Question & AnswerQ&A (Republic Act No. 7394)
The short title of Republic Act No. 7394 is the "Consumer Act of the Philippines."
The policy of the State is to protect the interests of the consumer, promote general welfare, and establish standards of conduct for business and industry, including protection against health hazards, deceptive sales practices, provision of consumer information, and rights of redress.
A consumer is defined as a natural person who is a purchaser, lessee, recipient or prospective purchaser, lessor, or recipient of consumer products, services, or credit primarily for personal, family, household, or agricultural purposes.
They are sales schemes where a person invests to get the right to recruit more persons who also invest, with profits primarily derived from recruitment rather than sale of products or services, and are prohibited under the Act.
The Department of Health enforces provisions related to food, drugs, cosmetics, devices, and hazardous substances; the Department of Agriculture handles agricultural products; and the Department of Trade and Industry enforces other consumer product standards.
Imported consumer products may be refused admission if they do not comply with quality and safety standards, are deemed injurious, unsafe, dangerous, substandard, materially defective, or banned in the country of manufacture.
Violations may result in fines ranging from One thousand pesos (P1,000.00) to Ten thousand pesos (P10,000.00), imprisonment from two months to one year, or both. Alien offenders may be deported, and corporate officers may also be held liable.
Labels must include the correct trade or brand name, registered trademark, business name and address of manufacturer/importer, active ingredients, net quantity in metric units, country of manufacture if imported, and other necessary warnings as prescribed by rules.
Manufacturers, producers, importers, and suppliers are liable independently of fault for damages caused by defective products or inadequate information on their use or hazards. Liability extends to tradesmen and sellers under certain conditions.
Any advertisement that is false, deceptive or misleading regarding the sponsorship, characteristics, quality, price, or any material fact of consumer products or services, or fails to disclose material facts that would affect consumer decisions.
Consumer arbitration officers must be college graduates with at least three years experience in consumer protection and good moral character. They have original and exclusive jurisdiction to mediate, hear, and decide all consumer complaints subject to judicial action.
Finance charges include all charges payable by the consumer related to extending credit, including interest, collection fees, and premiums for credit insurance. The actual maximum rate is prescribed by implementing agency regulations.
The Act requires express warranties to be clearly stated and operative from the moment of sale, provides for enforcement of warranties without extra documentary requirements, and establishes minimum standards for full and limited warranties.
The Act applies notwithstanding agreements to the contrary but does not restrict or derogate any other rights or remedies available to consumers under other laws.
Consumer claims must be filed within two (2) years from the consummation of the consumer transaction or from the commission of the deceptive, unfair, or unconscionable act or practice, or from discovery of hidden defects.