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DEPARTMEO
NTF
TRADE
&INI)USTRY
P H I L I P P I N E S

14-3
DEPARTMENT ORDERNO.
ADMINISTRATIVE
Series ot 2014

IMPLEMENTING OF REPUBLICACT NO. 10642,

RULESAND REGULATIONS
CONSUMERPROTECTION
AN ACT STRENGTHENING IN THE PURCHASE
OF BRANDNEWMOTORVEHICLES

Pursuantto Section 13 of RepublicAct No. 10U2, the followingrules and

regulationsare herebypromulgated:

Title I

RuleI
GeneralProvisions

Section 1. Constructionand Interpretation.These Rulesshall be interpreted,

construed and implementedpursuant to the intents and purposes of the
Declarationof Policyin Section2 of RepublicAct No. 10642.

Section 2. Relation to Other Laws. These rules shall apply primarilyin the
determinationand resolutionof Consumercomplaintsas it relatesto Motor
VehiclescoveredunderThe PhilippineLemonLaw. The provisionsof Republic
Act No. 7394 or "The ConsumerAct of the Philippines", and its lmplementing
Rulesand Regulations, and otherrelatedlaws,shallapplywhereapplicable.

Rulell
Definition of Terms

Section 1. Definitionof Terms.For purposesof this lRR,the followingtermsor

phrasesused in Section3, Definitionof Termsof the PhilippineLemonLaw are
understoodas follows:

1.1. Standards and specifications of the motor vehicle refers to the

standards,description,parts,accessoriesand otherspecifications
such as
but not limited to those containedin the Manufacturer'sor Distributor's
Manual,Owner'sManualand the motorvehicle'sspecification.

Page1 of 8

Enabling Business, Empowering Consumers

*r* / OFFICEOF THE SECRETARY

5/F Industryand InvestmentsBuilding,385 SenatorGil J. PuyatAvenue,1200 MakatiCity,Philippines
Telephone:(+632)899.7450 Fax: (+632)896.1166 E-mail:secretary@dti.gov.ph
 1.2. Noncomplianceby the consumer of the obligations under the
warranty means failure of the consumerto observethe terms and
conditionsstated in the writtenwarrantyof the motor vehicleofferedby
manufacturer/distributor.

Any modificationof existingwarrantyof motorvehicleby the manufacturer

or distributormay be subjectto reviewof the Departmentof Trade and
Industry(DTl)to ensurethatthereshallbe no diminutionof warrantyrights
of the consumer.

1 . 3 . Unauthorizedmodificationmeansalterationmade by the consumeron

the motorvehicleand not authorizedunderthe termsand conditionsof the
sale and/orfrom the factorystandardsof the manufacturer
and distributor.
Theseshallincludealterations on motorengineand vehicleengineering
and body design,mechanicalor electricalsystem,vehicleconversions,
tamperingof fuel managementsystem,emissioncontroland odometer
system.

Modificationthat will not affectthe safety,use and value of the motor

vehicleare excludedfromthisdefinition.

1.4. Abuse or neglectof the brand new motor vehicle

1.4.1 Abuse means the use of a motor vehiclein a mannernot in

accordancewith the provisionsstated in the Owner's Manual, the
Manufacturer'sServiceA//arranty
Booklet.

1.4.2 Neglect meansfailureof the consumerto properlyand regularly

maintainthe Motor Vehiclepursuantto the Owner'sManual/Serviceor
WarrantyBookletprovidedto the Consumer.

1 . 5 . Damageto the vehicledue to accidentor force majeure

1.5.1Accidentmeansany man-made eventthat causesdamageor injury

over whichthe manufacturer,
distributor,
authorizeddealeror retailerhas
no control.

1.5.2Force Majeuremeansany eventcausedby elementsor forcesof

naturesuchas, but not limitedto, typhoon,flood,earthquake
and volcanic
eruptions.

1.6. Repairis a serviceactivityperformedon the MotorVehicleby replacinga

componentor parts,or by performingadjustments to ensureconformityto
the manufacturer's
standardsandspecifications.

I Page2 of 8

'+ e/l
 1.7. RepairAttempt is a processthat beginswhen the Consumerbringsthe
MotorVehicleto the manufacturer, distributor,
authorizeddealeror retailer
for repairof a specificcomplainUs and which shall be completedwithin
fifteen(15) days from deliveryof the motorvehicleto the dealer.lf repair
was completedin excessof fifteen(15) days,the excessperiodshallbe
addedto the LemonLawRightsPeriodof the motorvehicle.

1.8. Samecomplaintrefersto the samenon-conformity occurringin the Motor

Vehicle,arisingfrom the samecauseand conditions,
as was the previous
non-conformitysubjectof a priorrepair.

Rulelll
Scopeand Coverage

Section 1. Coverage.The provisionin Section4 of the law on Coverageis

herebyadopted.

Title ll
Proceduresin AvailingLemonLaw Rights

RuleI
RepairAttempt

Section 1. Repair Attempts. The provisionin Section5 of the law on Repair

Attemptsis herebyadopted.

Section 2. Repair Attempt Process.A completedrepair/joborderconstitutes

one repairattemptby undergoing
the processouilinedbelow.

2.1. The Consumerand/orrepresentative,specifically

authorizedin writingby
the Consumer,bring the motor vehicleto the same authorizedDealer
reportand/ordemonstrate
the complaint
on the MotorVehicle.
2.2. The Dealer,at all times,shall receivethe motorvehicle.and recordsthe
consumer's
complaint on the MotorVehicle.

2.3. The Dealershall advisethe Consumerof the proposedrepair(s)and the

estimated
timeto completethe repair(s).

2.4. The Consumerauthorizesthe repairby affixinghis/hersignatureon the

repair/job
order.

2.5. The Dealer,upon completionof the repairactivity,releasesthe motor

vehicleto the consumerand shallprovidethe Consumerwith an inventory
of repairsdoneas completedand partsreplaced.

2.6. The Dealerreturnsthe partsreplacedand furnishesthe resultsof any test

activitywhichwas performed,if any.

p Page3 of 8
'i'

2.7. Consumerreceivesthe unit and if the motorvehicleis not returnedwithin

fifteen(15)daysfromrelease,the repairis deemedaccepted.

2.8. Any Repaircoveredby the Manufacturer's

Warrantyshall not be charged
for laborand parts.

Section3. RepairAttempt Not Gompleted.A repairattemptthat is startedbut

not completedby the dealerfor reasonattributable
to the dealershallbe treated
as one repairattempt.

Rulell
Noticeof Availmentof LemonLaw Rights

Section1. Notice to Manufacturer,distributor,authorizeddealeror retailer.

In casethe nonconformityissueremainsunresolved afterfour (4) separateRepair
Attempts,the Consumershall, in writing,notify the manufacturer, distributor,
authorizeddealeror retailerof the unresolved
complaintand the Consumershall
invokethe LemonLaw rightsand servingnoticesto all Partiesthrough,courier,
personaldeliveryor postalserviceswithproofof serviceand receipt.

Section2. Responsibilitiesof the Consumer.Thewarrantybookletshallclearly

statethe responsibilities
of the consumeras follows:

2.1. The Consumer

shallkeepcopyof repairrecords;

2.2. The Consumershall ensurethat the odometerreadingor the date of

vehicledeliveryfor FinalAttempt
at the servicingdealeris withinthe Lemon
Lawrightsperiod;

2.3. The Consumershall,in writingand in the form prescribedin the Warranty

Booklet(the Noticeof Availmentform),notifythe manufacturer,distributor,
authorizeddealer or retailerof the unresolvedcomplaintafter four (4)
separaterepairattempts;and

2.4. The Consumer shall likewise retain the documentaryrequirements

specifiedin Section2, Rulelll of theserules.

Section 3. Final Repair Attempt. The consumershall bringthe vehicleto the

manufacturer,distributor, authorized
dealeror retailerfromwherethe vehiclewas
purchased for a final attemptto addressthe complaintof the consumerto his or
hersatisfaction.

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 Rulelll
Availmentof LemonLaw Rights

Section1. Availmentof Lemon Law Rights.The processof availmentstatedin

Section7 of the law is herebyadopted.The complaintshall be filed by the
consumerwiththe DTIofficewithinthe periodprovidedby LemonLaw.Otheruise
the rightto file the sameshallbe deemedprescribed,
in accordance
with Section
3(h)thereof.

Section2. Rights and RemediesUnderAny Other Law. Nothinghereinshall

be construedto limitor impairthe rightsand remediesof a consumerunderany
otherlaw.

Section3. DocumentaryRequirements.In orderfor the consumerto invokethe

Lemonlaw Rights,the followingdocuments
are necessary:

2.1. WarrantyBookleUService
Booklet;

2.2. CurrentMotorVehicleRegistration;

2.3. All repair/job

orderinvoices.and

2.4. Noticeof Availmentstampedreceivedby the Dealeror accompanied

by
proofof receiptby the Dealerof the Noticeof Availment.

Titlelll
Remediesfor DisputeResolution

Section1. AlternativeDisputeResolution.The DTIshallexerciseexclusiveand

originaljurisdictionover disputesarisingfrom the provisionsof this Act. All
disputesarisingfrom the provisionsof this Act shall be settledby the DTI in
accordance with the Section8 of the LemonLaw in relationto the existingDTI
ruleson disputeresolution.

RuleI
DisputeResolutionMechanisms

Section 1. Mediation.A complaintfiled on a causeof actionavailingof rights

anchoredon the LemonLaw shall undergomediationproceedings, as provided
underexistingDTI administrative
rulesand regulations.

Section 2. Arbitration.lf mediationfails,both partiesmay voluntarilydecideto

undertakearbitrationproceedingsand shall notifythe DTI in writingof their
intentionto undertakearbitrationproceedings. The arbitrationproceedings shall
be governedby the provisionsof RepublicAct No. 9285,othenruise knownas the
AlternativeDispute ResolutionAct of 2004" and its lmplementingRules and
Regulations.

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qr--4
Section3, Adjudication.lf both partiesdecidenot to undertakethe arbitration
proceedings,eitherof them may commenceadjudication proceedingsby filinga
verifiedcomplaintor a noticethat a verifiedcomplainthas beenfiled earlierwith
the DTIand upondepositing the amountof TenThousand (Php10,000.00) Pesos
in an escrow accounUdeposit in a bank of his/herchoice.The adjudication
proceedingsshall be administered by the DTI not laterthantwenty(20)working
dayssubjectto the existingDTIadministrative rulesand regulations.
In casea nonconformity issueof the motorvehicleis not found by the DTl, the
escrowdepositshall reimbursethe cost incurredin validatingthe consumer's
complaintand can only be releasedwithan orderfromthe Adjudication Officerof
DTl,othenruise
the escrowamountshallbe returnedto the consumer.

Section 4. Submission of Warranty or Service Booklet. Manufacturers and

Distributors
are requiredto submitto the DTI a copy of the warrantyor service
bookletof all currentmotorvehicles,workshopmanual,and owner'smanualor
pertinentportionthereofwhen requiredfor mediationor adjudication
proceedings
for non-conformitycomplaints.

Section5. Retentionof Serviceof other GovernmentAgenciesor Qualified

Independent Entities to Ascertain Gonsumer Complaint Validity. In
ascertainingthe validityof the Consumer'scomplaint,the DTI shall requestthe
assistancefrom the pool of qualifiedpersonnelof the TechnicalEducationand
Skills DevelopmentAuthority(TESDA)or any independentprivateentity.An
independent qualifiedexpertmaybe anyoneof the following:

5.1. Technicianswho have the highestor appropriateand relevantTESDA

nationalcertification
level.TESDAshallfurtherdevelopcompetencies and
certificationprogramsfor qualifiedexpertsto match currentand future
automotive technologiesand to complement and broadenthe expert'sskill
set.

5.2. Expertscomingfromthe industry.

5.3. DTIaccredited
serviceand repairshops.

Provided,howeverthat expertsabove-mentioned
shall not have any conflictof
interestwithrespectto the case.

Title lV
OtherProvisions

Section 1. SeparabilityClause.In the eventthat the provisionof this Orderis

declaredunconstitutional,
the validityof the otherprovisionshall not be affected
by suchdeclaration.

Page6 of 8
Section 2. RepealingGlause.The provisionsof the DepartmentOrders,rules
and regulations
and otherissuanceof the implementing
agencywhichare clearly
inconsistentwith this order are hereby repealed, modified or amended
accordingly.

Section3. Effectivity. This IRRshalltakeeffectimmediately

afterits publication
in the OfficialGazetteor in at leasttwo (2) newspaperof generalcirculation,
whichevercomes first, and copy thereoffurnishedthe Office of the National
Administrative Registerat the UP Law Center,Universityof the Philippines,
Diliman,QuezonCity.

Signedthis17thdayof November,2014
in MakatiCity.

,n Recommendedby:

Utr&;*aL
VICTORIO
MARIOA. DIMAGIBA
Undersecretary,
Consumer
Protectio
n Grofikr_

Page7 of 8
a{r

ANNEX"A"

F.RM No'-
NotcE oF LEM.N LAw RrcHTs

To: CustomerRelationsManager
Nameof Dealership:
Addressof Dealership:

CopyFurnished:
To: CustomerRelations
Manager
Nameof Manufacturer/Distri
butor:
Addressof Manufacturer/Distributor:

This constitutes
a noticeof my intentionto invokemy rightsunderRepublicAct No.
10642entitled.AN ACT STRENGTHENING CONSUMER PROTECTION IN THE
PURCHASEOF BRAND NEW MOTOR VEHICLES",consideringthat the
manufacturer,distributor,
authorizeddealeror retailer,afierfour(4) separateattempts,
hasbeenunableto resolvethecomplaint indicatedbelow.

Description
of Repair Odometer Dateof Delivery Dateof
Complaint Attempts Reading by Consumer for Completion
of
Reoair Reoair
#1
#2
#3
#4

VehicleMake: Model: Year:

Vehicle ldentificationNumber:

Name/Addressof SellingDealer:

DeliveryDate: CurrentOdometer
Reading:

Repair Name and Addressof Service/RepairFacility Dateof Repair

No.
1
2
3
4

I am requesting
that you makea finalattemptto resolvethe said complaintreported
above.My contactinformation
is:

ContactNo.
Address

Consumer
signature Today's date

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