SIXTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES 
Third Regular Session 
SENATE 
S.No. 
2992 
) 
) 
) 
Introduced by Senator Miriam Defensor Santiago 
EQUAL CREDIT OPPORTUNITY ACT 
EXPLANATORY NOTE 
"15 GCT14 P3:39 
The activities of the country's leading institutions are regulated by the General 
Banking Law, the Central Banking Act, pertinent provisions of the New Civil Code, and 
such special laws as the Truth in Lending Act. In aU these laws, nowhere is it provided 
that financial institutions and other firms engaged in the extension of credit must make 
credit available with fairness, impartiality, and without discrimination on the basis of sex, 
marital status, race, creed, religion, or age. 
This bill seeks to fiU the gap in existing laws by requiring the country's financial 
institutions and other finns engaged in the extension of credit to make equally available 
to all credit worthy customers without regard to sex, marital status, national origin, 
religion, or age. A regime of equality credit extension will enhance economic stability. It 
will also foster friendly competition among the various financial institutions and other 
finns engaged in the extension of credit.! 
~'- ~~~ ,O,~ 
~IRIAM DEF~SOR ~NT~GO 
1 This bill was originally filed during the Thirteenth Congress, First Regular Session. 
I 


SIXTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES 
Third Regular Session 
SENATE 
S. No. 
2992 
) 
) 
) 
Introduced by Senator Miriam Defensor Santiago 
EQUAL CREDIT OPPORTUNITY ACT 
'15 
OCT 14 P3:40 
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 "Equal Credit 
2 
Opportunity Act." 
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SECTION 2. Declaration of Policy. - It is hereby declared a state policy to 
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enhance economic stability and foster competition among the country's financial 
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institutions by requiring these and other firms engaged in the extension of credit to make 
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credit equally available to all credit-worthy customers with fairness, impartiality, and 
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without discrimination. 
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SECTION 3. Definition of Terms. - In this Act, the term-
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(A) 
"Adverse action" means a denial or revocation of credit, a change in the 
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terms of an existing credit arrangement, or a refusal to grant credit in substantially the 
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amount or on substantially the terms requested. Such term does not include a refusal to 
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extend additional credit under an existing credit arrangement where the applicant is 
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delinquent or otherwise in default, or where such additional credit would exceed a 
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previously established credit limit; 
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(B) 
"Applicant" means any person who applies to a creditor directly for an 
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extension, renewal or continuation of credit, or applies for a credit indirectly by use of an 
17 
existing credit plan for an amount exceeding a previously established credit limit; 
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1 
(C) 
"Board" refers to the Central Monetary Board; 
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(D) 
"Credit" means the right granted by a creditor to a debtor to defer payment 
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of debt or incur debt and defer its payment or to purchase property or services and defer 
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payment therefore; 
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(E) 
"Creditor" means any person who regularly extends, renews, or continues 
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credit, any person who regularly arranges for the extension, renewal, or continuation of 
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credit; or any assignee of an original creditor who participates in the decision to extend, 
S 
renew, or continue credit; and 
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(F) 
"Person" means a natural person, a corporation, a government or 
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governmental subdivision or agency, trust, estate partnership, cooperative or association. 
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SECTION 4. Activities Constituting Discrimination. - It shall be unlawful for any 
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creditor to discriminate against any applicant, with respect to any aspect of a credit 
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transaction -
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(1) 
On the basis of race, color, religion, national origin, sex or marital status, or 
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age (provided the applicant has the capacity to contract); 
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(2) 
Because all or part of the applicant's income derives from the dole-outs or 
17 
any public assistance program; or 
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(3) 
Because the applicant has in good faith exercise any right under this Act. 
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SECTION 5. Activities Not Constituting Discrimination. - It shall not constitute 
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discrimination for purposes of this Act for a creditor-
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(1) 
To make an inquiry as to marital status if such inquiry is for the purpose of 
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creating a valid lien, passing clear title, waiving inchoate rights to property; or assigning 
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earnings; 
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(2) 
To request the signature of both parties to a marriage for the purpose of 
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creating a valid lien, passing clear title, waiving inchoate rights to property; or assigning 
2 


earnings. Provided, however, that this subsection shall not be construed to permit a 
2 
creditor to take sex or marital status into account in connection with the evaluation of 
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credit-worthiness of any applicant; 
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(3) 
To make an inquiry of the applicant's age or of whether the applicant's 
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income derives from dole-outs or any public assistance program if such inquiry is for the 
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purpose of determining the amount and probable continuance of income levels, credit 
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history, or other pertinent element of credit-worthiness as provided in regulations of the 
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Board; 
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(4) 
To use any empirically derived credit system which considers age if such a 
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system is demonstrably and statistically sound in accordance with regulations of the 
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Board, except that in the operation of such system the age of an e1ederly applicant may 
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not be assigned a negative factor or value; or 
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(5) 
To make an inquiry or to consider the age of an elderly applicant when the 
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age of such applicant is to be used by the creditor in the extension of credit in favor of 
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such applicant. 
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SECTION 6. Additional Activities Not Constituting Discrimination. - It is not a 
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violation of this Act for a creditor to refuse to extend credit offered pursuant to -
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(1) 
Any credit assistance program expressly authorized by law for an 
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economically disadvantaged class of persons; 
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(2) 
Any credit assistance program administered by a profit organization for its 
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members or an economically disadvantaged class of persons; or 
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(3) 
Any special purpose credit program offered by a profit-making organization 
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to meet special social needs which meets standard prescribed in regulations by the Board 
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if such refusal is required by or made pursuant to such program. 
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SECTION 7. Reason/or Adverse Action; Procedure Applicable. 
2 
(I) 
Within 30 days (or such longer reasonable time as specified in regulations 
3 
of the Board for any class of credit transaction) after receipt of a completed application 
4 
for credit a creditor shall notify the applicant of its action on the application. 
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(2) 
Each applicant against whom adverse action is taken shall be entitled to a 
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statement of reasons for such action from the creditor. A creditor satisfies this obligation 
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by-
8 
(A) 
Providing statements of reasons in writing as a matter of course to 
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applicants against whom adverse action is taken; or 
10 
II 
12 
13 
14 
IS 
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(B) 
Giving written notification of adverse action which discloses 
1. 
The applicant's right to a statement of reasons within thirty 
(30) days after receipt by the creditor of a request made within 60 days after 
such notification, and 
11. 
The identity of the person or office from which such 
statement may be obtained. Such statement may be given orally if the 
written notification advises the applicant of his right to have the statement 
of reasons confirmed in writing on written request. 
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(3) 
A statement of reasons meets the requirements of this Section only if it 
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contains the specific reasons for the adverse action taken. 
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(4) 
Where a creditor has been requested by a third party to make specific 
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extension of credit directly to an applicant, the notification and statement of reasons 
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required by this subsection may be made directly by such creditor, or indirectly through 
23 
the third party, provided in either case that the identity of the creditor is disclosed 
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(5) 
The requirements of paragraph (B), (C) or (D) may be satisfied by verbal 
25 
statements or notifications in the case of any creditor who did not act on more than ISO 
4 


applications during the calendar year preceding the calendar year in which the adverse 
2 
action is taken, as determined under regulations of the Board. 
3 
SECTION 8. Promulgation of Regulation by Board; Establishment of Consumer 
4 
Advisory Council by Board; Duties, Membership, etc. of Council. -
5 
(1) 
The Board shall prescribe regulations to carry out the purposes of this Act. 
6 
These regulations may contain but are not limited to such classifications, differentiation, 
7 
or other provision, and may provide for such adjustments and exceptions for any class of 
8 
transactions, as in the judgment of the Board are necessary or proper to effectuate the 
9 
purposes of this Act, to prevent circumvention or evasion thereof, or to facilitate or 
10 
substantiate compliance therewith. In particular, such regulations may exempt from one 
II 
or more of the provisions of this Act any class of transactions not primarily for personal, 
12 
family, or household purposes, if the Board makes an express finding that the application 
13 
of such provision or provisions would not contribute substantially to carrying out the 
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purposes ofthis Act. 
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(2) 
The Board shall establish a Consumer Advisory Council to advise and 
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consult with it in the exercise of its functions and to advise and consult with it concerning 
17 
other consumer related matters it may place before the Council. In appointing the 
18 
members of the Council, the Council shall meet from time to time at the call of the 
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Board. Members of the Council who are not regular full-time employees of government, 
20 
national, or local, or any government-owned or controlled corporation, shall, while 
21 
attending meetings of such Council, be entitled to receive compensation at a rate fixed by 
22 
the Board, but not exceeding P300.00 per day, including travel time. Such members may 
23 
be allowed travel expenses, including transportation and subsistence, while away from 
24 
their homes or regular place of business. 
5 


SECTION 9. Administrative Enforcement. - Compliance with the requirements 
2 
imposed under this Act shall be enforced by: 
3 
(1) 
The Board, with respect to banks, including government banking 
4 
institutions, savings and loan associations, and other financial institutions or firms 
5 
engaged in the extension of credit; 
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(2) 
The Land Bank of the Philippines, with respect to agricultural credit union 
7 
cooperatives; and 
8 
(3) 
The Securities and Exchange Commission, with respect to brokers and 
9 
dealers. 
10 
The Board shall, however, exercise overall authority in the enforcement of the 
11 
requirements imposed under this Act. 
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SECTION 10. Rules and Regulations by Enforcing Agencies. - The authority of 
13 
the Board to issue regulations does not impair the authority of the other agencies 
14 
designated in Section 9 to make rules respecting their own procedures in enforcing 
15 
compliance with the requirements imposed under this Act. 
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SECTION 11. Civil Liability. -
17 
(1) 
Individual or Class Action for Actual Damages. - Any creditor who fails to 
18 
comply with any requirement imposed under this Act shall be liable to the aggrieved 
19 
applicant for my actual damages sustained by such applicant acting either in individual 
20 
capacity or as a member of a class. 
21 
(2) 
Recovery of Punitive Damages in Individual and Class Actions for Actual 
22 
Damages; Exemptions; Maximum Amount of Punitive Damages in Individual Actions; 
23 
Limitation on Total Recovery in Class Actions; Factors Determining Amount of Award -
24 
Any creditor, other than a government or governmental subdivision or agency, who fails 
25 
to comply with any requirement imposed under this Act shall be liable to the aggrieved 
6 


applicant for punitive damages in an amount not greater than ~10,OOO, in addition to any 
2 
actual damages provided in subsection (1) of this Section, except that in the case of a 
3 
class action the total recovery under this subsection shall not exceed the amount of 
4 
~lOO,OOO or one per centum of the net worth of the creditor. In determining the amount 
5 
of such damages in any action, the court shall consider, among other relevant factors, the 
6 
amount of any actual damages awarded, the frequency and persistence of failures of 
7 
compliance by the creditor, the resources of the creditor, the number of persons adversely 
8 
affected, and the extent to which the creditor's failure of compliance was intentional. 
9 
(3) 
Recovery of Costs and Attorney's Fees - In the case of any successful 
10 
action under subsection (a) or (b) of this Section, the costs of suit, together with a 
11 
reasonable attorney's fee as determined by the court, shall be added to any damages 
12 
awarded by the court under such subsection. 
13 
SECTION 12. Jurisdiction of Courts; Time for Maintenance of Action; 
14 
Exceptions. - Any action under this Act may be brought in the appropriate court using as 
15 
jurisdictional basis the amount in controversy. No such action shall be brought later than 
16 
two years from the date of the occurrence of the violations, except that-
17 
(1) 
Whenever any agency having responsibility for administrative enforcement 
18 
under Section 9 commences an enforcement proceeding within two (2) years from the 
19 
date of the occurrence of the violation; or 
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(2) 
Whenever the Solicitor General commences a civil action under this section 
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within two years from the date of the occurrence of the violation. 
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Any applicant who has been a victim of the discrimination which is the subject of 
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such proceeding or civil action may bring an action under this Section not later than one 
24 
year after the commencement of that proceeding or action. 
7 


SECTION 13. Request by Responsible Enforcement Agency to Solicitor General 
2 
for Civil Action -
3 
(1) 
The agencies having responsibility for administrative enforcement under 
4 
Section 9, if unable to obtain compliance with the requirements imposed under this Act, 
5 
are authorized to refer the matter to the Solicitor General with a recommendation that an 
6 
appropriate civil action be instituted. 
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(2) 
When a matter is referred to the Solicitor General pursuant to subsection (1) 
8 
of this Section, or whenever he has reason to believe that one or more creditors are 
9 
engaged in a pattern or practice in violation of this Act, the Solicitor General may bring a 
10 
civil action in a court of competent jurisdiction, including injunctive relief. 
11 
SECTION 14. Discovery of Creditor's Granting Standards. - Nothing in this Act 
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shall be construed to prohibit the discovery of a creditor's credit granting standards under 
13 
appropriate discovery procedures in the court in which an action or proceeding is 
14 
brought. 
15 
SECTION 15. Annual Reports to Congress; Contents - Each year, the Board shall 
16 
report to the Congress concerning the administration of its functions under this Act, 
17 
including such recommendations as it may deem necessary or appropriate. In addition, 
18 
the report of the Board shall include its assessment of the extent to which compliance 
19 
with the requirements of this Act is being achieved, and a summary of the enforcement 
20 
actions taken by each of the agencies assigned administrative responsibilities under 
21 
Section 9 of this Act. 
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SECTION 16. Separability Clause. -If any provision ofthis Act is held invalid or 
23 
unconstitutional, the same shall not affect the validity and effectivity of the other 
24 
provisions hereof. 
8 


SECTION 17. Repealing Clause. - All laws, decrees, orders, and issuances, or 
2 
portions thereof, which are inconsistent with the provisions of this Act, are hereby 
3 
repealed, amended or modified accordingly. 
4 
SECTION 18. Effectivity Clause. - This Act shall take effect fifteen (15) days 
5 
after its publication in the Official Gazette or in two (2) newspapers of general 
6 
circulation. 
Approved, 
Itmdp90ct20 15 
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