EIGHTEENTH CONGRESS OF THE 
]
REPUBLIC OF THE PHILIPPINES 
]
Second Regular Session 
]
SENATE
:Kq fi'A
20 JUN-9 P3S0
S.B. No. 1 591
Introduced by SEN. WIN GATCHALIAN
AN ACT
PROTECTING CONSUMERS AND MERCHANTS ENGAGED IN INTERNET 
TRANSACTIONS, CREATING FOR THIS PURPOSE THE ECOMMERCE 
BUREAU AND APPROPRIATING FUNDS THEREFOR
EXPLANATORY NOTE
From mobile shopping to online shopping, eCommerce has radically 
changed the way we live our lives. Whether as a consumer or a seller, 
technology and the internet have dramatically transformed the way 
businesses and transactions are conducted. The rise of digital technology saw 
the emergence of mobile networks and rapid advancement in computer 
technologies. As Bill Gates said, “[digital technology] is the center of attention 
for businesses, governments and individuals around the world. It has spawned 
entirely new industries, transformed existing ones, and become a global 
cultural phenomenon.”
From the buyer’s perspective, eCommerce is faster, cheaper and more 
convenient. Consumers are presented with a variety of options to meet their 
every need with a tap of a finger. eCommerce provides the consumers with 
time-saving options and access to swift delivery of goods and services. Finally, 
it presents value for money largely because from the seller’s perspective, set­
up costs are lower and operating costs are kept at a minimum. It has been 
said that from an enterprise’s perspective, eCommerce is the great equalizer, 
because MSME’s gain access to the same markets at low costs. Furthermore, 
the importance of eCommerce platforms in the ecosystem has become integral 
as they are able to aggregate multiple transactions. They play a key role in 
balancing the needs of consumers and sellers by facilitating fair and efficient 
trade between these two players.


Undeniably, technology has revolutionized our conventional way of 
buying and selling in ways unimaginable to those that have come before us.
Based on a recent 2019 study by Google and Temasek, in ASEAN alone, 
the Internet economy is experiencing exponential growth as total Gross 
Merchandise Value (GMV) in Southeast Asia has reached the $100B mark, 
and is projected to reach $300 billion in 2025. ASEAN economies have 
witnessed huge increases in internet economy from 2015 to 2019 and growth 
rate is expected to continue at 10%-30% from 2019 to 2025.
Notably, the Philippines has the lowest GMV in 2019 at $7B, lower than 
Malaysia ($11B), Vietnam ($12B), Singapore ($12B), Thailand ($16B), and 
Indonesia ($40B), this - despite the Philippines’ estimated 76 million active 
internet users and high internet penetration rate (71% vis-a-vis a global 
average of 54%), longer hours spent daily on internet (10 hours vis-a-vis a 
global average of 6 hours 42 minutes), and veiy high social media penetration 
for population aged 13+ (99% vis-a-vis a 59% global average).
This representation acknowledges that expected growth of the 
Philippine internet economy at 27% CAGR, is deemed to be one of the fastest 
among ASEAN economies. We acknowledge the findings of Google and 
Temasek and the aim of this bill is to ensure that this growth is achieved or 
even surpassed.
Indeed, eCommerce in the country is in its nascent stage, reflecting 
immense potential for businesses. The Philippines has not yet generated 
unicorns - a tech startup company that reaches a valuation of $1 billion - nor 
has our economy reflected the dynamism the Indonesian and Vietnamese 
eCommerce markets have reached, at 2.9% and 4.0% of GDP, respectively. 
The Philippines’ eCommerce market remains at 1.6% of GDP.
Philippine MSMEs lag behind the adoption of eCommerce because 
enterprises either find using digital technology platforms and tools too 
difficult, or are unaware of the benefits they offer. The Philippines also lacks 
policies and regulations that will facilitate online transactions and cross- 
border trade processes which should address the following concerns:
(a) 
Lack of trust;
(b) 
Internet infrastructure (Low internet speed experienced in 
Philippines);
(c) 
Logistics infrastructure (Weak last-mile delivery options; 
challenging topographical structure);
(d) 
Payment mechanisms (Payment gateways and currency 
exchange rates; Majority still prefer to pay in local currency 
against foreign currency);
(e) 
Lack of governing entity at the regional level that can fight 
cybercrime and settle cross-border disputes;
(f) 
Difficulty in the process of returning product;


(g) 
Taxation (VAT, customs duties and other charges, de 
minimis threshold, VAT registrations of foreign e-commerce 
operators, 12% VAT on total value of online transactions in 
the Philippines); and
(h) 
Online consumer complaints.
This bill seeks to create an environment founded on trust among 
consumers and merchants, as a means to increase the number of eCommerce 
participants, and ultimately achieve sustainable growth. This bill will address 
the need to establish a singular office that will: (1) be given the responsibility 
to carry out provisions of this bill; (2) ensure the implementation of Republic 
Act. No. 8792 or the Electronic Commerce Act of 2000; and (3) be the focal 
point in the monitoring and implementation of the Philippine eCommerce 
roadmap.
In view of the foregoing, approval of this bill is eariT^ly sought.


EIGHTEENTH CONGRESS OF THE 
]
REPUBLIC OF THE PHILIPPINES 
]
Second Regular Session 
]
SENATE
Ltai£
of tl;c gsi'trrtfu-l'
20 JUN-9 P3S0
Introduced by SEN. WIN GATCHALIAN
AN ACT
PROTECTING CONSUMERS AND MERCHANTS ENGAGED IN INTERNET 
TRANSACTIONS, CREATING FOR THIS PURPOSE THE ECOMMERCE 
BUREAU AND APPROPRIATING FUNDS THEREFOR
1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
Be it enacted by the Senate and the House of Representatives of the 
Philippines in Congress assembled:
SECTION 1. Short Title. - This act shall be known as the uInternet 
Transactions Acf.
SEC. 2. Declaration of Policy. - It is the policy of the State to 
promote the growth of electronic commerce (eCommerce) in the country by 
building trust between online sellers and consumers. The State recognizes the 
growth of the digital economy where digital access to goods and services is 
secure, fast, and accessible to consumers, and where businesses are more 
readily able to adopt innovations to increase their efficiency. Towards these 
ends, the State shall ensure fair business and advertising practices, secure 
online transactions through appropriate disclosure, maintain data privacy 
rights, affirm the paramount importance of product safety, and enable all 
consumers and businesses to have meaningful access to effective 
mechanisms for dispute resolution.


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
SEC. 3. Definition of Terms. - As used in this Act:
(A) 
Compatibility refers to the ability of the digital content or digital 
service to function with hardware or software with which digital 
content or digital services of the same type are normally used, 
\vithout the need to convert the digital content or digital service;
(B) 
Consumer refers to a natural or juridical person who is a 
purchaser, lessee, recipient or prospective purchaser, lessor or 
recipient of consumer products, services, credit, technology, 
advertising or promotion, and other items in eCommerce;
(C) 
Consumer-to-Consumer Transactions (C2Cs) refer to one-off, petty, 
or occasional low-value transactions of an individual to another 
that are not made in the ordinary course of business;
(D) 
Digital contents refer to data which are produced and supplied in 
electronic form;
(E) 
Digital products refer to goods and services transacted over the 
internet;
(F) 
Digital service refers to a service that allows the consumer to 
create, process, store or access data in electronic form or allows 
the sharing of or any other interaction with data in electronic 
form uploaded or created by the consumer or other users of that 
service;
(G) 
eCommerce Philippine Trustmark refers to the mark approved by 
the eCommerce Bureau that assures consumer protection for 
online transactions and consumer complaints;
(H) 
Electronic Commerce or eCommerce refers to the production, 
distribution, marketing, sale, or delivery of goods and services by 
electronic means;
(I) 
Functionality refers to the ability of the digital content or digital 
service to perform its functions according to its purpose;


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
(J) 
Goods or Digital Goods refer to physically produced items over 
which ownership rights may be established and whose economic 
ownership may be passed from one institutional unit to another 
by engaging in transactions;
(K) 
Interoperability refers to the ability of the digital content or digital 
service to function with hardware or software different from those 
with which digital content or digital services of the same type are 
normally used;
(L) 
Online eCommerce Platform refers to a natural or juridical person 
that solicits the purchase of digital products through digital 
platforms and marketplaces whose business is to connect online 
buyers and online sellers, facilitating sales of products, goods or 
services through the internet with the presence and use of 
monetary transaction.
(M) 
Online merchant refers to any natural, or juridical person, 
irrespective of whether privately or publicly owned, that directly 
sells, manufactures goods, or offers for sale, any goods and 
services, in the ordinary course of business over the internet, 
through a website, an online marketplace, a social media website 
or application or through other similar means.
(N) 
Price refers to money or a digital representation of value that is 
due in the exchange for the supply of digital products, whether 
goods and services, digital content, or digital service;
(O) 
Producer refers to the manufacturer or importer of goods, or any 
person purporting to be a manufacturer who places its name, 
trademark, or other distinctive sign on the goods;
(P) 
Repair refers to bringing goods into conformity with the contract, 
in case of defective goods;
(Q) 
Trader refers to any natural person, or juridical person 
irrespective of whether privately or publicly owned, who is acting, 
including through any other person acting on the trader’s name


1 
or on the trader’s behalf, for purposes relating to the trader’s
2 
business, craft, or profession, in relation to contracts covered by
3 
this Act.
4
5 
SEC. 4. Scope and Coverage. - This Act applies to the sale or
6 
exchange of digital products, including the following:
7 
(A) 
Internet retail of consumer goods;
8 
(B) 
Online travel services, covering the purchase of flights, hotel
9 
accommodations, and vacation rental spaces;
10 
(C) Digital media providers, including advertising, gaming, music
11 
subscription, and video on demand;
12 
(D) Ride hailing services for personal transport, delivery of food and
13 
merchandise; and
14 
(E) Financial services offered through digital online platforms, such
15 
as online payments, remittances, online lending, online
16 
investment, and online insurance services.
17
18 
SEC. 5. eCommerce Bureau. - To coordinate and supervise the
19 
implementation of this Act, and to promote the growth of the eCommerce
20 
sector, there is hereby created the eCommerce Bureau, hereinafter referred to
21 
as the Bureau, under the Department of Trade and Industry (DTI), to perform
22 
the following functions:
23 
(A) Implement, monitor, and ensure strict compliance by eCommerce
24 
stakeholders of the provisions of this Act;
25 
(B) Build trust between consumers and sellers to promote
26 
eCommerce growth;
27 
(C) Coordinate the formulation of policies, plans and programs to
28 
increase the number of online merchants and consumers;
29 
(D) Act as a virtual one stop shop for consumer complaints on
30 
internet transactions, and facilitate the speedy resolution of


1 
consumer complaints by the respective government agency which
2 
has jurisdiction over the complaint;
3 
(E) 
Compel or petition any entity, government agency or
4 
instrumentality of take action on any matter that may impeded
5 
eCommerce;
6 
(F) 
Monitor the compliance of other government agencies or
7 
instrumentalities on their compliance to the provisions of this Act
8 
and the eCommerce roadmap;
9 
(G) 
Represent the Philippines in international negotiations to
10 
promote cross border eCommerce transactions;
11 
(H) 
Collect, compile, analyze, abstract, and publish eCommerce data
12 
for policy formulation and program development;
13 
(I) 
Prepare and conduct periodic studies on eCommerce;
14 
(J) 
Collaborate with departments of the national government
15 
including local government units and government-owned or
16 
controlled corporations in implementing programs to promote
17 
eCommerce, including information, education, and campaign, as
18 
well as in ensuring a policy regime that is pro-active; and
19 
(K) 
Recommend executive and legislative measures to ensure a
20 
regulatory framework that encourages growth of the sector.
21
22 
SEC. 6. Composition of the Bureau. - The Bureau shall be headed
23 
by a commissioner who must have sufficient knowledge and background in
24 
production, distribution, marketing, sale, or. delivery of goods and services by
25 
electronic means.
26 
The commissioner shall be assisted by six (6) deputy commissioners;
27 
one (1) for administration, one (1) for finance, one (1) for planning, one (1) for
28 
operations, one (1) for franchising, and one (1) for law enforcement and
29 
adjudication. All deputy commissioners must be career executive service
30 
officers with at least ten (10) years of experience and practice in eCommerce.


1 
The commissioner and deputy commissioners shall be appointed by the
2 
President of the Philippines upon the recommendation of the Secretary of
3 
Trade and Industry.
4
5 
SEC. 7. Code of Conduct. - To build trust in online businesses and
6 
in keeping consumers’ interests primordial, all businesses engaged in
7 
eCommerce are expected to act responsibly, consistent with the following
8 
principles:
9 
(A) Treat consumers with honesty, integrity, and fairness, and
10 
refrain from engaging in illegal, fraudulent, unethical, or unfair
11 
business practices that harm consumers;
12 
(B) Uphold their responsibilities to the public and to the State, and
13 
to apply the rights of consumers equally;
14 
(C) Comply with applicable laws and regulations, especially the
15 
protection of intellectual property rights;
16 
(D) Ensure that goods and services marketed and sold online to
17 
Philippine consumers conform to Philippine regulatory standards
18 
and provide accurate information about the digital products in
19 
Filipino and English;
20 
(E) Ensure that the safety of digital products marketed or sold online
21 
are not compromised and that products that have been recalled
22 
in the offline retail market are not marketed or sold online;
23 
(F) Be honest and truthful in all representations and all information
24 
on digital products or services must be easily accessible,
25 
complete, and correct and promoted through fair advertising and
26 
marketing practices;
27 
(G) Be transparent to consumers about costs and avoid any hidden
28 
charges or additional costs such as customs duties, currency
29 
conversion, and shipping, or delivery;


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
(H) 
Allow for tracking of deliveries by online merchants and provide 
complete records of the goods purchased and have them delivered 
within the promised time and described condition;
(I) 
Offer cancellation options in order that consumers may be able 
to review their online orders before finally confirming their 
purchase, and be able to withdraw from a confirmed transaction 
in appropriate circumstances;
(J) 
Take consumer complaints seriously and address them fairly by 
instituting comprehensive and equitable mechanisms for 
consumer redress through easy, fair, and transparent methods, 
and provide compensation, refund, repair, and replacement, if 
warranted;
(K) 
Keep private information private by strictly complying with all 
applicable data privacy laws and regulations including Republic 
Act No. 10173, otherwise known as the “Data Privacy Act of 
2012', and other similar laws and regulations;
(L) 
Ensure the safety and security of online payments and safeguard 
sensitive data by using secure technology and protocols as 
evidenced by visible trust certificates;
(M) 
Avoid online spamming except online spamming or unsolicited 
commercial email or bulk email subject to the control and 
discretion of the consumer through readily accessible 
configurations allowing the consumer to choose whether they 
wish to receive or opt-out from commercial messages by email or 
electronic means;
(N) 
Avoid improper conduct such as producing fake online reviews or 
spreading wrong information about competitors but allowing 
consumers to make critical reviews about digital products; and
(O) 
Educate consumers about online risks as a priorily by informing 
the consumers about risks of internet transactions and providing 
competent and professional advice.


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
Whenever appropriate, the DTI shall issue the corresponding rules and 
regulations in accordance with international best practices.
SEC. 8. Qualifications to Engage in eCommerce. - The following are 
presumed legally authorized to engage in eCommerce in the Philippines in the 
ordinary course of their trade or business:
(A) 
A Filipino individual who is duly licensed to do business as a 
single-proprietor with the DTI;
(B) 
A Filipino juridical entity that is duly registered with the 
Securities and Exchange Commission (SEC), whether as a 
corporation, a one-person corporation, or as a partnership;
(C) 
A Filipino cooperative that is duly licensed by the Cooperative 
Development Authority (CDA); and
(D) 
A foreign corporation that is duly licensed by the SEC to transact 
business in the Philippines.
A resident of the Philippines who engages in unauthorized eCommerce 
activities in the ordinary course of trade or business shall be subject to the 
penal provisions of this Act.
A person who is authorized to engage in eCommerce in the Philippines 
and who facilitates the sale of a digital product or service by one who is not 
so authorized is deemed primarily liable for any obligation, damage, or fine, 
that may arise from the transaction or from the digital product.
A non-resident of the Philippines who engages in eCommerce by 
marketing goods or services that are accessible in the Philippines may not 
evade legal liability in the Philippines owing to the fact of non-residency, and 
shall be subject the same obligations and liabilities arising from any 
transaction as those who are authorized to engage in eCommerce in the 
Philippines.


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
SEC. 9. Business Registration. -
(A) 
To encourage the formation of business enterprises, the growth 
and integrated development of eCommerce, and protection of 
online consumers, all individuals engaged in internet 
transactions as Online Merchants or as Online eCommerce 
Platforms shall register as a business either as a sole proprietor, 
one-person corporation, partnership, corporation, or 
cooperatives.
(B) 
No person shall be allowed to engage in eCommerce, including 
the sale of any digital product without a license to operate. Any 
entity, whether natural or juridical, who offers to sell or have been 
found engaged in any internet transaction without a license to 
operate is in violation of this Act; Provided, however, That 
consumer to consumer transactions shall not be covered by this 
Act. For the first year of implementation, the penalty for 
unregistered online merchants and first-time offenders shall be 
waived upon presentation of business registration papers.
(C) 
All regulatory agencies responsible for business registration 
whether for sole proprietorships, one-person corporations, 
partnerships, corporations, or cooperatives, shall extend its 
jurisdiction or regulatory powers over business websites and 
other communication channels covering internet transactions. 
The DTI or any of the implementing agencies shall have the 
authority to enforce website takedown procedures, and shall 
report the violator to the Bureau of Internal Revenue.
(D) 
Consistent with Republic Act No. 11032, otherwise known as the 
“Ease of Doing Business Act,” all National Government agencies 
and local government agencies (LGUs) shall make available online 
registration of business permits and licenses particularly for 
those engaged in eCommerce.


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
(E) The SEC, LGUs, and the CDA shall submit to the DTI an annual 
list of registered enterprises for monitoring and for purposes of 
maintaining a database of online merchants.
SEC. 10. Regulatory •Jurisdiction of the DTJ. - The DTI shall exercise 
primary regulatory jurisdiction over any website, webpage, social media 
account, or other similar platform that markets digital products that are 
accessible in the Philippines, regardless of whether the owner of the website, 
webpage, social media account, or other similar platform is authorized to 
engage in eCommerce in the Philippines. The jurisdiction of the DTI includes 
the authority to order the owner of the website, webpage, social media 
account, or other similar platform to desist from marketing or offering goods 
or services that are accessible in the Philippines on account of violation of this 
Act, or any other consumer or trade laws and regulations, as well as the 
prerogative to refer the matter to the Bureau of Internal Revenue for 
appropriate action.
SEC. 11. Obligations of Online eCommerce Platforms. -
(A) Online eCommerce Platforms shall ensure that any commercial 
communication shall:
(i) 
Be clearly identifiable as a commercial communication;
(ii) 
Clearly identify the person on whose behalf the commercial 
communication is made;
(iii) 
Clearly identify any promotional offer including any 
discount, premium, or gift, and ensure that any conditions 
which must be met to qualify for it are easily accessible, 
and presented clearly and unambiguously; and
(iv) 
Clearly identify any promotional competition or game and 
ensure that any conditions for participation are easily 
accessible and presented clearly and unambiguously.
10


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
(B) 
Online eCommerce Platforms shall require all Online Merchants, 
prior to the latter’s onboarding to submit the following:
(i) 
Name of the online merchant;
(ii) 
Registration documents of the online merchant from the 
appropriate regulatory authority, including but not limited 
to business permits, certificate of registration, barangay 
clearance;
(iii) 
Geographic address at which the online merchant is 
established;
(iv) 
Details of the online merchant, a mobile or landline 
number, and a valid electronic mail address, which makes 
it possible to immediately and easily contact and 
communicate with the online merchant and communicate 
in a direct and effective maniier; and
(v) 
Details of any professional body or similar institution with 
which the online merchant is registered, in instances when 
the online merchant exercises a regulated profession.
(C) 
Online eCommerce Platforms shall maintain a file of aU registered 
online merchants which shall be regularly verified and updated.
(D) 
Online eCommerce Platforms shall publish on their website, 
webpage, social media account, or other similar platform, the 
following general information:
(i) 
Name of the online merchant;
(ii) 
Registration documents of the online merchant from the 
appropriate regulatory authority, including but not limited 
to business permits, certificate of registration, barangay 
clearance;
(iii) 
Geographic address at which the online merchant is 
established;
(iv) 
Details of the online merchant, a mobile or landline 
number, and a valid electronic mail address, which makes
11


1 
it possible to immediately and easily contact and
2 
communicate with the online seller and communicate in a
3 
direct and effective manner; and
4 
(v) Details of any professional body or similar institution with
5 
which the online merchant is registered, in instances when
6 
the online merchant exercises a regulated profession.
7 
(E) Online eCommerce Platforms shall submit to the Bureau a list of
8 
all online merchants registered under their platform. When an
9 
Online eCommerce Platform discovers that an online merchant
10 
has not obtained registration documents from the relevant
11 
regulatory agency, it shall report such fact to the Bureau within
12 
fifteen (15) days from discovery thereof.
13 
Where the Online eCommerce Platform provides prices, the prices shall
14 
be indicated clearly and unambiguously and, in particular, shall indicate
15 
whether the prices are inclusive of taxes and delivery costs.
16
17 
SEC. 12. Internet Transactions Involving Consumers. - An online
18 
merchant of goods shall exercise the following responsibilities:
19 
(A) Deliver or cause the delivery of goods to the consumer ensuring
20 
the following requirements:
21 
(i) The goods are of the description, tjqre, quantity, and
22 
quality, and possess the functionality, compatibility,
23 
interoperability and other features, as required by the sales
24 
contract;
25 
(ii) The seller must show a sample or a model of the goods to
26 
the consumer and the goods possess the quality of and
27 
correspond to the description of the sample or model;
28 
possess the qualities and performance features, including
29 
in relation to functionality, compatibility, interoperability,
30 
accessibility, continuity, and security, normal for digital
31 
content or digital services of the same type and of which
12


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
the consumer may reasonably expect; fir for any particular 
purpose for which the consumer requires them and which 
the consumer made known to the seller at the time of the 
conclusion of the contract, and which the seller has 
accepted; and possess the qualities and performance 
capabilities indicated in any pre-contractual statement 
which forms an integral part of the contract.
(iii) All digital goods shall:
(a) 
Be delivered along with the accessories including 
packaging, installation instructions or other 
instruction as the consumer may expect to receive; 
and
(b) 
Possess qualities and performance capabilities which 
are normal in goods of the same type and which the 
consumer may expect given the nature of the goods 
and taking into account any public statement made 
by or on behalf of the seller or other persons in earlier 
links of the chain of transactions, including the 
producer, unless the online merchant shows that:
1. 
The online merchant was not, and could not 
reasonably have been aware of the statement 
in question;
2. 
By the time of conclusion of the contract, the 
statement had been corrected; or
3. 
The decision to buy the goods could not have 
been influenced by the statement.
(B) Be liable for any lack of conformity with the contract which exists 
at the time when:
(i) The consumer or a third party indicated by the consumer 
other than the carrier has acquired the physical possession 
of the goods, or when the goods are handed over to the
13


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
carrier chosen by the consumer, and that carrier was not 
proposed by the seller or where the seller proposes no 
means of carriage;
(ii) 
The goods were installed by the seller or under the seller’s 
responsibility, and the time when the installation is 
completed is considered as the time when the consumer 
has acquired the physical possession of the goods;
(iii) 
The goods were intended to be installed by the consumer, 
and the time when the consumer had reasonable time for 
the installation not later than thirty (30) days after the time 
indicated in subparagraph (a) of paragraph B, is considered 
as the time when the consumer has acquired the physical 
possession of the goods.
(iv) 
The goods are incorrectly installed. Any lack of conformity 
resulting from the correct installation is regarded as lack of 
conformity with the contract of the goods if:
(a) 
The goods were installed by the seller or under the 
seller’s responsibility; and
(b) 
The goods, intended to be installed by the consumer, 
were installed by the consumer and the correct 
installation was due to a shortcoming in the 
installation instructions.
(C) Where the contract provides that the digital content or digital 
service is to be supplied or made accessible to the consumer over 
a period of time, the seller may modify the digital content or 
digital service beyond what is necessary to maintain the digital 
content or digital service in conformify, if the following conditions 
are met:
(i) The contract allows, and provides a valid reason for, such 
a modification;
14


1 
(ii) 
Such a modification is made without additional cost to the
2 
consumer; and
3 
(iii) 
The consumer is informed in a clear and comprehensible
4 
manner of the modification.
5 
(D) Where the online merchant operates its own website, webpage,
6 
social media account, or any other similar platform, it shall
7 
publish on its homepage the following:
8 
(i) 
Name of the online merchant;
9 
(ii) 
Registration documents of the online merchant from the
10 
appropriate regulatory authority, including but not limited
11 
to business permits, certificate of registration, barangay
12 
clearance;
13 
(iii) 
Geographic address at which the online merchant is
14 
established;
15 
(iv) 
Details of the online merchant, a mobile or landline
16 
number, and a valid electronic mail address, which makes
17 
it possible to immediately and easily contact and
18 
communicate with the online seller and communicate in a
19 
direct and effective manner; and
20 
(v) 
Details of any professional body or similar institution with
21 
which the online merchant is registered, in instances when
22 
the online merchant exercises a regulated profession
23 
Any agreement is valid only if, at the time of the conclusion of the
24 
contract, the consumer has knowledge of the specific condition of the goods
25 
and the consumer has expressly accepted this specific condition when
26 
concluding the contract.
27
28 
SEC. 13. Right to Redress by Online Merchants. - Where the online
29 
merchant is liable to the consumer because of a lack of conformity with the
30 
contract resulting from an act or omission by a person in earlier links of the
15


1 
chain of transactions, the online merchant is entitled to pursue remedies
2 
against the person or persons liable in the chain of transactions.
3 
The person against whom the online merchant may pursue remedies
4 
and the relevant actions and conditions to exercise must be in accordance
5 
with the following:
6 
(A) A repair or replacement must be completed within a reasonable
7 
time and without any significant inconvenience to the consumer,
8 
taking into account the nature of the goods and the purpose for
9 
which the consumer acquired the goods;
10 
(B) A proportionate reduction of the price or the termination of the
11 
contract, including restitution of the price, in the following
12 
instances:
13 
(i) A repair or replacement is impossible or unlawful;
14 
(ii) The online merchant has not completed repair or
15 
replacement within a reasonable time;
16 
(iii) A repair or replacement may cause significant
17 
inconvenience to the consumer; or
18 
(iv) The online merchant has declared, or it is equally clear
19 
from the circumstances that the online merchant may not
20 
bring the goods in conformity with the contract within a
21 
reasonable time;
22 
(C) The consumer is entitled to withhold the payment of any
23 
outstanding part of the price, until the online merchant has
24 
brought the goods into conformity with the contract;
25 
(D) The consumer is not entitled to a remedy to the extent that the
26 
consumer has contributed to the lack of conformity with the
27 
contract or its effects;
28 
(E) Where the online merchant remedies the lack of conformity with
29 
the contract by replacement, the online merchant may take back
30 
the replaced goods at the online merchant’s expense unless the
31 
parties have agreed otherwise after the lack of conformity with
16


1 
the contract has been brought to the online merchant’s attention
2 
by the consumer;
3 
(F) Where the consumer had installed the goods in a manner
4 
consistent with their nature and purpose, before the lack of
5 
conformity with the contract became apparent, the cost for the
6 
removal of the non-conforming goods and the installation of
7 
replacement goods, and all associated costs shall be for the
8 
account of the online merchant;
9 
(G) In case of goods that do not conform to the contract, the
10 
consumer is not liable to pay for using the non-conforming goods
11 
prior to its replacement;
12 
(H) The consumer may choose between repair and replacement
13 
unless the option chosen is impossible, unlawful or, imposes
14 
costs upon the online merchant that is disproportionate, taking
15 
into account all circumstances, including:
16 
(i) The value the goods would have if the goods conformed to
17 
the contract;
18 
(ii) The significance of the lack of conformity with the contract;
19 
and
20 
(iii) Whether the alternative remedy may be completed without
21 
significant inconvenience to the consumer.
22 
The reduction of price is proportionate to the decrease in the value of
23 
the goods which were received by the consumer compared to the value the
24 
goods would have if in conformity with the contract.
25
26 
SEC. 14. Right to Terminate the Contract. - If the goods delivered do
27 
not conform to the contract, the consumer may exercise the right to terminate
28 
the contract by giving notice to the online merchant. Where the lack of
29 
conformity relates to only some of the goods delivered under the contract, the
30 
consumer may terminate the contract only in relation to the non-conforming
31 
good and any other goods which was acquired as an accessory it.
17


1 
Where the consumer terminates a contract as a whole or in relation to
2 
some of the goods delivered:
3 
(A) The online merchant shall reimburse to the consumer the price
4 
paid without undue delay and in any event not later than fourteen
5 
(14) days from receipt of the notice;
6 
(B) Upon receipt of the reimbursement from the online merchant, the
7 
consumer shall return, at the online merchant’s expense, the
8 
goods without undue delay and in any event not later than
9 
fourteen (14) days from the receipt of the reimbursement;
10 
(C) Where the goods cannot be returned because of destruction or
11 
loss, the consumer shall pay to the online merchant the monetary
12 
value which the non-conforming goods would have had at the
13 
date when the return was to be made if they had been kept by the
14 
consumer without destruction or loss until that date, unless the
15 
destruction or loss has been caused by a lack of conformity with
16 
the goods with the contract; and
17 
(D) The consumer shall pay for a decrease in the value of the goods
18 
only to the extent that the decrease in value exceeds depreciation
19 
through regular use. The payment for decrease in value shall not
20 
exceed the price paid for the goods.
21
22 
SEC. 15. Damages. - The online merchant is liable for damages to the
23 
consumer due to the lack of conformity with the contract of the goods:
24 
Provided, That the lack of conformity becomes apparent within two (2) years
25 
from the relevant time of establishing conformity.
26 
No damages may be recovered from this Act after the lapse of four (4)
27 
years from the time the conformity has been established.
28
29 
SEC. 16. Online Dispute Resolution. - The DTI shall develop an online
30 
dispute resolution (ODR) platform which is a single point of entry for
18


1 
consumers, online merchants and traders seeking out-of-court resolution of
2 
disputes.
3 
(A) The ODR shall be an interactive website which may be accessed
4 
electronically and free of charge. The DTI, through the Bureau,
5 
shall be responsible for its operation, including its maintenance,
6 
funding and date security. The ODR platform must be user-
7 
friendly and must adopt the twin principles of “privacy by design”
8 
and “design for all”, where the privacy of its users is respected
9 
from the design stage, and the ODR platform is accessible and
10 
usable by all, including vulnerable users.
11 
(B) The DTI shall establish a network of ODR contact points from,
12 
among others, the agencies involved in consumer complaints
13 
specified in Republic Act No. 7394, otherwise known as the
14 
“Consumer Act of the Philippines,” which includes the DTI’s Fair
15 
Trade Enforcement Bureau, Department of Agriculture,
16 
Department of Tourism, and the Department of Health. The
17 
National Privacy Commission arid the Intellectual Property Office
18 
of the Philippines shall also form part of the ODR network.
19 
(C) Each agency shall designate one ODR contact point and
20 
communicate its name and contact details to the DTI. The head
21 
of agency shall confer responsibility to the ODR contact points in
22 
ensuring that timely and competent support is provided to the
23 
resolution of disputes relating to complaints submitted through
24 
the ODR platform.
25 
(D) The ODR platform shall have the following functions:
26 
(i) Provide an electronic form by means of which alternative
27 
dispute resolution (ADR) entities shall transmit the
28 
information;
29 
(ii) Provide a feedback system which allows the parties to
30 
express their views on the functioning of the ODR platform
31 
and on the ADR entity which handles their dispute; and
19


1 
(iii) Make publicly available general information on ADR as a
2 
means of out-of-court dispute resolution and information
3 
on ADR entities which are competent to deal with disputes.
4 
(E) The DTI shall ensure that the information in the website is
5 
accurate, up to date and provided in a clear, understandable and
6 
accessible way.
7 
(F) Government and private sector entities which provide ADR
8 
services which are competent to deal with disputes shall be
9 
registered electronically with the ODR platform.
10 
(G) Digital platforms and online retailers shall provide on their
11 
websites an electronic link to the DTI ODR platform on their
12 
homepage. That link shall be easily accessible to consumers.
13 
(H) The DTI, in consultation with other concerned agencies, shall
14 
issue the implementing rules and regulations on the
15 
development, management, operations, and maintenance of the
16 
ODR platfoiin within three (3) months from the effectivity of this
17 
Act.
18
19 
SEC. 17. Joint and Solidary Liability. - Online eCommerce platforms
20 
shall share solidary liability with an online merchant under the following
21 
instances:
22 
(A) If the online eCommerce platform fails to exercise extraordinary
23 
diligence to prevent any loss or damage to the consumer;
24 
(B) If the identity of the online merchant and the online eCommerce
25 
platform is the same;
26 
(C) If the online eCommerce platform knows or should have known
27 
that the digital products sold do not comply with law, or otherwise
28 
infringes on intellectual property rights, and fails to take
29 
necessary measures;
30 
(D) If the online eCommerce platform fails to publish details of its
31 
online merchant;
20


1 
(E) If the online eCommerce Platform fails to examine digital
2 
products related to food, drugs, and cosmetics or otherwise
3 
relates to the life or health of consumers;
4 
(F) If an online merchant is not duly registered with the appropriate
5 
regulatory agencies and the online eCommerce platform permits
6 
the online merchant to sell digital products;
7
8 
SEC. 18. Digital Payments. - Online eCommerce Platforms and Online
9 
Merchants shall, issue paper or electronic invoices or receipts for all sales. An
10 
electronic invoice or receipt shall have the same legal effect as a physical
11 
invoice or receipt.
12 
Within sixty (60) days from the effectivity of this Act, the Bureau of
13 
Internal Revenue shall, in coordination with the Bureau of Customs, issue
14 
rules and regulations that modernize and streamline the regulatory
15 
framework and encourage the adoption of electronic pa3onent systems by the
16 
citizenry. The DTI and the Bangko Sentral ng Pilipinas shall also develop
17 
guidelines to protect merchants and consumers covering the various digital
18 
payment solutions.
19
20 
SEC. 19. Tax. Exemption for Newly Registered eCommerce
21 
Enterprises. - Newly registered micro-enterprises, as defined under existing
22 
laws, and which are engaged in eCommerce shall be exempt from all national
23 
and local taxes for the first two (2) years of operation under the following
24 
conditions:
25 
(A) The enterprise is not an affiliate, subsidiary, or a franchise of any
26 
existing company;
27 
(B) In the case of a sole proprietorship, one-person corporation or
28 
partnership, it does not have any previous or other existing
29 
registered companies, partnerships, or businesses; and
30 
(C) In the case of a corporation, each stockholder of the eCommerce
31 
enterprise must have at least a five percent (5%) share in stocks
21


1 
and the corporation must have no nominal stakeholders or
2 
stockholders holding the shares in trust for others: Provided,
3 
That all stockholders of the corporation shall not have held
4 
shares of a previous or existing corporation with at least a five
5 
percent (5%) share therein, nor registered any former or existing
6 
sole proprietorship or partnership.
7
8 
SEC. 20. eCommerce Philippine Trustmark. - To provide assurance
9 
of safety and security in internet transactions, an eCommerce Philippine
10 
Trustmark shall be developed for online merchants.
11 
(A) The DTI is tasked to create an eCommerce Philippines Trustmark
12 
to be administered and managed by an industry-led private
13 
sector governance body.
14 
(B) The industiy-led governance body comprises the following:
15 
(i) 
Two (2) representatives from the digital platforms;
16 
(ii) 
Two (2) representatives from the pa3mient gateways;
17 
(iii) 
Two (2) representatives from the logistics services;
18 
(iv) 
Two (2) representatives from other enablers; and
19 
(v) One (1) representative from the public sector.
20 
(C) An eCommerce Philippine Trustmark on the website of an online
21 
merchant signifies that the company is committed to the Code of
22 
Conduct stipulated in Section 8 of this Act, guaranteeing ethical
23 
standards in the digital marketplace.
24 
(D) In the case of a complaint involving the purchase of their
25 
products or services, those companies with the trustmark shall
26 
give consumers the option of filing claims through the trustmark
27 
portal, if the company’s customer care service has not been able
28 
to resolve the issue.
29 
(E) The eCommerce Philippines Trustmark shall be linked to DTI’s
30 
online ODR.
31
22


1 
SEC. 21. Implementing Agencies. - The provisions of this Act and its
2 
implementing rules and regulations shall be enforced by the following
3 
agencies:
4 
(A) Department of Trade and Industry, with respect to consumer
5 
products;
6 
(B) Department of Health, with respect to food, drugs, cosmetics,
7 
health products, and substances;
8 
(C) Department of Agriculture, with respect to products related to
9 
agriculture;
10 
(D) Intellectual Property Office of the Philippines, with respect to
11 
intellectual property, particularly on infringement of patents,
12 
trademarks, and copyrights;
13 
(E) 
Optical Media Board, with respect to digital media and
14 
enforcement of online piracy;
15 
(F) Philippine National Police, with respect to cybercrime; and
16 
(G) 
Bangko Sentral ng Pilipinas, with respect to the implementation
17 
of Republic Act No. 11127, otherwise known as the “National
18 
Payment Systems Act”
19
20 
SEC. 22. Jurisdiction. - The implementing agencies mentioned in
21 
Section 21 of this Act shall continue to exercise the powers and duties
22 
provided 
to them under existing laws, unless repealed or modified
23 
accordingly. All implementing agencies must develop and implement
24 
programs to inform and educate their respective stakeholders about
25 
eCommerce, including the provisions under this Act.
26
27 
SEC. 23. Penalties. -
28 
(A) Online merchants found guilty of violating Section 9, paragraph
29 
(B) of this Act or who fail to register either as a sole proprietor,
30 
one-person corporation, partnership, corporation, or cooperative,
31 
shall be punished with a fine equivalent to one hundred percent
23


1
2
3
4
5
6
7
8 
9
10
11
12
13
14
15
16
17
18
19
20 
21 
22
23
24
25
26
27
28
29
30
31
(100%) of the amount of the digital goods offered or sold based on 
the market price as determined by the Bureau, including 
confiscation of the digital products as advertised, and forfeiture 
of license; and
(B) Online eCommerce platforms and online merchants found guilty 
of violating Section 11 or Section 12 (D) of this Act shall be 
punished with a fine not less than Five Hundred Thousand Pesos 
(P500,000.00) but not more than Five Million Pesos 
(P5,000,000.00) or the revocation of their licenses, or both, at the 
discretion of the court.
SEC. 24. Appropriations. - The amount of Fifty million pesos 
(P50,000,000.00) for the initial operation of the Bureau is hereby appropriated 
out of any funds in the National Treasury not otherwise appropriated. 
Thereafter, such sum as may be necessary for the continued implementation 
of this Act shall be included in the annual General Appropriations Act.
SEC. 25. Separability Clause. - If any provision or part of this Act is 
declared invalid or unconstitutional, such declaration shall not affect the 
validity of the remaining provisions of this Act.
SEC. 26. Repealing Clause. - All laws, rules, and regulations, 
presidential decrees, letters of instruction and other presidential issuances 
which are incompatible or inconsistent with the provisions of this Act are 
hereby repealed amended, or modified accordingly.
SEC. 27. Bffectivity Clause. - This Act shall take effect thirty (30) days 
after its publication in the Official Gazette or in a newspaper of general 
circulation.
Approved,
24