or are referenced in other digital messages.
information like text, images, sound, or video.
(2) Electronic Documents
(2) Information and Communications System – A
Treated as valid and enforceable like written
system (like a computer setup) that creates,
documents if:
sends, receives, stores, or processes electronic
 They are complete and unchanged, except
documents, including related procedures.
for normal changes or authorized
(3) Originator – The person who creates or sends the
endorsements.
electronic document. Not the one who just passes
 They are reliable and can be used for future
it along.
reference.
(4) Addressee – The person who is meant to receive
They satisfy laws requiring:
the electronic document. Also, not someone who
 Written form if the document is trustworthy
just forwards it.
and unaltered.
(5) Intermediary – A person or entity that sends,
 Original form if the document's integrity can
receives, or stores the electronic document on
be assured and it can be displayed when
behalf of someone else.
needed.
(6) Service Provider – Someone who:
Note: This does not override existing laws that
 Offers online services or network access,
require special document formalities (like
helping users transmit their electronic
notarized deeds, etc.).
documents.
 Provides technical support so that the
(3) Electronic Signatures
documents can be stored and accessed by
Treated as equal to handwritten signatures if:
others.
 ELECTRONIC COMMERCE ACT (R.A. 8792)
 A secure method is used to identify the
INTEGRITY OF THE INFORMATION AND
signer and show they had access to the
COMMUNICATION SYSTEM
document.
 The method is reliable and appropriate for The system that stores electronic documents is
the document’s purpose. considered reliable if:
 The signer must have used the signature to  It worked properly and didn’t compromise the
proceed with the transaction. document’s integrity. There’s no good reason to
 The other party can verify the signature and doubt the system’s reliability.
choose to proceed.  It was stored or recorded by the opposing party in
Presumption in Legal Proceedings the case.
 Electronic signatures are presumed:  It was stored or recorded during regular business
 To be that of the person whose name is activities by someone not involved in the case and
on it. who was not controlled by the party using the
 To be signed with intent to approve the document.
document. Example: A shipping company regularly records
 Unless: There's knowledge of defects or delivery logs in their system. One of these logs is
it's unreasonable to rely on the used as evidence in a court case between two
signature. customers. The shipping company is not part of
the case and is not under the control of either
ORIGINAL DOCUMENTS REQUIREMENT customer. Since the record was made as part of
Electronic documents satisfy the “original form” normal business operations, it helps prove the
requirement if: integrity of the document.
 Integrity from the time it was first finalized is
proven. ADMISSIBILITY AND EVIDENTIAL WEIGHT
 The content is displayable to the person who  Electronic documents cannot be rejected just
needs to see it. because they are digital or not in the standard
Integrity is assessed based on: written form.
 Whether the info has been complete and  They are considered best evidence if they meet
unaltered, except for routine changes. legal requirements.
 Whether it's reliable for its intended purpose.  When evaluating, courts will consider:
o How reliably the document was created,
AUTHENTICATION
stored, and sent.
Until rules are set by the Supreme Court, electronic o How reliably the sender was identified.
documents and signatures can be authenticated by: o Other relevant factors.
 Proving that a name, number, or symbol identifies
the person and is logically attached to the RETENTION OF DOCUMENTS
document. Electronic documents can be legally kept instead of
 Showing that security procedures (e.g., codes, original paper documents if:
encryptions, etc.) were used to: (1) They are accessible for future use.
o Verify the sender. (2) They are kept in the original format or one that
o Detect any errors or alterations. accurately reflects the original.
The Supreme Court may also allow: (3) The sender, receiver, and time can be identified.
 Electronic notarization and (4) A third party may store them, as long as the
 Certificates of authentication for printed above conditions are met.
versions.
by electronic notaries, service providers and other Proof of Affidavit: An affidavit (written sworn
duly recognized or appointed certification authorities statement) can prove authenticity, unless the other
party requests cross-examination.
Burden of Proof: Whoever wants to use an electronic
document in court must prove that it is authentic.
 ELECTRONIC COMMERCE ACT (R.A. 8792)
CROSS-EXAMINATION RIGHTS o An automated system set up by or on
behalf of the originator
(1) The person who wrote the affidavit can be
questioned in court by the opposing side.
 The addressee can assume the EDM/ED came
(2) Anyone claiming a document was stored in the
from the originator if:
regular course of business can also be cross-
a. They used a verification method previously
examined.
agreed upon, or
FORMATION AND VALIDITY OF ELECTRONIC b. It came from someone who had access to the
CONTRACTS originator’s methods due to their relationship

 Contracts can be formed and proven using  This assumption does not apply if:
electronic messages/documents (EDMs/EDs).  The addressee received notice that the
 They are valid and enforceable even if they’re not message was not from the originator and had
in paper form. time to act
 This applies unless both parties agree otherwise.  The addressee knew or should have known,
 Unless parties agree otherwise: through reasonable care or agreed procedure,
o Offer, that it wasn’t genuine
o Acceptance, and  The message was altered or had errors during
o Other legal elements of contracts transmission
— can all be done using electronic data messages
DUPLICATES
or documents.
 A contract cannot be rejected just because it's Each EDM/ED is treated as a separate message,
electronic. unless:
 It duplicates another, and
ELECTRONIC TRANSACTIONS AMONG  The addressee knew or should have known it
BANKS OR LINKED NETWORKS was a duplicate
 Considered completed (consummated) when: ERRORS IN EDM OR ED
 Cash is dispensed, or
The addressee may assume the EDM/ED is exactly
 An account is debited and another is credited,
what the originator intended, unless:
 Whether started by the depositor or an
a. There was a transmission error, or
authorized collecting party.
b. The EDM/ED was sent to the wrong information
 Obligations from such transactions are:
system
 Absolute,
 Not subject to “preference of credits” (e.g.,
ACKNOWLEDGEMENT OF RECEIPT
not ranked lower in claims).
General Rule: No acknowledgment is needed unless:
RECOGNITION OF PARTIES Exceptions:
 The parties agreed to require it
A declaration (e.g., an agreement or statement)
 The originator requested it in the EDM/ED
between the sender (originator) and receiver
How acknowledgment may be made:
(addressee) of an EDM or ED cannot be denied legal
 If a method was agreed, follow it
effect or enforceability just because it was in
 If not agreed:
electronic form.
o Any response from the addressee
ATTRIBUTION OF EDM/ED o Any action that shows receipt
When the originator can treat the EDM/ED as not
 An EDM/ED is considered as coming from the
received:
originator if:
 If receipt was made a condition but never
 It was sent by the originator
acknowledge receipt (e.g., the contract is only
 It was sent by:
valid upon acknowledgment of receipt)
o Someone authorized by the originator, or
 ELECTRONIC COMMERCE ACT (R.A. 8792)
 If no condition was stated, but the originator
sent a notice of non-receipt, gave a reasonable
deadline, and still received no acknowledgment

TIME OF DISPATCH ELECTRONIC COMMERCE IN CARRIAGE OF

GODOS
 Dispatch occurs when the EDM/ED enters an
information system that is:
ACTIONS RELATED TO CONTRACTS OF
 Outside the control of the originator or the person
CARRIAGE OF GOODS
sending it for them
 Unless otherwise agreed by the parties
This applies to any action connected with or in pursuit
of a contract of carriage of goods, including but not
TIME OF RECEIPT limited to:
a. Furnishing transport-related information:
Unless agreed otherwise, EDM/ED is considered (i) Providing marks, numbers, quantity, or weight
received as follows: of goods
a. When it enters a designated system, if one exists (ii) Declaring the nature or value of goods
b. When the addressee retrieves it, if: (iii) Issuing a receipt for goods
 Both parties are in the same system, or (iv) Confirming that goods have been loaded
 It enters a non-designated system b. Providing notifications or instructions:
c. When it enters any system of the addressee, if no (i) Notifying someone of the terms and conditions
system was designated of the contract
NOTE: These rules apply regardless of the physical (ii) Giving instructions to a carrier
location of the system c. Delivery and loss/damage communications:
PLACE OF DISPATCH AND RECEIPT (i) Claiming delivery of goods
(ii) Authorizing release of goods
 Unless agreed otherwise: (iii) Giving notice of loss or damage to goods
 EDM/ED is dispatched from the originator’s d. Other statements or notices regarding
place of business performance of the contract
 EDM/ED is received at the addressee’s place e. Undertaking to deliver goods to a specific person
of business or an authorized person
 This rule still applies even if portable devices (like f. Transferring or negotiating rights in goods:
laptops) are used Granting, acquiring, renouncing, surrendering,
 This rule is also used for determining the tax transferring, or negotiating rights in goods
location (tax situs) g. Transferring rights and obligations under the
 If a party has multiple business locations: contract
 Use the location most connected to the
transaction, or VALIDITY OF ELECTRONIC TRANSPORT
 If none, use the main office DOCUMENTS
 If a party has no business place, use the person’s
habitual residence (1) Electronic substitutes for paper requirements:
 For companies, use the place where it is  If any law requires actions related to carriage
incorporated or legally established of goods to be in writing or done via paper
CHOICE OF SECURITY METHODS documents, this requirement is also satisfied
by using electronic data messages or
As long as laws and government regulations are electronic documents.
followed, the parties are free to:  This applies whether the legal requirement is
 Choose the type and level of security they want mandatory or whether consequences exist for
for EDM/ED non-compliance.
 Use any technological method that suits their (2) Granting rights or obligations using electronic
needs documents:
 ELECTRONIC COMMERCE ACT (R.A. 8792)
 If a right or obligation must be transferred via  Conduct transactions and perform government
paper document, this can also be done using functions via electronic data
electronic data messages or documents— messages/documents
provided a reliable method is used to make
such EDM/ED unique.
 The reliability is judged based on the purpose
of the transfer and the specific context,
including any agreement.
GOVERNMENT RESPONSIBILITIES FOR
(3) Switching between electronic and paper
IMPLEMENTATION
documents:
 If electronic methods are used for actions Agencies are authorized to adopt and publish rules
under items (f) and (g) above (i.e., rights and guidelines (after public hearing) that define:
transfer), then no hard-copy paper document (1) Manner and format for filing, creating, retaining,
for that same action is valid unless: or issuing EDM/ED
o The use of electronic documents has been (2) Signature requirements, including the type of
terminated, and electronic signature
o The paper document clearly states that (3) How to affix electronic signatures and the format
termination of EDM/ED
NOTE: You can't use both electronic and (4) Control measures to ensure integrity, security,
paper documents for the same legal action at and confidentiality of EDM/ED and payment
the same time—only one method should records
apply. (5) Other required attributes of electronic documents
 This switch does not affect the rights or (6) Scope of use: full or limited use of electronic
obligations of the parties involved. documents for government compliance
(4) Mandatory legal rules still apply: If a rule of law Note: The Act does not mandate any department to
must apply to paper-based contracts of carriage, it adopt electronic systems until the proper rules are
also applies to contracts using electronic officially adopted, published, and in effect.
documents, even if they're not on paper.
OBLIGATIONS UNDER THE E-COMMERCE ACT
ELECTRONIC TRANSACTIONS IN
GOVERNMENT EXTENT OF LIABILITY OF A SERVICE
PROVIDER
GOVERNMENT USE OF ELECTRONIC
DOCUMENTS AND SIGNATURES General Rule:
Within 2 years from the effectivity of the Act, all  No person or party shall be subject to civil or
government agencies and GOCCs that: criminal liability in respect of an electronic data
 Require or accept filing of documents message or electronic document for merely acting
 Require document creation, retention, or as a service provider.
submission  This includes making, publishing, disseminating, or
 Issue permits, licenses, or certificates distributing material or statements that may
 Handle payment or settlement of fees or infringe rights unless:
obligations Conditions that Exempt Liability:
—shall:  The service provider does not have actual
 Accept the creation, filing, and retention of knowledge that the material is unlawful or
documents in electronic form infringing.
 Issue permits, licenses, or approvals using  The service provider does not knowingly receive a
electronic data messages/documents financial benefit from such unlawful or infringing
 Receive payments and issue receipts through activity.
electronic systems  The service provider does not directly commit any
infringement or benefit financially from it.
Exceptions to the Exemption:
 ELECTRONIC COMMERCE ACT (R.A. 8792)
Liability may still arise under: Fine: Minimum ₱100,000 to maximum of damage
 The obligations and liabilities of the parties under incurred
the electronic data message or electronic Imprisonment: 6 months to 3 years
document. Additional: Maximum fine equals the damage
 Any obligation founded on contract. incurred.
 Regulations under licensing or other legal (3) Violations of the Consumer Act (RA No. 7394)
regimes. Penalty: Fines and imprisonment as provided in
 Any obligation imposed under written law the relevant consumer laws.
 Court-ordered injunctions or relief requiring the
service provider to remove, block, or deny access (4) Other Violations of the E-Commerce Act
to infringing material. Fine: Up to ₱1,000,000
Imprisonment: Up to 6 years
LAWFUL ACCESS
Access to electronic files or signatures must be: STATUTORY INTERPRETATION
 Authorized and The Act should be interpreted considering:
 Based on a legal right or court order. (1) Its international origin
Electronic keys for identity or integrity must not be (2) The need for uniform application and good faith
disclosed without consent unless legally required. in international trade
(3) Generally accepted principles of international law
OBLIGATION OF CONFIDENTIALITY
and electronic commerce conventions
Any person who accesses:
RECIPROCITY CLAUSE
 An electronic key
 Electronic messages/documents Only foreign individuals whose country grants the
 Registers, information, or other materials same rights and privileges to Filipino citizens may
—must not disclose such data unless authorized enjoy benefits under the E-Commerce Act, including
under the Act. those related to professional practice.

UNLAWFUL ACTS AND PENALTIES

(1) Hacking or Cracking

Description: Hacking is accessing or interfering
with a computer or communication system
without the owner's consent, including
introducing viruses and causing corruption,
destruction, alteration, theft, or loss of electronic
data/messages/documents. Cracking is the act of
damage, corrupt, steal, or destroy electronic
data/messages/documents or software programs
using computer viruses or other means, including
use of an electronic device without the knowledge
and consent of the owner.
Fine: 100,000 to damage incurred
Imprisonment: 6 months to 3 years
(2) Piracy
Description: Unauthorized copying, distribution,
uploading, downloading, communication, or
broadcasting of protected material (e.g.,
copyrighted works, electronic signatures, sound
recordings), especially over telecommunication
networks (like the internet).