EIGHTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES )
First Regular Session )

HOUSE OF REPRESENTATIVES,

Introduced by Represt

House Bill No. 3799
EXPLANATORY NOTE

Batas Pambansa Big. 22 otherwise known as “An Act Penalizing the Making or
Drawing and Issuance of a Check without Sufficient Funds or Credit,” was passed to curb
the issuance of bouncing checks. However, despite the passage of the said law, bouncing
checks continue to proliferate the market. What is worse, bouncing checks were likewise
used by persons engaged in pyramid scams as payments for the recruited investors either
as a return of their investments or commissions for recruiting other investors. Our people
have been defrauded by different pyramid scams which involved billions of pesos such as
the Multitel of Rose Baladjay in 2002, the SMFund, Francswiss and PIPC in 2007, the Royal
Manchester Five in 2008, the Legacy Group of Companies, and most recently the Kapa
Community Ministry,

Under the Negotiable Instruments Law which governs the issuance of checks, it is
not required that the name of the drawer should appear on the face of the checks. Only the
signature of the drawer is required. However, the victims of the pyramid scams had difficulty
in filing cases for bouncing checks because they did not know who were the
signatories/drawers of the checks especially in cases of corporations. This bill seeks to
address this problem by requiring the drawer/s of the checks to legibly print his/her/their
name/s before signing the check.

In view of the foregoing, the passage of this bill is eamestly sought

RumUs/B. ROD!


EIGHTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES )
First Regular Session )

HOUSE OF REPRESENTATIVES

y Representative Rufus

3799

3. Rodriquez

House Bill No.

AN ACT
AMENDING ACT NO. 2031, OTHERWISE KNOWN AS THE NEGOTIABLE
INSTRUMENTS LAW, BY REQUIRING THE DRAWER OF THE CHECK TO LEGIBLY
PRINT HIS/HER NAME BEFORE SIGNING THE SAME

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

Section 1. Declaration of Policy. — It is the declared policy of the state to protect its people
and economy from the proliferation or worthless or bouncing checks.

Section 2. Amendment. Section 1 of Act No. 2031, otherwise known as The Negotiable
Instruments Law, is hereby amended to read as follows:

"Section 1. Form of negotiable instruments. - An instrument to be
negotiable must conform to the following requirements

(a) It must be in writing and signed by the maker or drawer.
(b) Must contain an unconditional promise or order to pay a sum certain
in money;
(c) Must be payable on demand, or at a fixed or determinable future
time;
(@) Must be payable to order or to b--earer; and
(e) Where the instrument is addressed to a drawee, he must be named
or othenwise indicated therein with reasonable certainty.

IN CASE OF A CHECK, THE DRAWER MUST LEGIBLY PRINT
HIS OR HER NAME BEFORE SIGNING THE SAME.

Section 3. Repealing Clause. - All laws, orders, issuances, rules and regulations or parts
thereof inconsistent with this Act are hereby repealed or modified accordingly

Section 4. Effectivity. - This Act shall take effect fifteen (15) days after its complete
publication in at least two (2) newspapers of general circulation

Approved,