Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
NINETEENTH CONGRESS 
First Regular Session 
HOUSE BILL NO. ____
Introduced by HON. LUIS RAYMUND “LRAY” F. VILLAFUERTE, JR.,  
HON. MIGUEL LUIS R. VILLAFUERTE, HON. TSUYOSHI ANTHONY G. 
HORIBATA AND HON. NICOLAS ENCISO VIII 
EXPLANATORY NOTE 
The state shall maintain honesty and integrity in the public service and take positive and 
effective measures against graft and corruption. At present, farmers and workers can obtain 
credit by assigning goods in a warehouse and using the warehouse receipt as a collateral for 
the loan.  
The law prescribes the rights and duties of a warehouseman, regulates the legal 
relationship between the warehouseman and the holder of a warehouse receipt. It also notes 
the negotiability of the warehouse receipts and protects the holder in due course who acquired 
the instrument in good faith and for value. 
This bill seeks to strengthen and modernize the Warehouse Receipts Law of 1992, as 
amended otherwise known as “Act No. 2137”. The amendment is a response to the needs of 
our agricultural sector. Modern and technological advances should be utilized to establish a 
system that is more secure and transparent. 
This bill establishes a central electronic registry for all warehouse receipts. This data 
should be integrated with other existing registries. With the use of a reliable and secure central 
registry system, banks and other financial institutions will be willing to accept the warehouse 
receipts as collateral for loans. 
The proposed measure will enable the agricultural sector to acquire credit in exchange 
of goods. This will facilitate economic activity by giving access to entities engaged in farming 
and the agricultural sector as a whole. 
In view of the forgoing, the passage of the bill is earnestly sought. 
LUIS RAYMUND “LRAY” F. VILLAFUERTE, JR. 
 MIGUEL LUIS R. VILLAFUERTE 
TSUYOSHI ANTHONY G. HORIBATA 
NICOLAS ENCISO VII 
July 14, 2022
1:45 pm
1938


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Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City 
NINETEENTH CONGRESS 
First Regular Session 
HOUSE BILL NO. ____
Introduced by HON. LUIS RAYMUND “LRAY” F. VILLAFUERTE, JR.,  
HON. MIGUEL LUIS R. VILLAFUERTE, HON. TSUYOSHI ANTHONY G. 
HORIBATA AND HON. NICOLAS ENCISO VIII 
AN ACT  
PROVIDING FOR THE REVISED WAREHOUSE RECEIPTS LAW OF THE 
PHILIPPINES 
Be it enacted by the Senate and House of Representatives of the Philippines 
in Congress assembled: 
CHAPTER I 
GENERAL PROVISIONS 
SECTION 1. Short Title. — This Act shall be known as the "Revised 
Warehouse Receipts Law of the Philippines". 
SEC. 2. Declaration of Policy. — It is the policy of the State to promote 
economic activity by increasing access, particularly for entities engaged in agricultural 
businesses, such as farming, to least cost credit by establishing a simplified, unified, 
and modern framework for the storage of goods in warehouses and the subsequent 
trading of interests therein. 
SEC. 3. Definition of Terms. As used in this Act: 
(a) Action refers to a counterclaim, set-off, or suit in equity as provided by law;
(b) Delivery refers to the voluntary transfer of control from one person to
another; 
(c) Deposit refers to the act of transferring actual possession of goods to a
warehouse operator; 
 1938


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(d) Electronic warehouse receipt refers to a warehouse receipt in electronic
or digital form; 
(e) Goods refer to chattel or merchandise in storage or which have been or are
about to be stored; 
(f) Good faith refers to an abstract or comprehensive term that encompasses
a sincere belief or motive without any malice or the desire to defraud others, 
whether it be done negligently or not; 
(g) Guarantee refers to a guarantee specifically issued by the Philippine
Guarantee Corporation; 
(h) Holder of a receipt refers to a person who has both constructive
possession of such receipt and a right of property therein; 
(i) Insurance refers to any form of insurance, whether obtained from a public
or private entity, within the meaning of the Insurance Code of the Philippines; 
(j) Modern refers to the adaptation and utilization of modern technology,
including Blockchain technology; 
(k) Negotiable receipt refers to a receipt in which it is stated that the goods
received will be delivered to the bearer or to the order of any person named in 
such receipt; 
(l) Non-Negotiable Receipt refers to a receipt in which it is stated that the
goods received will be delivered to the depositor or to any other specified 
person;  
(m) Order refers to an order by indorsement on the receipt;
(n) Owner refers to one who has the right of possession of a warehouse receipt
but does not include a mortgagee; 
(o) Person refers to both natural and juridical persons;
(p) Purchase refers to the act of acquiring a warehouse receipt in the form Of
mortgage or pledge; 
(q) Registry refers to the Electronic Warehouse Receipts Registry;
(r) Release order refers to a written instrument issued by the owner of a receipt
directing a warehouse operator to release his goods to a specific person; 
(s) Value refers to any consideration sufficient to support a simple contract. An
antecedent or pre-existing obligation, whether for money or not, constitutes 
value where a receipt is taken either in satisfaction thereof or as security 
therefor; 


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(t) Warehouse refers to a place that houses goods intended to be used for
trading or financing within the territory of the Philippines operated and 
maintained by a warehouse operator; 
(u) Warehouse operator refers to a person lawfully engaged in the business
of housing goods intended to be used for trading or financing and duly 
authorized under this Act; 
(v) Warehouse receipt or receipt refers to a document issued by a warehouse
operator in accordance with Section 5 of this Act; and 
(w) Writing refers to written documents or records, including electronic records.
SEC. 4. Person Who May Issue Receipts. — Warehouse receipts may only 
be issued by a duly accredited warehouse operator. 
SEC. 5. Form of Receipts. — Every warehouse receipt must contain the 
following information: 
(a) Location of the warehouse where the goods are stored;
(b) Date of the issue of the receipt;
(c) Consecutive number of the receipt;
(d) Statement whether the goods received will be delivered to the bearer, to a
specified person, or to a specified person or order; 
(e) Amount up to which the goods covered by the receipt are insured, and the
name of the insuring entity; 
(f) Rate of storage charges;
(g) Description of the goods or of the packages containing them;
(h) Signature of the warehouse operator, which may be made by an authorized
agent; 
(i) Fact of ownership if the receipt is issued for goods of which the warehouse
operator is owner, either solely, jointly, or in common with others; and 
(j) Statement of the amount of advances made and of liabilities incurred for
which the warehouse operator claims a lien. If the precise amount of such 
advances made or of such liabilities incurred is, at the time of the issue of 
receipt, unknown to the warehouse operator or to the agent who issues it, a 
statement of the fact that advances have been made or liabilities incurred and 
the purpose thereof is sufficient. 


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A warehouse operator shall be liable to any person injured thereby for all 
damages caused by the omission from a warehouse receipt of any of the terms herein 
required. 
SEC. 6. Permissible Insertions. — A warehouse operator may insert in a 
receipt any other terms and conditions: Provided, That such terms and conditions shall 
not: 
(a) Be contrary to the provisions of this Act; or
(b) In any way impair the obligation to exercise that degree of care in the
safekeeping of the goods entrusted which a reasonably careful person would 
exercise in regard to similar goods one owns. 
No provision shall be inserted in a negotiable receipt that it is non5 negotiable. 
Such a provision, if inserted, shall be void. 
SEC. 7. Failure to Mark "Non-Negotiable" or "Not Negotiable". – warehouse 
operator shall clearly indicate or mark on the face of a non-negotiable receipt that it is 
"non-negotiable" or "not negotiable". In the absence of such marking, the receipt shall 
be deemed negotiable. 
This section shall not apply, however, to letters, memoranda, or written 
acknowledgment of an informal character. 
CHAPTER Il 
ELECTRONIC WAREHOUSE RECEIPTS REGISTRY 
SEC. 8. Electronic Warehouse Receipts Registry. The Securities and 
Exchange Commission (SEC) is hereby tasked with creating and maintaining a 
modern, online, centralized, and nationwide Registry where all electronic warehouse 
receipts can be registered and accessed, as well as rules and regulations pertaining 
specifically to registration and cancellation of electronic warehouse receipts. The SEC 
is likewise authorized to engage the services of third parties in creating and 
maintaining the Registry. 


 
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SEC. 9. Local Sub-Registry. — In addition to the Registry created and 
maintained by the SEC, all warehouses must establish and maintain a Sub-Registry 
specifically for goods deposited therein. Failure of a warehouse to keep a Sub Registry 
in the warehouse, as well as any fraud committed thereon, shall be grounds for the 
revocation of a warehouse's accreditation. 
 
SEC. 10. Transferability of Receipts. — All warehouse receipts, regardless 
of what is stated upon their face, are transferable at the option of the holder. 
 
SEC. 11. Collateralization of Receipts. — All warehouse receipts, regardless 
of what is stated upon their face, may be collateralized in accordance with Republic 
Act NO. 11057, otherwise known as the Personal Property Security Act. 
 
SEC. 12. Guarantee on All Warehouse Receipts Securing Financial 
Obligations. — Upon the establishment and operationalization of the Registry, the 
Philippine Guarantee Corporation (PhilGuarantee), in accordance with its 
consolidated mandate under Executive Order No. 58, Series of 2018, and to the extent 
allowed by the provisions of applicable laws, may provide guarantee on eligible loans 
secured by warehouse receipts or the goods evidenced thereby. 
 
CHAPTER Ill 
ACCREDITATION 
SEC. 13. Role of the SEC. — The SEC shall be the primary regulatory body in 
charge of all matters related to warehouse receipts, including accreditation of 
warehouse operators and warehouses. While the SEC may consult with Other 
regulatory bodies including the Department of Trade and Industry, the Department of 
Finance, and the Department of Agriculture, warehousing experts, and other 
organizations that are representatives of a particular sector, the SEC shall, at all times, 
be the lead agency in ensuring the successful implementation of this Act: Provided, 
That the regulatory bodies, warehousing experts, and other organization 
representative of a particular sector shall only be consulted on goods, crops, and 
practices they are familiar with. 
 


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SEC. 14. Warehousing Experts. — The SEC is authorized to issue rules and 
regulations in order to determine who shall qualify as warehousing experts. 
Warehousing experts must be persons knowledgeable and with actual experience in 
operating and maintaining warehouses in accordance with globally accepted best 
practices in warehousing. 
SEC. 15. Functions and Responsibilities of the SEC as Accrediting 
Agency. As the accrediting entity, the SEC shall have the following functions and 24 
responsibilities: 
(a) Institute and operationalize a system of accreditation for warehouse
operators: Provided, That the criteria for accreditation shall include sound and 
measurable standards relating to the ability and capacity to handle the storage 
of goods and the maintenance of the Sub-Registry; 
(b) Issue a certificate of accreditation to qualified warehouse operators and
warehouses upon determination that the requirements and criteria set for this 
purpose have been fully satisfied: Provided, That the certificate of accreditation 
shall be valid only for such period as may be prescribed under the implementing 
rules and regulations of this Act; 
(c) Monitor the performance of warehouse operators to ensure continuing
compliance with the provisions of this Act and its implementing rules and 
regulations; 
(d) Suspend or revoke any certificate of accreditation upon due determination
that a warehouse operator no longer meets the criteria for accreditation; 
(e) Require regular submission of reports by warehouse operators;
(f) Collect reasonable accreditation and monitoring fees from warehouse
operators which shall be used for operational requirements; 
(g) Submit an annual report to the President of the Philippines and the
concerned committees of both Houses of Congress of the Philippines; and 
(h) Perform such other functions as may be necessary to accomplish the
purposes and objectives of this Act in relation to warehouse operators and 
warehouses. 
SEC. 16. Accreditation of Warehouse Operators. — All warehouse operators 
issuing warehouse receipts to be used for purposes other than mere storage and 


 
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facilitation of logistics are hereby required to seek the accreditation of the SEC. The 
SEC shall create rules and regulations to facilitate the accreditation of warehouse 
operators. All warehouse operators who are not accredited with the SEC are prohibited 
from issuing warehouse receipts. 
 
SEC. 17. Screening Process for Warehouse Operators. — To ensure the 
credibility and integrity of warehouse operators, the SEC is hereby authorized to create 
a screening process for warehouse operators, which may include the administration 
of written examinations. The SEC shall coordinate with other governmental bodies in 
order to create a viable screening process for warehouse operators. 
 
SEC. 18. Warehouse Operator's Bond. — Prior to the operation of the 
warehouse, a warehouse operator must post a bond to answer for any liabilities the 
warehouse operator may have in the operation of the warehouse during the effectivity 
of its accreditation. The SEC is hereby ordered and authorized to come up with rules 
and regulations concerning the warehouse operator's bond, 
 
SEC. 19. Mandatory Insurance. — A warehouse operator shall produce 
insurance coverage for his, her or its business and the warehouse or warehouses the 
warehouse operator shall operate. No warehouse operator shall be accredited by the 
SEC unless the warehouse operator is able to comply with this requirement. The SEC 
shall issue the appropriate guidelines for the mandatory insurance coverage 
requirement which shall include the minimum insurance requirements for warehouses 
and warehouse operators: Provided, That the minimum insurance requirements are in 
accordance with globally accepted best practices for warehouse and warehouse 
operators. 
 
SEC. 20. Effect of Lapse or Absence of Insurance. — The SEC may revoke 
the accreditation of any warehouse operator that is found to be operating without 
appropriate insurance coverage or with lapsed insurance policy, or whose warehouses 
are found to be operating without a current insurance coverage. 
CHAPTER IV 
OBLIGATIONS AND RIGHTS OF WAREHOUSE OPERATORS 
UPON THEIR RECEIPTS 


 
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SEC. 21. Obligation of a Warehouse Operator to Deliver Goods. — A 
warehouse operator, in the absence of a lawful defense provided by this Act, is bound 
to deliver the goods upon a demand made either by the holder of a receipt for the 
goods or by the depositor if such demand is accompanied with: 
(a) An offer to satisfy the warehouse operator's lien, if applicable; 
(b) A written offer to surrender control of the receipt and perform all actions 
necessary to surrender said control; and 
(c) A readiness and willingness to sign an acknowledgement that the goods 
have been delivered, if such signature is requested by the warehouse operator. 
 
In case the warehouse operator refuses or fails to deliver the goods in 
compliance with a demand by the holder or depositor, the burden shall be upon the 
warehouse operator to establish the existence of a lawful defense for such refusal. 
 
SEC. 22. Justification of Warehouse Operator in Delivering Goods. — A 
warehouse operator is justified in delivering the goods to one who is: 
(a) The person lawfully entitled to the possession of the goods, or one's agent; 
(b) A person who is either entitled to delivery by the terms of a non-negotiable 
receipt issued for the goods, or who has written authority from the person so 
entitled; or 
(c) A person in control of a negotiable receipt by the terms of which the goods 
are deliverable, indorsed to, or in blank by the person to whom delivery was 
promised by the terms of the receipt or by the immediate indorser. 
 
SEC. 23. Warehouse Operator's Liability for Misdelivery of Goods. — 
Where a warehouse operator delivers the goods to one who is not lawfully entitled to 
the possession of them, the warehouse operator shall be liable to all persons having 
a right of the property or possession of the goods, unless the warehouse operator had: 
(a) been requested by, or on behalf of the person lawfully entitled to a right of property 
or possession of goods, not to make such delivery; or (b) received verified information 
that the delivery about to be made was to one who is not lawfully entitled to the 
possession of the goods. 
 
SEC. 24. Negotiable Receipt Must be Cancelled for Complete Delivery of 


 
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Goods. — Except as otherwise provided in this Act, a warehouse operator must 
cancel a negotiable receipt once the goods are completely delivered. Failing to do so, 
the warehouse operator shall be liable to any person who purchases in good faith such 
receipt for failure to deliver the goods to the purchaser, whether the purchaser 
acquired title to the receipt before or after the delivery of the goods by the warehouse 
operator. 
 
SEC. 25. Negotiable Receipts Must be Marked for Partial Delivery of 
Goods. — Except as otherwise provided in this Act, a warehouse operator must mark 
a negotiable receipt when only a part of the goods are delivered. Failing to do so, the 
warehouse operator shall be liable to anyone Who purchases in good faith such 
receipt, whether such purchaser acquired title to the receipt before or after the delivery 
of any portion of the goods by the warehouse operator. 
 
SEC. 26. Altered Receipts. — The alteration of a receipt shall not excuse the 
warehouse operator who issued it from any liability if such alteration was: 
(a) Immaterial; 
(b) Authorized; or 
(c) Made without fraudulent intent. 
 
If the alteration was authorized, the warehouse operator shall be liable 
according to the terms of the receipt as altered. If the alteration was unauthorized but 
made without fraudulent intent, the warehouse operator shall be liable according to 
the terms of the receipt as they were before alteration. 
  
Material and fraudulent alteration of a receipt shall not excuse the warehouse 
operator who issued it from liability to deliver, according to the terms of the receipt as 
originally issued, the goods for which it was issued: Provided, however, That the 
warehouse operator shall be excused from any other liability. 
 
SEC. 27. Warehouse Operator Cannot Have Title or Right to the 
Possession of Goods. — A warehouse operator shall have no title or right to the 
possession of goods, unless such title or right is derived directly or indirectly from a 
transfer made by the depositor at the time of, or subsequent to, the deposit for storage, 


 
11
or from the warehouse operator's lien. A warehouse operator cannot be excused from 
liability for refusing to deliver the goods according to the terms of the receipt. 
 
SEC. 28. Interpleader of Adverse Claimants. — If more than one person 
claims the title or possession of the goods, the warehouse operator may, either as a 
defense to an action brought against him, her or it for non-delivery of the goods or as 
an original suit, whichever is appropriate, require all known claimants to interplead. 
 
SEC. 29. Warehouse Operator Has Reasonable Time to Determine Validity 
of Claims. — If a person other than the depositor or person claiming under him, her 
or it has a claim to the title or possession of goods, and the warehouse operator has 
information of such claim, the warehouse operator shall be excused from liability for 
refusing to deliver the goods, either to the depositor or person claiming under him, her 
or it to the adverse claimant until the warehouse operator has had a reasonable time 
to ascertain the validity of the adverse claim or to bring legal proceedings to compel 
claimants to interplead. 
 
SEC. 30. Adverse Title is No Defense Except as Provided in This Act. — 
Except as provided in this Act, no right or title of a third person shall be a defense to 
an action brought by the depositor or person claiming under him, her or it against the 
warehouse operator for failure to deliver the goods according to the terms of the 
receipt. 
 
SEC. 31. Liability for Nonexistence or Misdescription of Goods — A 
warehouse operator shall be liable to the holder of a receipt for damages caused by 
the nonexistence of the goods or by the failure of the goods to correspond with the 
description thereof in the receipt at the time of its issue. If, however, the goods are 
described in a receipt merely by a statement of marks or labels upon them or upon 
packages containing them or by a statement that the goods are said to be goods of a 
certain kind or that the packages containing the goods are said to contain goods of a 
certain kind or by words of like purport, such statements, if true, shall not make liable 
the warehouse operator issuing the receipt, although the goods are not of the kind 
which the marks or labels upon them indicate or of the kind they were said to be by 
the depositor. 


 
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SEC. 32. Liability for Care of Goods. — A warehouse operator shall be liable 
for any loss or injury to the goods caused by his, her or its failure to exercise such care 
in regard to them as reasonably vigilant owner of similar goods would exercise, but 
the warehouse operator shall not be liable, in the absence of an agreement to the 
contrary, for any loss or injury to the goods which could not have been avoided by the 
exercise of such care. 
 
SEC. 33. Goods Must be Kept Separate. — Except as provided in the 
following section, a warehouse operator shall keep the goods so far separate from 
goods of other depositors and from other goods of the same depositor for which a 
separate receipt has been issued, as to permit at all times the identification and 
redelivery of the goods deposited. 
 
SEC. 34. Fungible Goods May Be Commingled if Warehouse Operator 
Authorized. — If authorized by agreement or by custom, a warehouse operator may 
mingle fungible goods with other goods of the same kind and grade. In such case, the 
various depositors of the mingled goods shall own the entire mass in common and 
each depositor shall be entitled to such portion thereof as the amount deposited by 
him, her or it bears to the whole. 
 
SEC. 35. Liability of Warehouse Operator to Depositors of Commingled 
Goods. — The warehouse operator shall be severally liable to each depositor for the 
care and redelivery of his, her or its share of such mass to the same extent and under 
the same circumstances as if the goods had been kept separate. 
 
SEC. 36. Attachment or Levy upon Goods for which a Negotiable Receipt 
Has Been Issued. — If goods are delivered to a warehouse operator by the owner or 
by a person whose act in conveying the title to them to a purchaser in good faith for 
value would bind the owner, and a negotiable receipt is issued for them, they cannot 
thereafter, while in the possession of the warehouse operator, be attached by 
garnishment or otherwise, or be levied upon under an execution unless the receipt be 
first surrendered to the warehouse operator or its negotiation enjoined. The warehouse 


 
13
operator shall, in no case, be compelled to deliver the actual possession of the goods 
until the receipt is surrendered to the warehouse operator or impounded by the court. 
 
SEC. 37. Creditor's Remedies to Reach Negotiable Receipts. — A creditor 
whose debtor is the owner of a negotiable receipt shall be entitled to such aid from 
courts of appropriate jurisdiction, by injunction and otherwise, in attaching such receipt 
or in satisfying the claim by means thereof as is allowed by law or in equity within the 
jurisdiction of the Philippines in regard to property which cannot readily be attached or 
levied upon by ordinary legal process. 
 
SEC. 38. What Claims Are Included in the Warehouse Operator's Lien. — 
Subject to the provisions of this Act, a warehouse operator shall have a lien on goods 
deposited or on the proceeds thereof in his, her or its hand; for all lawful charges for 
storage and preservation of the goods; for all lawful claims for money advanced, 
interest, insurance, transportation, labor, weighing, coopering and other charges and 
expenses in relation to such goods; for all reasonable charges and expenses for 
notice, and advertisements of sale; and for sale of the goods where default had been 
made in satisfying the warehouse operator's lien. 
 
SEC. 39. Against What Property the Warehouse Operator's Lien May be 
Enforced. — Subject to the provisions of this Act, a warehouse operator's lien may be 
enforced: 
(a) Against all goods, whenever deposited, belonging to the person who is liable 
as debtor for the claims in regard to which the lien is asserted; and 
(b) Against all goods belonging to others which have been deposited at any 
time by the person who is liable as debtor for the claims in regard to which the lien is 
asserted if such person had been so entrusted with the possession Of goods that a 
pledge of the same by him, her or it at the time of the deposit to one who took the 
goods in good faith for value would have been valid. 
 
SEC. 40. How Warehouse Operator's Lien May be Lost. — A warehouse 
operator loses his, her or its lien upon goods: 
(a) By surrendering possession thereof; or 


 
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(b) By refusing to deliver the goods when a demand is made with which the 
warehouse operator is bound to comply under the provisions of this Act. 
 
SEC. 41. Negotiable Receipts Must State Charges for Which the Lien is 
Claimed. — If a negotiable receipt is issued for goods, the warehouse operator shall 
have no lien thereon except for charges for storage of goods subsequent to the date 
of the receipt unless the receipt expressly enumerated other charges for which a lien 
is claimed. In such case, there shall be a lien for the charges enumerated so far as 
they are within the terms of Section 25 although the amount of the charges so 
numerated is not stated in the receipt. 
 
SEC. 42. Warehouse Operator Need Not Deliver until Lien is Satisfied. — 
A warehouse operator having a lien valid against the person demanding the goods 
may refuse to deliver the goods to him, her or it until the lien is satisfied. 
 
SEC. 43. Warehouse Operator's Lien Does Not Preclude Other Remedies. 
— Whether a warehouse operator has or has not a lien upon the goods, the warehouse 
operator is entitled to all remedies allowed by law to a creditor against a debtor for the 
collection from the depositor of all charges and advances which the depositor has 
expressly or impliedly contracted with the warehouseman to pay. 
 
SEC. 44. Satisfaction of Lien by Sale. — A warehouse operator's lien for a 
claim which has become due may be satisfied as follows: 
(a) An itemized statement of the warehouse operator's claim, showing the sum 
due at the time of the notice and the date or dates when it becomes due; 
(b) A brief description of the goods against which the lien exists; 
(c) A demand that the amount of the claim as stated in the notice of such further 
claim as shall accrue, shall be paid on or before a day mentioned, not less than 
ten (10) days from the delivery of the notice if it is personally delivered, or from 
the time when the notice shall reach its destination, according to the due course 
of post, if the notice is sent by mail; and 
(d) A statement that unless the claim is paid within the time specified, the goods 
will be advertised for sale and sold by auction at a specified time and place. 
 


 
15
In accordance with the terms of a notice so given, a sale of the goods by auction 
may be had to satisfy any valid claim of the warehouse operator for which the 
warehouse operator has a lien on the goods. The sale shall be had in the place where 
the lien was acquired, or, if such place is manifestly unsuitable for the purpose of the 
claim specified in the notice to the depositor has elapsed, and advertisement of the 
sale, describing the goods to be sold, and stating the name of the owner or person on 
whose account the goods are held, and the time and place of the sale, shall be 
published once a week for two (2) consecutive weeks in a newspaper published in the 
place where such sale is to be held. The sale shall not be held less than fifteen (15) 
days from the time of the first publication. If there is no newspaper published in such 
place, the advertisement shall be posted at least ten (10) days before such sale in not 
less than six (6) conspicuous places therein. 
 
From the proceeds of such sale, the warehouse operator shall satisfy his, her 
or its lien including the reasonable charges of notice, advertisement and sale. The 
balance, if any, of such proceeds shall be held by the warehouse operator and 
delivered on demand to the person to whom the warehouse operator would have been 
bound to deliver or justified in delivering goods. 
 
At any time before the goods are so sold, any person claiming a right of property 
or possession therein may pay the warehouse operator the amount necessary to 
satisfy his, her or its lien and to pay the reasonable expenses and liabilities incurred 
in serving notices and advertising and preparing for the sale up to the time of such 
payment. The warehouse operator shall deliver the goods to the person making 
payment if the warehouse operator is a person entitled, under the provisions of this 
Act, to the possession of the goods on payment of charges thereon. Otherwise, the 
warehouse operator shall retain the possession of the goods according to the terms 
of the original contract of deposit. 
 
SEC. 45. Perishable and Hazardous Goods. — If goods are of a perishable 
nature, or by keeping will deteriorate greatly in value, or, by their order, leakage, 
inflammability, or explosive nature, will be liable to injure other property, the 
warehouse operator may give such notice to the owner or to the person in whose 
names the goods are stored, as is reasonable and possible under the circumstances, 


 
16
to satisfy the lien upon such goods and to remove them from the warehouse and in 
the event of the failure of such person to satisfy the lien and to receive the goods within 
the time so specified, the warehouse operator may sell the goods at public or private 
sale without advertising. If the warehouse operator, after a reasonable effort, is unable 
to sell such goods, the warehouse operator may dispose of them in any lawful manner 
and shall incur no liability by reason thereof. 
 
The proceeds of any sale made under the terms of this section shall be 
disposed of in the same way as the proceeds of sales made under the terms of the 
preceding section. 
 
SEC. 46. Other Methods of Enforcing Lien. — The remedy for enforcing a 
lien herein provided does not preclude any other remedies allowed by law for the 
enforcement of a lien against personal property nor bar the right to recover so much 
of the warehouse operator's claim as shall not be paid by the proceeds of the sale of 
the property. 
 
SEC. 47. Effect of Sale. — After goods have been lawfully sold to satisfy a 
warehouse operator's lien, or have been lawfully sold or disposed of because of their 
perishable or hazardous nature, the warehouse operator shall not thereafter be liable 
for failure to deliver the goods to the depositor or owner of the goods or to a holder of 
the receipt given for the goods when they were deposited, even if such receipt be 
negotiable. 
 
CHAPTER V 
NEGOTIATION AND TRANSFER OF RECEIPTS 
SEC. 48. Negotiation of Negotiable Receipt by Indorsement. — A 
negotiable receipt may be negotiated by the indorsement of the person to whose order 
the goods are, by the terms of the receipt, deliverable. Such indorsement may be in 
blank, to bearer or to a specified person. If indorsed to a specified person, it may be 
again negotiated by the indorsement of such person in blank, to bearer or to another 
specified person. Subsequent negotiation may be made in like manner. 
 


 
17
SEC. 49. Transfer of Receipt. — A receipt may be transferred by the holder 
to a purchaser or done. 
 
A non-negotiable receipt cannot be negotiated, and the indorsement of such a 
receipt gives the transferee no additional right.  
 
SEC. 50. Who May Negotiate a Receipt. — A negotiable receipt may be 
negotiated: 
(a) By the owner thereof; or 
(b) By any person to whom the constructive possession of the receipt has been 
entrusted by the owner, if, by the terms of the receipt, the warehouse operator 
undertakes to deliver the goods to the order of the person to whom the 
constructive possession of the receipt has been entrusted. 
 
SEC. 51. Rights of a Person to Whom a Receipt Has Been Negotiated. — 
A person to whom a negotiable receipt has been duly negotiated acquires thereby: 
(a) Such title to the goods as the person negotiating the receipt to him, her or it 
had or had ability to convey to a purchaser in good faith for value, and also such 
title to the goods as the depositor or person to whose order the goods were to 
be delivered by the terms of the receipt had or had ability to convey to a 
purchaser in good faith for value; and 
(b) The direct obligation of the warehouse operator to hold possession of the 
goods for him, her or it according to the terms of the receipt as fully as if the 
warehouse operator contracted directly with him, her or it. 
 
SEC. 52. Rights of Person to Whom Receipt Has Been Transferred. — A 
person to whom a receipt has been transferred but not negotiated acquires thereby, 
as against the transferor, the title of the goods subject to the terms of any agreement 
with the transferor. 
 
If the receipt is non-negotiable, such person also acquires the right to notify the 
warehouse operator of the transfer to him, her or it of such receipt and thereby to 
acquire the direct obligation of the warehouse operator to hold possession of the 
goods for him, her or it according to the terms of the receipt. 


 
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Prior to the notification of the warehouse operator by the transferor or transferee 
of a non-negotiable receipt, the title of the transferee to the goods and the right to 
acquire the obligation of the warehouse operator may be defeated by the levy of an 
attachment or execution upon the goods by a creditor of the transferor or by a 
notification to the warehouse operator by the transferor or a subsequent purchaser 
from the transferor of a subsequent sale of the goods by the transferor. 
 
SEC. 53. Transfer of Negotiable Receipt Without Indorsement. — Where a 
negotiable receipt is transferred for value and the indorsement of the transferor is 
essential for negotiation, the transferee acquires a right against the transferor to 
compel him, her or it to indorse the receipt unless a contrary intention appears. The 
negotiation shall take effect as of the time when the indorsement is actually made. 
 
SEC. 54. Warranties of a Sale of Receipt. — A person who, for value, 
negotiates or transfers a receipt by indorsement or delivery, including one who assigns 
for value a claim secured by a receipt, unless a contrary intention appears, warrants: 
(a) That the receipt is genuine; 
(b) That the person has a legal right to negotiate or transfer it; 
(c) That the person has knowledge of no fact which would impair the validity or 
worth of the receipt; and 
(d) That the person has a right to transfer the title to the goods and that the 
goods are merchantable or fit for a particular purpose whenever such 
warranties would have been implied, if the contract of the parties had been to 
transfer without a receipt of the goods represented thereby. 
 
SEC. 55. Indorser not Guarantor. — The indorsement of a receipt shall not 
make the indorser liable for any failure on the part of the warehouseman or previous 
indorsers of the receipt to fulfill their respective obligations. 
 
SEC. 56. No Warranty Implied from Accepting Payment of a Debt. — A 
mortgagee, pledgee, or holder for security of a receipt who, in good faith, demands or 
receives payment of the debt for which such receipt is security, whether from a party 
to a draft drawn for such debt or from any Other person, shall not, by so doing, be 


 
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deemed to represent or to warrant the genuineness of such receipt or the quantity or 
quality of the goods therein described. 
 
SEC. 57. When Negotiation Not Impaired by Fraud, Mistake, or Duress. — 
The validity of the negotiation of a receipt is not impaired by the fact that such 
negotiation was a breach of duty on the part of the person making the negotiation or 
by the fact that the owner of the receipt was induced by fraud, mistake or duress or to 
entrust the constructive possession of the receipt to such person, if the person to 
whom the receipt was negotiated or a person to whom the receipt was subsequently 
negotiated paid value therefor, without notice of the breach of duty, or fraud, mistake 
or duress. 
 
SEC. 58. Subsequent Negotiation. — Where a person having sold, 
mortgaged, or pledged goods which are in warehouse and for which a negotiable 
receipt has been issued, or having sold, mortgaged, or pledged the negotiable receipt 
representing such goods, continues in constructive possession of the negotiable 
receipt, the subsequent negotiation thereof by the person under any sale or other 
disposition thereof to any person receiving the same in good faith, for value and 
without notice of the previous sale, mortgage or pledge, shall have the same effect as 
if the first purchaser of the goods or receipt had expressly authorized the subsequent 
negotiation. 
 
SEC. 59. Negotiation Defeats Vendor's Lien. — Where a negotiable receipt 
has been issued for goods, no seller's lien or right of stoppage in transitu shall defeat 
the rights of any purchaser for value in good faith to whom such receipt has been 
negotiated, whether such negotiation be prior or subsequent to the notification to the 
warehouse operator who issued such receipt of the seller's claim to a lien or right of 
stoppage in transitu. Nor shall the warehouse operator be obliged to deliver or justified 
in delivering the goods to an unpaid seller unless the receipt is first surrendered for 
cancellation. 
 
CHAPTER VI 
CRIMINAL OFFENSES 


 
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SEC. 60. Issuance of Receipt for Goods Not Received. — A warehouse 
operator or his, her or its agent, officer, or employee who issues or aids in the issuance 
of a warehouse receipt, knowing that the goods mentioned therein are not actually in 
his, her or its custody, shall be punished by imprisonment of ten (10) years, or a fine 
equal to triple the value of the goods involved, or both, at the discretion of the court,  
and the accreditation Of the warehouse operator shall likewise be revoked. 
 
SEC. 61. Issuance of Receipt Containing False Statement. — A warehouse 
operator or his, her or its agent, officer, or employee who fraudulently issues or aids 
in fraudulent issuance of a warehouse receipt for goods, knowing that it contains a 
false statement, shall be punished by imprisonment of ten (10) years, or a fine equal 
to triple the value of the goods involved, or both, at the discretion of the court, and the 
accreditation of the warehouse operator shall likewise be revoked. 
 
SEC. 62. Creation of Fraudulent Duplicate Receipt. — A warehouse 
operator or his, her or its agent, officer, or employee who issues or aids in issuing a 
second electronic warehouse receipt for goods, knowing that there is an existing prior 
electronic warehouse receipt for the same goods or any part of them, shall be punished 
by imprisonment of ten (10) years, or a fine equal to triple the value of the goods 
involved, or both, at the discretion of the court, and the accreditation of the warehouse 
operator shall likewise be revoked. This provision shall not be applicable if the 
issuance of a subsequent warehouse receipt was made on the basis of an order issued 
by a court of competent jurisdiction. 
 
SEC. 63. Issue for Warehouse Operator's Goods or Receipts Which Do 
Not State That Fact. — Where goods are deposited with or held by a warehouse 
operator of which the warehouse operator is owner, either solely or jointly or in 
common with others, such warehouse operator, or any of his, her or its agents, officers, 
or employees who, knowing this ownership, issues or aids in issuing a negotiable 
receipt for such goods which does not state such ownership, shall be punished by 
imprisonment of ten (10) years, or a fine equal to triple the value of the goods involved, 
or both, at the discretion of the court, and the accreditation of the warehouse operator 
shall likewise be revoked. 
 


 
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SEC. 64. Delivery of Goods Without Obtaining Negotiable Receipt. — A 
warehouse operator or his, her or its agent, officer, or employee that delivers goods 
out of the possession of such warehouse operator, knowing that a negotiable receipt, 
the negotiation of which would transfer the right to the possession of such goods is 
outstanding and uncanceled, without obtaining the constructive possession of such 
receipt at or before the time of such delivery, except as otherwise authorized in this 
Act, shall be punished by imprisonment of ten (10) years, or a fine equal to triple the 
value of the goods involved, or both, at the discretion of the court, and the accreditation 
of the warehouse operator shall likewise be revoked. 
 
SEC. 65. Negotiation of Receipt for Mortgaged Goods. —Any person who 
deposits goods which the person has no title, or upon which there is a lien or mortgage, 
and who takes for such goods a negotiable receipt which was afterwards negotiated 
for value with intent to deceive and without disclosing the want of title or the existence 
of the lien or mortgage, shall be punished by imprisonment of ten (10) years, or a fine 
equal to triple the value of the goods involved, or both, at the discretion of the court. 
 
SEC. 66. Unlawful Release of Goods Covered by Warehouse Receipt. — 
A warehouse operator or his, her or its agent, officer, or employee that releases, 
without any legal basis, any goods covered by an electronic warehouse receipt shall 
be punished by imprisonment of ten (10) years, or a fine equal to triple the value of the 
goods involved, or both, at the discretion of the court, and the accreditation of the 
warehouse operator shall likewise be revoked. 
 
CHAPTER 
FINAL PROVISIONS 
SEC. 67. Inter-Connected Registry Information. — Where feasible, the SEC 
shall coordinate with other government agencies in order to link up the Registry 
provided under this Act with other registries. 
 
SEC. 68. Public Information. — All entries in the Registry of electronic 
warehouse receipts shall be available to the public. Likewise, the list of accredited 
warehouse operators, as well as the list of warehouse operators whose accreditation 


 
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have been revoked, shall be available to the public. The SEC shall formulate the 
guidelines to facilitate the orderly and expedient access to such information by the 
public, in accordance with existing standards under Philippine laws. 
 
SEC. 69. Dispute Resolution. — Except in cases specifically placed under the 
jurisdiction of the SEC under this Act, as well as cases where the electronic warehouse 
receipt includes a valid arbitration clause, all actions arising from this Act shall fall 
under the jurisdiction of the Regional Trial Courts. 
 
SEC. 70. Appropriations. — The initial funding for the implementation of this 
Act shall be charged against the current operating budget of the SEC. Thereafter, the 
amount necessary for its continued implementation shall be included in the annual 
operating budget of the SEC. 
 
SEC. 71. Implementing Rules and Regulations. — Within ninety (90) days 
after the effectivity of this Act, the SEC shall promulgate rules and regulations for the 
implementation of this Act. 
 
SEC. 72. Cases Not Provided For in this Act. — Any case not provided for in 
this Act shall be governed by the provisions of existing legislation, or in default thereof, 
by the established rules of commerce. 
 
SEC. 73. Application of this Act. — The provisions of this Act do not apply to 
receipts made and delivered prior to the taking effect hereof. 
 
SEC. 74. Separability Clause. — If any provision of this Act is declared invalid 
or unconstitutional, the other provisions hereof which are not affected thereby shall 
continue to be in full force and effect. 
 
SEC. 75. Repealing Clause. — Act No. 2137, otherwise known as the 
Warehouse Receipts Law, is hereby repealed. Any law, presidential decree or 
issuance, executive order, letter of instruction, administrative order, rule or regulation 
contrary to or inconsistent with any provision of this Act is hereby repealed or modified 
accordingly. 


 
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SEC. 76. Effectivity. — This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette or in a newspaper of general circulation. 
 
Approved,