THIRTEENTH CONGRESS OF THE REPUBLIC) 
OF THE PHILIPPINES 
First Regular Session 
’Ed 
JJL 16 PA, 5 3  
SENATE 
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S.B. No. 
1448 
i i\;f33 
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Introduced by Senator Miriam Defensor Santiago 
EXPLANATORY NOTE 
There is abundant evidence of the widespread use of abusive, deceptive, and 
unfair debt collection practices by many creditors and debt collectors. Abusive debt 
collection practices have contributed to a number of unwarranted personal banlmptcies, 
to marital instability, to loss ofjobs, and to invasions of individual privacy. Existing laws 
for redressing these injuries are inadequate to protect borrouers. Only article 287 of the 
Revised Penal Code is the law which affords protection to debtor, albeit indirectly. 
The purpose of this bill is to eliminate abusive debt collection practices by 
creditom and debt E6llectors for the following reasons. 
First, means, other than misrepresentation or other abusive debt collection 
practices are available for the effective collection of debts; 
Second, to ensure that those creditors and debt collectors 
abusive debt collection practices are not competitively disadvantage; and 
Third, to provide an adequate legal remedy to consumers against abusive debt 
collection practices. 


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THIRTEENTH CONGRESS OF THE REPUBLIC) 
OF THE PHILIPPINES 
First Regular Session 
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’rid 
-j.. 16 p 4  153 
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extent that he receives an assignment or transfer of a debt in default solely for the 
of facilitating collection of such debt for another. 
Introduced by Senator Miriam Defensor Santiago 
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purpose 
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FAIR DEBT COLLECTION PRACTICES ACT 
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congvess assembled: 
Section 1. Short Tide. - This Act shall be known as the “Fair Debt Collection 
Practices Act.” 
Section 2. Declaration of Policy. - It is hereby declared a State policy to eliminate 
abusive debt collection practices and to protect consumers in general against debt 
collection abuses. 


creditor, collecting debts for such creditor; 
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party in commercial credit transaction involving the creditor. 


f. 
The term location information means a consumer’s place of abode and his 
telephone number, if any, at such place, or his place of employment. 
requested to do so by such person or unless the debt collector reasonably believes 
Section 5. Communication 
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in Collection with Debt Collection. 
(a) Communication with consumer generally - Without the prior consent of the 
consumer given directly to the debt collector or the express permission of a court of 
competent jurisdiction, a debt collector may not communicate with a consumer in 
connection with the collection of any debt -- 
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receiving such communication. 


(3) 
where applicable, to notify the consumer that the debt collector or 
creditor intends to invoke the a specified remedy. 
If such notice from the consumer is made by mail, notification shall be 
complete upon receipt. 
Section 6. Hurussment or Abuse. - A debt collector may not engage in any 
conduct the natural consequence of which is to harass, oppress, or abuse any person in 
connection with the collection of a debt. Without limiting the general application of the 
foregoing and without prejudice to the application of pertinent provisions of the Re ised 
Penal Code and other laws, the following conduct is a violation of this section: 
(1) The use or threat of use of violence or other criminal means to h 
the 
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physiczperson, reputation, or property of any reason. 
(2) The use of obscene or profane language or language the natural conseq ence 
of which is to abuse the hearer or reader. 
(3) The publication of a list of consumers who allegedly refuse to pay debts. 
(4) The advertisement for sale of any debt to coerce payment of the debt. , 
Section I .  False or misleading representations. - A debt collector ma not use 
any false, deceptive, or misleading representation or means in connection with the 
collection of any debt. Without limiting the general application of the foregoing and 
without prejudice to the application of pertinent provisions of the Revised Penal Code 
and other laws, the following conduct is a violation of this section: 
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(1) The unauthorized use of any badge, uniform, or facsimile thereof. 
(2) The false representation of --- 
(a) The character, amount, or legal status of any debt; or 
(b) Any services rendered or compensation which may be lawfully 
received by any debt collector for the collection of the debt. 
The false representation or implication that any individual is an 
(3) 
attorney or that any communication i s  from an attorney. 


attempt to collect any debt or to obtain information concerning a consumer. 
(1 1) 
Except as otherwise provided for communications, to acquire 


Section 8. Unfair Practices. - A debt collector may 
not 
use unfair 
or 
unconscionable means to collect or attempt to collect any debt. Without lim ting the 
general application of the foregoing and without prejudice to the provisions of the New 
1, 
Civil Code, Revised Penal Code, and other laws, the following conduct is a vi0 1 ation of 
this section: 
(I) The collection of any amount (including any interest, fee, charge, or expense 
incidental to the principal obligation) unless such amount is expressly authorized by the 
agreement creating the debt or permitted by law. 
(2) The acceptance by a debt collector from any person of a check or other 
payment instrument postdated by more than five days unless such person is notified in 
writing of the debt collector’s intent to deposit such check or instrument not more than 
10 nor less than three (3) business days prior to such deposit. 
(3) The solicitation by a debt collector of any postdated check or other postdated 
payment instrument for the purpose of threatening or instituting criminal prosecution. 
(4) Depositing or threatening to deposit any postdated check or other postdated 
instrumgt prior to-the date on such check or instrument. 
(5) Causing charges to be made to any person for communications by 
concealment of the true purpose of the communication. Such charges include, but are not 
limited to, collect telephone calls and telegram fees. 
(6) Taking or threatening to take any non-judicial action to effect dispossession or 
disablement of property if --- 
(a) there is no present right to possession of the property claimed as 
collateral through an enforceable security interest; 
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(b) there is no present intention to take possession of the property; or 
(c) the property is exempt by law from such dispossession or disablement. 
(7) Using any language or symbol, other than the debt collector’s address, on any 
envelope when communicating with a consumer by use of the mails or by telegram, 


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except that a debt collector may use his name if such name does not indicate that he is in 
the debt collection business. 
Section 9. 
(a) Validation of Debts; Notice of Debt; Contents. - Within five 
days after the initial communication with a consumer in connection with the coll ction of 
any debt, a debt collector shall, unless the following information is contained in t e initial 
communication or the consumer has paid the debt, send the consumer a written notice 
containing 
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(1) the amount of the debt; 
(2) the name of the creditor to whom the debt is owed; 
(3) a statement that unless the consumer, within thirty days after the 
receipt of the notice, disputes the validity of the debt, or any portion 
thereof, the debt will be assumed to be valid by the debt collector. 
(4) a statement that if the consumer notifies the debt collector in writing 
within the thirty-day period that the debt, or any protion thereof, is 
disputed the debt collector will obtain verification of the debt or a copy 
of a judgment against the consumer and a copy of such verification or 
judgment will be mailed to the consumer by the debt collector; and 
(5) a statement that, upon the consumer's written request within the thirty- 
&y period, the debt collector will provide the consumer with the name 
and address of the original creditor, if different from the current 
creditor. 
(b) Disputed debts. If the consumer notifies the debt collector in writing within 
the thirty-day period described in subsection (a) of this section that the debt, or any 
portion thereof, is disputed, or that the consumer requests the name and addre s of the 
original creditor, the debt collector shall cease collection of the debt, or any I 
disputed 
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portion thereof, until the debt collector obtains verification of the debt or a copy of a 
judgment, or the name and address of the original creditor, is mailed to the consumer by 
the debt collector. 


(c) Admission of liability. The failure of a consumer to dispute the validity of a 
debt under this section may not be construed by any court as an admission of liability by 
the consumer. 
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failure to comply with a provision of this Act. 
Section 10. Multiple Debts. - If any consumer owes multiple debts and makes any 
single payment to any debt collector with respect to such debts, such debt collector may 
not apply such payment to any debt which is disputed by the consumer and, where 
applicable, shall apply such payment in accordance with the consumer’s direction.. r 
Section 11. 
Legal Actions by Debt Collectors. - Any debt collector w o brings 
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any legal action on a debt against any consumer shall --- 
(1) in the case of an action to enforce ,an interest in real property securing 
the consumer’s obligation, bring such action only in the place where the property 
or any part thereof lies; or 
(2) in the case of an ,action not described in paragraph (I), bring such 
action only 
(a) in the place of the execution of the contract sued upon; or 
(b) in which such consumer resides at the commencement of the 
action. 


Section 13. Civil liability. - (a) Amount of damages. - Except as otherwise 
provided by this section, any debt collector who fails to comply with any provision of this 
Act with respect to any person is liable to such person in an amount equal to the sum of - 
(1) Any actual damage sustained by such person as a resiilt of such failure; 
(2) (A) In the case of any action by an individual, such additional 
dmages as the court may allow, but not exceeding P 20,000.00; or 
(Bj In the case of a class action, (i) such amount for each named 
plaintiff as could be recovered under sub paragraph (A), and such 
amount as the court may allow for all other class members, without 
regard to a minimum individual recovery, not to exceed the lesser of 
P50,OOO.OO or 1 per centum of the net worth of 
(b) Factors considered by the court. - In determining the amount of 
action under sub-section (a) of this section, the court shall consider, 
factors --- 
(1) in any individual action under subsection (a)(2)(A) of this section, the 
frequency and persistence of non-compliance by the debt collector, the nature of 
such non-compliance, and the extent to which such non-compliance was 
intentional; or 
(2) in any class action under subsection (a)(2)(B) of this section, the 
frequency and persistence of non-compliance by the debt collector, the nature of 
such non-compliance, the resonrces of the debt collector, the number of persons 
adversely affected, and the extent to which the debt collector's non-compliance 
was intentional. 
(c) 
Intent. A debt collector may not he held liable in any action brought under 
this section if the debt collector shows by a preponderance of evidence that the violation 
was not intentional and resulted from a bona fide error notwithstanding the maintenance 
of procedures reasonably adopted to avoid any such error. 
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(d) 
Jurisdiction. An action to enforce any liability created by this Act may be 
brought in any appropriate court using as jurisdictional basis the amount of debt involved. 
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Section 14. Separability Clause. - If any provision or part thereof, is held invalid 
or unconstitutional, the reminder of the law of the provision not otherwise affected shall 
remain valid and subsisting. 
Section 15. 
Repealing Clause. 
Any law, presidential decree or issuance, 
executive order, letter of instruction, administrative order, rule or regulation contrary to, 
or inconsistent withr the provisions of this Act is hereby repealed, modified or amended 
accordingly. 
Section 16. 
Effectivity Clause. 
This Act shall take effect fifteen (15) days 
after its publication in at least two (2) newspaper of general circulation. 
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Approved. 
FN: 296 
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