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Sales PromotionWhat should sponsor / advertisersecure in conducting salespromotion?
1. DTI-NCR number2. Duration of the promotion3. Complete mechanics4. Criteria, disqualification and otherrules that maybe imposed bysponsor/s5. Required entry form6. Manner, date, place and time forselection or determination of winners7. Claim period and redemption center8. Requirements for claiming prizes9. Tax provisions
What is a DTI-NCR number?
 This pertains to the number assignedby the DTI-NCR for approvednationwide sales promotion. This islocated at the lower right side of thead material released by the promotingagency. Presence of this permitnumber means that the salespromotion has been approved /supervised by DTI-NCR.
What are the coverage of the DTI-NCR permit?
1. all sales promotions campaignsconducted within the Philippines2. consumer product or services3. consumer credit4. consumer service5. nationwide beauty contest6. home solicitation sales
Exemptions:
a. sales promotion campaignssponsored by the government, or anyof its agencies, in line with itsgovernment functionsb. imported products under promotionin the country of origin not coveringthe Philippinesc. civic groups sponsored intendedamong members
*Food, drugs, devices, cosmetics, and hazardous substances are covered by Bureau of Food and Drugs (BFAD).
 
What do you mean by duration of the promotion?
 This means the period covering thefirst to the last day that a participantmay join or send or present entries toa sales promotion campaign.
Shall cancellation of a salespromotion be allowed?
An ongoing sales promotion shouldnot be allowed to be cancelled, exceptupon approval from the DTI-NCR.Cancellation shall be allowed onlybefore the ad announcement, and, incase ad announcement is alreadyreleased, before entries are madeavailable to the public.
On what grounds shallcancellation of ongoing promotionbe allowed?
Cancellation of ongoing promotionmay be allowed on any of thefollowing grounds:1. final judgment of insolvency of thesponsor/s from a court of proper jurisdiction2. occurrence of any fortuitous eventthat will make it impossible for allsponsors to deliver the products orservices to be used in the promotion
If a promotion is approved to becancelled and there are alreadywinners before the approval, dothe winners have the right toclaim their prizes?
 Yes. Those who had already won inthe promotion before the approval of its cancellation shall be granted theirprize/s.
What is a complete mechanics?
 This means the rules, procedure andcriteria by which one may participateand win and by which the winner mayclaim his prize in a sales promotioncampaign.
Who shall be disqualified from joining a sales promotion?
1. The sponsor, promoter, advertiser,participating outlets and theiremployees including their relatives upto the second civil degree of consanguinity or affinity.2. Persons reporting regularly to thepromoter, sponsor or advertiser undera contract or service and who, by thenature of the service they render mayhave a direct and personal knowledgeof the promotion3. In case of promotions involvingbank deposits, the Bangko Sentral ngPilipinas (BSP) shall prescribe thedegree of relationship whch shall becovered by the disqualification.
What is a required entry form?
 This may be any proof of purchase,receipts, coupons, tickets, wrappers,labels, packaging, caps, crowns, rafflenumbers, game cards or any otherinstrument identifying the participantand conforming to the specificationsor requirements as laid down in themechanics.
What minimum informationshould be written on the rafflestub?
1. Full name of participant2. Complete address, and telephonenumber, if any3. Signature
*Erasures or any form of tamperingshall invalidate the entry stub / form.
When should the selection ordetermination of winners takeplace?
 The date of draw shall not be morethan two (2) weeks after the deadlineof submission of entries.
Can grand draws or final selectionof winners be postponed?
Grand draws or final selection of winners may only be postponed once,but not more that 2 weeks upon theapproval of DTI-NCR.
Can a participant win more thanonce?
A participant may win more than oneprize, unless expressly disallowed inthe mechanics of the promotion.
If a participant won more thanonce, can he claim both prizes?
If winning more than once isdisallowed in the mechanics of thepromotion. The winner shall beentitled to the bigger prize.
If the winner is not present tochoose the prize, what prize shallbe given to him?
 The winner shall automatically beassigned the higher prize.
What shall be done to the lowerprize not won by disqualifiedwinner?
 The prize shall be re-drawn or otherwinners will be selected.
How does fairness on the conductof the sales promotion beguaranteed?
 1.The DTI representative wouldbe present and will verifyguarantee of delivery of: themechanics, entry forms,prizes, advertising materialsand control measuresapproved prior to issuance of permit2.A DTI representative must beinvited to the following salespromotion activities prior toimplementation:a.Verify computerprogram forregisteringparticipants,accepting entries,assigning rafflenumbers / pointsand tabulation of points.b.Verify computerprogram fordetermination /drawing of winners.c.Witness the printing,sealing and seedingof game cards withnon-winning gamecards.d.Verify the winninggame stubs beforemixing with non-winning game stubsbefore placing insidedraw boxes.e.Verify gameparaphernalia.3.A DTI representative must beinvited to be present andwitness the following:a.Opening of dropboxes and drawing /determination of winnersb.Judging of entries
How are winners of a raffle promobeing notified?
 
Winners should be announced and / orpublished in the same manner thatthe sales promotion was announcedand / or published, not later than 2weeks after determination of winners.
Shall all winners be notified inwriting?
In all cases where the amount of theprize is five hundred pesos (P 500) ormore, the winners shall be notified inwriting by registered mail or anycommunication where proof of noticecan be verified. The list of winners'names and addressed received by thePost office shall be submitted to DTI.
Until when can winners claimtheir prizes?
Winners shall have at least sixty (60)days from the date of the publicationor announcement or notification of winners, whichever comes last, withinwhich to claim their prizes unless ashorter period is allowed by thedepartment taking into account thenature of the sales promotion,mechanics and prizes involved.
Will prizes be forfeited after claimperiod has lapsed?
 Yes. After the claim period has lapsedwithout a claimant, the Departmentshall be immediately informed. Prizesmay be forfeited in favor of thesponsor only upon written approval of the Department.
How shall winners of raffles orpromotions requiring raffletickets or stubs claim theirprizes?
Winners of this type of promotionsmay claim their prizes by presentingtheir copy or portion of the raffleticket or stub and / or any documentwhich the sponsor may reasonablyrequire as sufficient to establish theidentity of claimant.
Can a winner claim his prize if hisraffle stub is lost?
 Yes. If a raffle stub is lost, the winnerwill execute an affidavit of loss. Heshould submit this together with anyof the following documents:1. affidavit of at least two (2)disinterested persons attesting to hisidentity2. certification of the barangaycaptain that the winner is really aresident of that place3. other identification papers likeoffice / school ID, SSS or GSIS number,driver's license, passport, etc.
How can a minor or incapacitatedclaim his prize?
In case where a winner is a minor asevidenced by a birth certificate or isincapacitated, the parent or guardianexercising paternal authority over himmay claim the prize in his behalf.
If prizes are in form of trips orscholarships, can the winners ask for these prizes to be converted /transferred?
Prizes in form of domestic or domestictrips and with or withoutaccommodations and scholarships,shall either be transferable,convertible to cash or both. In suchcases, the cash equivalent of the prizeshall be disclosed in the salespromotion campaign announcements,publications and advertisements.
What is the remedy available forthe winner when the sponsorfailed to deliver a prize which is inkind?
In cases where the sponsor is not ableto deliver a prize promised which is nkind, the winner may be given its cashequivalent as appearing in theapplication for permit to conduct thepromotion and approved by thedepartment. However, if the sponsoroffers to deliver another prize which isalso in kind, he may do so with theconsent of the winner.
Who should pay the tax for theprizes?
Unless otherwise specified, the winnershall pay withholding tax.
How much withholding tax shallbe paid?
 The amount of tax shall be 20% (inexcess of P 10,000.00) of theacquisition cost of the prize.
What must a person do if he/sheintends to conduct a salespromotion?
Any person intending to conduct anyform or scheme for a sales promotioncampaign of a consumer product,service, or credit shall first secure apermit from DTI-NCR at least thirty(30) days before the sales promotionstarts.
What is the requirement if a salespromotion campaign has severalsponsors?
A sales promo campaign with severalsponsors may be filed for a singlesales promotion permit. Provided, thatall sponsors shall sign the salespromotion permit application, orsubmit a true copy of writtenagreement among the sponsors thatthey are the subsidiaries of the salespromotion campaign.
What is the degree or extent of asponsor's participation andresponsibility?
 The degree or extent of a sponsor'sparticipation and responsibility maybe stated in the application or theagreement. When there's no indicatedlimitation of liability or responsibility,each sponsor shall be deemed fullyresponsible for the sales promotioncampaign.
What specific information shouldbe included in the application?
 The application for permit to conducta sales promotion campaign shall bein the form required by theDepartment, containing the followinginformation and documents:1.the complete name, address,and telephone number of thesponsor(s) of the salespromotion campaign;2.the complete name, address,and telephone number of thesales promotion agent oragency, if any;3.the complete name, address,and telephone number of theperson/s who may becontacted by the participantsof the promotion forinquiries, complaints, andsimilar purposes;4.the consumer product, itsbrand, classification and/orsize, or the kind and extendof the consumer service orcredit to be promoted;5.proof of registration of theproduct, or business beingpromoted if the same isrequired by any governmentagency;6.the geographical area to becovered;7.the type or nature of thesales promotion campaign tobe undertaken;8.the sales promotion period;9.the target participants andthe required qualification, if any;10.the type of announcementand/or informationdissemination that will beused for the sales campaignor promotion, including thetext, substance, andinformation to bedisseminated to the public;11.the mechanics and thecriteria for participating andwinning in the salespromotion campaign;12.the procedure forpredetermination of winningentries, and if applicable, thecomputer program to beused;13.the plan for seeding orqualifying entries,paraphernalia orpredetermined winningentries;14.the date, time, and place forauditions, try-outs, pre-qualification and/orqualification of participantsto the promotion, if the sameis required;
15.
the security marks, if any, orthe nature thereof in theentry forms and/orparaphernalia to be used inthe promotion. Their purpose,the method of theirverification, and a samplespecimen of such entry or
 
paraphernalia, containingsuch security mark;16.the deadline of submission of entries17.the specific city, municipality,and province and number of drop boxes or the person andaddress where entry formsmay be sent;
18.
the amount of prizes for eachcategory of winners. If theprizes are in kind, thedescription, brand, size,model, or make, and theirmarket value of the time of application;19.whether a prize in kind istransferable, convertible tocash or both;
20.
whether the required taxesfor the winners shall beshouldered by the sponsor/sor by the winners. In case of the latter, whether the sameshall be withheld by thesponsor/s;
21.
time and dates within whichthe prize can be claimed,after the termination of thesales campaign or promotion-which shall not be less thansixty (60) days fromnotification or publication,whichever comes last;22.the requirements and/or thetype of identification whichwill be required to claim theprizes
Are there exemptions from permitrequirements?
Permits for the following salespromotion activities need not beapplied for:1. Competitions, except beautycontest conducted nationwide, whichdo not require the purchase, lease orpayment of any consumer product orservice or availment of consumercredit;2. Parlor games, whether held liveduring stage shows, parties, specialoccasions and/or utilizing any form of mass media. Provided, that the homepartner of the winner is not requiredto purchase or lease any consumerproduct, service, or avail consumercredit facility, including the sending orpresentation of any proof;3. Door prizes given to patrons of concerts, stage shows, stage plays,film shows, and similar activities;4. Instant sales promotion campaigns;5. In store promotions, such as, butnot limited to price reductionpromotions, discount sales andpremium-in pack in which noadvertisements are made on suchsales promotion campaigns.
*Sales promotion campaign exempted from permit requirement must conform to the pertinent rules and regulations on sales promotioncampaigns.
 
What are the prohibited acts inthe conduct of sales promotion?
1. Gambling and wagering schemes:No gambling or wagering scheme, asprohibited under existing laws shall beallowed in the conduct of any salespromotion campaign.2. Use of Medical Prescriptions: Nosales promotion campaign usingmedical prescriptions or any part of it,as attachment shall be allowed.3. Other prohibited activities:a. No act, product, scheme, oractivity prohibited or declared illegalunder the law shall be allowed in theconduct of the sales promotioncampaign. If an imported product isunder international sales promotion,yet such promotion does not cover thePhilippines, the local distributor of theproduct shall indicate a notice,accompanying the product that theongoing international sales promocampaign is not applicable in thePhilippines.b. No person shall directly orindirectly tamper with the entriesand/or paraphernalia in a salespromotion campaign nor influence theresults, or perform any act to thedisadvantage of the legitimateparticipants and/or winners.
May an approved sales promotioncampaign be discontinued orcancelled?
An approved sales promo campaignmay be terminated or cancelled bythe sponsor/s at its initiative, providedthat no information dissemination andadvertising were made. Written noticemust be sent to the Departmentbefore the cancellation of the salespromotion campaign.
Can a sales promotion becancelled after publication, butbefore the promotion starts?
If any announcement, information,dissemination, or advertising weremade, and the promotion has not yetstarted, the sale promotion may becancelled or terminated by writtennotification to the Department.Announcements of the cancellationmust be immediately disseminated inthe same manner, frequency, andmedium as the promotion has beenannounced, published, or advertisedbefore the originally intendedpromotion period starts.
How is voluntary cancellation of ongoing promotion made?
Only DTI can permit the cancellationof ongoing sales promotion. Anongoing sales promotion may only becancelled based on the followinggrounds:1. A final judgment of bankruptcy of the sponsor/s from a court of proper jurisdiction;2. Unexpected events that will make itimpossible for all the sponsors tocontinue to deliver the products orservices. Provided, however, thatthose who had already won in thepromotion before approval of its (salespromo) cancellation shall be giventheir prizes.
What specific information shouldbe included in theannouncements, publication oradvertisement of the mechanicsof the sales campaign?
 The time, dates, and places of thefollowing events in the salespromotion campaign shall be clearlystated in the announcement,publication, or advertisement of themechanics of the sales campaign:1. The promotion period;2. The deadline for submission of entry forms or entering as participantin the promotion;3. The location of drop boxes for entryforms and/or the address where entryforms may be sent, or where one mayinform the sponsor of one's intentionto participate in the promotion;4. The time, date, and place of thepre-draws, pre-qualifications, try-outs,or auditions to qualify as participant tothe sales promotion;5. The time, date, and place of preliminary draws, preliminaryselection or predetermination of winners of the promotion;6. The time, date, and place of finaldraws or final determination of winners of the promotion;7. The time, duration, and place whereprizes may be claimed by the winners.
What are the other requirementsfor a sales promotion campaign?
1. Availability of entry forms toparticipants: Entry forms shall bemade available in a specific place,during office or store hours, unlessother ways of obtaining them arespecified in the mechanics of thepromotions.2. Deadline of submission of entries: The deadline of submission of entriesshall be at least one (1) day beforethe date of the draw or selection of winners unless, otherwise, the schemeutilized makes the one (1) day periodimpractical.3. Draw dates, date of selection of winners: Draw dates or the date forthe selection of determination of participants or winners to a salespromo campaign shall not be morethan two (2) weeks after the deadlineof the submission of entries, the pre-qualification, audition, or try-out,4. List of winners: A list of the namesof the winners, their addresses andcorresponding prizes, shall befurnished to the Departmentimmediately after they were drawn orselected. Except in the case of salespromotion campaigns involving prizeswith very small monetary value, orthose exempted from applying for apermit.
When is the presence of participants required in the
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