Republic of the Philippines _
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
First Regular Session

House Bill No.__ 4433

Introduced by Honorable Sherwin T. Gatchalian

EXPLANATORY NOTE

This bill seeks to provide an additional circumstance in
determining whether a sales act or practice is unfair or
unconscionable, amending for the purpose Republic Act (RA)
No. 7394, otherwise known as the “Consumer Act of the
Philippines.”

RA 7394 is a government regulation that is aimed at
protecting consumers’ rights and welfare. It has been in
existence for 22 years with some minor amendments. In order
to be responsive to the prevailing times, this measure intends
to add another provision in Article 52 of RA 7394 to further
protect consumers.

In line with the State’s objective to protect consumers
from deceptive, unfair and unconscionable sales act and
practices, this bill is being proposed to undo the prevailing
practice of stores, merchants and other suppliers of denying
sale transactions because of the absence of change, or their


failure to provide the exact amount of change, or giving
candies or other items as change in lieu of money.

In view of the foregoing, passage of this billis earnestly

sought.
.
My
fn . GATCHALIAN



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
First Regular Session

House Bill No. 4433

Introduced by Honorable Sherwin T. Gatchalian

AN ACT
PROVIDING FOR AN ADDITIONAL CIRCUMSTANCE IN
DETERMINING WHETHER A SALES ACT OR PRACTICE IS
UNFAIR AND UNCONSCIONABLE, AMENDING FOR THE
PURPOSE ARTICLE 52 OF REPUBLIC ACT NO. 7394,
OTHERWISE KNOWN AS THE “CONSUMER ACT OF THE
PHILIPPINES”

Be it enacted by the Senate and the House of Representatives of
the Philippines in Congress assembled:

SECTION 1. Article 52 of Republic Act No. 7394 is hereby
amended by inserting a new paragraph () to read as follows:

“ART. 52. Unfair or Unconscionable Sales Act
or Practice. - An unfair or reasonable sales act or
practice by a seller or supplier in connection with a
consumer transaction violates this Chapter whether
it occurs before, during or after the consumer
transaction. An act or practice shall be deemed
unfair or unconscionable whenever the producer,
manufacturer, distributor, supplier or seller, by
taking advantage of the environment or
surroundings, induces the consumer or gross one-


sided in favor of the producer, manufacturer,
distributor, supplier or seller.

An act or practice shall be deemed unfair or
unconscionable whenever the producer,
manufacturer, distributor, supplier or seller, by
taking advantage of the consumer's physical or
mental infirmity, ignorance, illiteracy, lack of time
or the general conditions of the environment or
surroundings, induces the consumer to enter into a
sales or lease transaction grossly inimical to the
interests of the consumer or grossly one-sided in
favor of the producer, manufacturer, distributor,
supplier or seller.

In determining whether an act or practice is
unfair and unconscionable, the following
circumstances shall be considered:

a) Xxx;
RK;

d) that when the consumer transaction was
entered into, the seller or supplier was
aware that there was no_ reasonable
probability or payment of the obligation in
full by the consumer; [and]

e) that the transaction that the seller or
supplier induced the consumer to enter into
was excessively one-sided in favor of the
seller or supplier|.]; AND

f) THAT THE CONSUMER TRANSACTION
WAS DENIED BECAUSE OF AN ALLEGED
SHORTAGE OF COINS OR CHANGE ON
THE PART OF THE SELLER, OR THAT THE
CONSUMER WAS SHORTCHANGED BY
THE GIVING OF CANDIES OR OTHER


ITEMS IN LIEU OF MONEY AS CHANGE,
OR WHEN DUE TO LACK OF TIME, THE
CONSUMER ENTERS INTO THE
TRANSACTION EVEN IF IT MEANS
WAIVING THE CHANGE DUE.

SEC. 2. Implementing Rules. - Within sixty (60)
days from the approval of this Act, the Secretary of Trade
and Industry shall promulgate the necessary rules and
regulations to ensure the effective implementation of this
Act.

SEC. 3. Separability Clause. - If any section or
provision of this Act is held unconstitutional or invalid,
the remaining parts or provisions not affected shall
remain in full force and effect.

SEC. 4. Repealing Clause. - All laws, presidential
decrees, executive orders, rules and regulations or part
thereof, contrary to or inconsistent with the provisions of
this Act, are hereby repealed or modified accordingly.

SEC. 5. Effectivity Clause. - This Act shall take
effect fifteen (15) days after its publication in the Official
Gazette or in a newspaper of general circulation.

Approved,