FIFTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES —_)
FIRST REGULAR SESSION )

HOUSE OF REPRESENTATIVES

Introduced by Representative Rufus B. Rodriguez and
Representative Maximo B. Rodriguez, Jr.

House Bill No. 2647

EXPLANATORY NOTE

The number of financial institutions offering international money transfer
services has recently doubled in view of intensified international business
transactions of late and increased remittances sent by Filipinos working abroad.

Given these developments, however, many financial institutions take
advantage of their clients by not disclosing certain crucial information to
consumers before the transaction consummation; hence, denying certain benefits
which should accrue them.

There is a need to set in place appropriate disclosure mechanism. Any
financial institution or money transmitting business which initiates an international
money transfer on behalf of a consumer (whether or not the consumer maintains
an account at such institution or business) should therefore be required to make a
g00d faith effort to provide the following disclosures to the consumer before the
consummation of the transaction:

(a) any fees to be charged to the recipient, including exchange rate or
‘currency conversion fees;

(b) a final itemization of all costs to the consumer, which would include all
fees charged, for the remittance; and

(c) the exact amount of foreign currency to be received by the recipient in
the foreign country.

This proposed measure seeks to institutionalize disclosure practice in the
international money transfer to facilitate transparent and cost-effective transaction.

Immediate approval of this bill is earnestly sought



FIFTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES —)
FIRST REGULAR SESSION )

HOUSE OF REPRESENTATIVES

introduced by Representative Rufus B. Rodriguez and
Representative Maximo B. Rodriguez, Jr.

House Bill No. 2647

AN ACT
TO REQUIRE CERTAIN DISCLOSURES IN CONNECTION WITH ANY
INTERNATIONAL MONEY TRANSFER AND FOR OTHER PURPOSES

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

SECTION 1. Short Title. — This Act shall be known as the “International
Money Transfer Disclosure Act.

SEC 2. Disclosures Required. —

(1) General Regulations — Subject to paragraph (2), any financial institution or
money transmitting business which initiates an international money
transfer on behalf of a consumer (whether or not the consumer maintains
an account at such institution or business) shall make a good faith effort to
provide the following disclosures to the consumer before the
consummation of the transaction:

a. Any fees to be charged to the recipient, including any exchange rate
or currency conversion fees;

b. A final itemization of all costs to the consumer, which would include
all fees charged, for the remittance;

. The exact amount of foreign currency to be received by the recipient
in the foreign country.

2)

Good Faith Effort - For purposes of paragraph (1), good faith effort
requires honesty in fact and all commercially reasonable efforts to provide
the disclosures based on the most accurate information reasonably
available to the financial institution or money transmitting business at the
time of the intemational money transfer.


(3) Language Requirement — The disclosures required under subsection (a)
shall be in English and in the same language, if other than English, as the
language principally used by the financial institution or money transmitting
business, or any of its agents, to advertise, solicit, or negotiate, either
orally or in writing, at the office of the institution or business at which the
international money transfer is initiated.

SEC 3. Definition. - For purposes of this Section, the following definitions
shall apply -

1. Intemational Money Transfer — The term ‘intemational money transfer
means any money transmitting service originating in the Philippines and
involving an international transaction which is provided by a financial
institution or a money transmitting business.

2. Money Transmitting Business — The term ‘money transmitting business’
means any business which:

a. provides check cashing, currency exchange, or money
transmitting or remittance services, or issues or redeems money
orders, travelers’ checks, and other similar instruments; and,

b. is not a depository institution as defined by appropriate laws.

SEC 4. Penalty. - Any financial institution that violates the disclosure
requirements set forth in this Act shall be made to pay a fine of not less than
50,000.00 plus suspension of operations for a period not exceeding six (6)
months. Second violation may cause revocation of necessary licenses,
depending on the gravity of the offense as determined by court acquiring
jurisdiction over the same.

SEC 5. Separability Clause. — if any provision or part hereof, is held invalid
of unconstitutional, the remainder of the law or the provision not otherwise
affected shall remain valid and subsisting.

SEC 6. Repealing Clause. - Any law, presidential decree or issuance,
executive order, letter of instruction, administrative order, rule or regulation
contrary to or inconsistent with the provisions of this Act is hereby repealed,
modified or amended accordingly

SEC 7. Effectivity. - This Act shall take effect fifteen (15) days after its
Publication in at least two (2) newspapers of general circulation

Approved