“The Consumer Act of the Philippines and the

Process of filing Consumer Complaints”

By:

APRIL GRACE R. PONCE

AB POLSCI-3
IAS, TCGC
December 28, 2023
The Consumer Act of the Philippines (Republic Act No. 7394)
The Consumer Act of the Philippines (Republic Act No. 7394) serves as the main
piece of legislation protecting consumers in the Philippines. On July 15, 1992 was when it
went into effect. The Consumer Act of the Philippines, also known as Republic Act No.
7394, states that the State's policies are to safeguard the interests of consumers, advance their
general welfare, and set industry and corporate standards of conduct. As a result, DTI is
required by Article 159 of the Consumer Act and Sections 2 and 18 of Executive Order No.
913 to defend the rights of consumers by responding to complaints of R.A. violations in a
fair, prompt, and professional manner and other laws pertaining to trade industry, and fair
trade.
In the Philippines, there are a number of laws and regulations that protect consumers
and work to maintain fair and transparent business practices. To protect yourself and make
wise decisions as a customer, it's critical to understand these legal protections. The protection
and rights of consumers play a significant role in the Philippine market. These legal
frameworks aim to guarantee fair and transparent business practices as well as specific rights
for consumers. You may defend yourself against unethical behaviour and make wise
selections while making purchases of goods or services by being aware of and upholding
your legal rights as a consumer. But in the policy of Consumers Act it guarantees customers'
fundamental rights, such as the Right to basic needs, Right to safety, Right to information,
Right to choose, Right to representation, Right to redress, Right to consumer education, and
Right to healthy environment. In addition, the Department of Trade and Industry (DTI) is
designated by the Consumer Act as the principal agency in charge of consumer protection.

According to ATTORNEYS OF THE PHILIPPINES some other affiliated policies of the

consumers act are:
 Product Requirements and Labelling Standards - To guarantee the safety and quality
of diverse consumer items, the DTI has set product standards and labelling requirements.
These regulations are in place to shield customers from buying products that could
endanger their health or well-being. It is against the law for products that don't meet these
requirements to be offered in stores. To make sure you are buying reputable and safe
items, it is crucial for you as a customer to be aware of these criteria and to search for
products that adhere to them.

 Price Act (No. 7581, Republic Act) - Customers are kept safe from dishonest pricing
techniques like profiteering, stockpiling, and overpricing under the Price Act. It seeks to
guarantee that goods and services are not provided to customers at excessive costs. The
Price Act also forbids discriminatory pricing, supplier cooperation, and price
manipulation. This rule was put in place to safeguard customers from dishonest firms and
to encourage fair pricing practices.
 Product Liability for Consumers-Under the Consumer Act, producers, importers, and
retailers of consumer goods are responsible for any harm that arises from faulty
merchandise. This implies that you have the right to pursue damages for losses, injuries,
 or damages if you buy a defective product and it hurts you or your property. This legal
protection is meant to guarantee that companies are responsible for the items they sell and
that customers can seek compensation for any damages they may have caused due to
faulty products.
 Fair Trade Laws- Fair trade practices are encouraged and anti-competitive behaviour is
prohibited by the Price Act and the Philippine Competition Act (Republic Act No.
10667). This covers unfair or misleading trade practices, anti-competitive agreements,
and misuse of dominant market position. In a market where companies compete fairly and
customers have access to options that suit their needs and tastes, these laws are meant to
guarantee a level playing field for consumers.
 Consumer Contracts- Philippines Civil Code and other contract regulation rules
safeguard consumers. It also covers remedies for contract violations and general contract
concepts. Furthermore, contracts for consumer goods must be fair, transparent, and
written in easily understood language according to the Consumer Act. With the use of this
legal protection, businesses may be sure that their contracts with customers protect
consumers and that they are not used unfairly or deceptively.
 Consumer Complaints and Redress- Customers can use channels provided by the DTI
and other government organizations to lodge complaints against unfair or misleading
company practices. Depending on the type and seriousness of the complaint, consumers
may pursue remedy through administrative procedures, mediation, or legal action. A
Lemon Law is another feature of the Consumer Act that enables customers to request a
refund, replacement, or repair of defective items within a specific time frame.
Furthermore, advocacy groups and consumer organizations are essential in defending
consumer rights and helping to resolve concerns from consumers.
 Education and Information- Customers are entitled to accurate and full details about the
products or services they are buying. According to the Consumer Act, companies must
give customers clear and comprehensive information on the features, costs, warranties,
and other pertinent facts of the products they offer. Along with learning more about the
goods and services they plan to buy, consumers are also urged to conduct their own
research and self-education. This shields customers from being duped or misled and gives
them the power to make educated decisions.
 Online Consumer Protection- Consumer protection in the world of the internet has
become increasingly important with the growth of internet sales and online transactions.
The Philippines has passed rules protecting internet customers, thereby including the Data
Privacy Act (Republic Act No. 10173) and the Electronic Commerce Act (Republic Act
No. 8792). These rules set guidelines for internet firms, safeguard the privacy of
consumer data, and control online transactions. To safeguard themselves against fraud,
scams, and other online hazards, consumers should be informed of their rights and
proceed with caution when transacting online.
Any act or practice by a producer, manufacturer, supplier, or seller that deceives a
customer into entering into a sales or leasing transaction of any consumer product or service
by deception, fraud, or deception-related means is considered deceptive. It is not always the
case in an economy that manufacturers or companies are in charge and have the last word. In
a similar vein, customers contribute. It is you, the customer, who demands and makes use of
the products and services that different companies provide. It is crucial that you stand up for
and use your rights in order to combat unfair trade practices and keep yourself from being
easily taken advantage of. In this sense, consumer protection becomes more than just hearsay
and becomes a reality. Each of you wants to be treated securely, fairly, and honestly in every
transaction you make as you are all consumers.

PROCESS OF FILING AND HANDLING COMPLAINTS IN DTI

As a result of implementing the Consumer Act, DTI is required by Article 159 of the
Consumer Act and Sections 2 and 18 of Executive Order No. 913 to defend the rights of
consumers by responding to complaints of R.A. violations in a fair, prompt, and professional
manner and other laws pertaining to trade, industry, and fair trade. According to Department
of Trade and Industry we can file complaints by sending them our concerns that matters on
warranties, No Return, No Exchange (NRNE) and other mediatable related concerns through
their national or provincial offices and via email. To file a complaint, download the
Complaint Form, fill it out, and send it in with the necessary information, or compose a letter
of complaint. It should be composed of complete name, address, email and contact number of
complainant and respondent, Narration of facts, Demand, and Scanned and attached proof of
transaction and any government-issued ID of the complainant.

As to information posted on their website, complainants residing along Metro Manila may
file a complaint by email at consumercare@dti.gov.ph or in person to:
 THE DIRECTOR
FAIR TRADE ENFORCEMENT BUREAU
DTI Fair Trade Enforcement Bureau (FTEB)
UPRC Building 315 Sen. Gil J. Puyat Ave.,
1200 Makati City, Philippines
And refer to the directory for the relevant provincial office if you are a complainant living
outside of Metro Manila.
According to Cruz Marcelo & Tenefrancia (2023) based from the “Revised Rules of
Mediation and Adjudication of Consumer Complaints”, the DTI has distinguished between
complaints made against "Bagwis Awardee" and "Non-Bagwis Awardee" commercial
premises under the Revised Rules. The DTI-Bagwis Awards honor businesses that protect
consumer rights and conduct ethical business, providing customers with the best value for
their money. When a business establishment is the target of a complaint, it must endorse the
complaint to the relevant business establishment within two (2) working days. The business
institution must then respond to the complaint within seven (7) calendar days of receiving the
endorsement. The complaint will be considered resolved and will be documented as such if
the relevant business establishment does not file a report within the allotted seven days. If
not, a Notice of Mediation will be sent out.
In contrast, the DTI will promptly send out a Notice of Mediation in response to a complaint
filed against "Non-Bagwis Awardee" commercial establishments.
 As per information gathered that matters about concerns/complaints on
telecommunications, banking and finance, insurance, mutual funds, electricity, fishery
products, livestock, agriculture, coconut- and sugar-based products, forest-based products,
liquefied petroleum gas, and food in restaurants, eateries, or ambulant shops, may be
processed by the corresponding organizations indicated below.

Matrix of Consumer Agencies and Areas of Concerns

Specific Concern
Telephone rates, cellphones, TV, radio
broadcast, and internet
Adulterated livestock feeds, vaccines,
pharmaceuticals and biologics
Pet animals
Fertilizer and pesticide
Rice
Processed and unprocessed meat and
dressed chicken
Fruits and Vegetables
Banks, non-bank financial institutions,
pawnshops, and credit cards
Prices of coconut oil, husked nuts, and fresh
young coconuts
Agency Concerned
National Telecommunications Commission
(NTC)
Bureau of Animal Industry (BAI) – Animal
Feed Standard Division and Laboratory
Services
Bureau of Animal Industry (BAI) – Animal
Health Division
Department of Agriculture (DA) – Fertilizer
and Pesticide Authority (FPA)
National Food Authority (NFA)
National Meat Inspection Service (NMIS)
Bureau of Plant and Industry (BPI)
Bangko Sentral ng Pilipinas (BSP)
Philippine Coconut Authority (PCA)

Quality standards of coconut-based products

Sugar quality and price
Quality/price of the liquefied petroleum gas Oil Industry Management Bureau (OIMB)
(LPG) and liquid fuels
Electricity
Forest and forest-based products
Ozone-depleting substances
Life and non-life insurance claim, pre-need
plans such as educational, pension and
memorial
Mutual funds (investment);
financing/lending; listed companies,
registered issuers of securities (time
sharing)
Sugar Regulatory Administration (SRA)
Energy Power Industry Management Bureau
(EPIMB)/Department of Energy-Consumer
Welfare and Promotion Office (DOE-
CWPO)/Energy Regulatory Commission
(ERC)
Department of Environment and Natural
Resources (DENR)
Department of Environment and Natural
Resources (DENR)
Insurance Commission (IC)
Securities and Exchange Commission (SEC)
– Corporation Finance Department
 Claim for insured deposit; follow-up status
of claim for insured deposit; queries on
deposit insurance coverage, other bank
related issues/concerns i.e. unserviced
withdrawals, ATM problems, etc.
Manufactured products
Hospitals and doctor’s services, processed
foods, drugs, cosmetics, and medical
services or household products with
hazardous substances
Fish and fishery products
Food in restaurants, eateries and sidewalk
vendors as well as on regulation of practice
relative to weights and measures
Philippine Deposit Insurance Corp. (PDIC)
Department of Trade and Industry (DTI)
Department of Health (DOH), Center for
Health Development Metro Manila, and
Food and Drug Administration (FDA)
Bureau of Fisheries and Aquatic Resources
(BFAR)
City Health Office of the concerned Local
Government Units (LGUs)

PROCESS OF MEDIATION IN DTI

In order to help the parties in a disagreement reach a mutually agreeable resolution, a
third party, or mediator, will step in and mediate the situation. The parties meet with the
mediator in an impartial setting so they can talk about the conflict and consider different
options. You can resolve your disagreement in a flexible manner with the opposing party or
parties through a mediated agreement. An arbitration or trial are not the same as mediation.
Time and money can be saved by mediation. Rather of taking a chance on the verdict of a
judge or jury in a court of law, you are aware of what you have agreed to during mediation.
Inquiries, reframing of the problems, aiding in mutual understanding, and assistance in
finding solutions are all done by the mediator. Mediation allows personalized solutions.

As based to DTI mediation is mandatory in all consumer complaints involving

violation of the Consumer Act of the Philippines and Other Fair Trade Laws. It is a condition
precedent for the filing of formal complaints for adjudication under Rule IV Department
Administrative Order No. 20-02 Series of 2020.
A Certificate to File Action (CFA) may be issued by the DTI Mediation Officer in the
event that mediation fails and the parties are unable to reach an equitable settlement. If a CFA
is granted, the complainant may then move on with submitting a formal complaint for
adjudication to the appropriate DTI office.

Mediation Process:
• Receive Complaint
• Evaluate Complaint
• Issue Notice of Mediation
• Conduct Mediation
 As per Cruz Marcelo & Tenefrancia (2023) The Department of Trade and Industry
(“DTI”) issued on 7 February 2020 Department Administrative Order (“DAO”) No 02, Series
of 2020, otherwise known as the “Revised Rules of Mediation and Adjudication of Consumer
Complaints” which includes the Notice of Mediation may now be served to the affected
business establishment via email at its web address that is listed with the Securities and
Exchange Commission ("SEC") or DTI, in addition to being served in person, by courier, or
by registered mail, according to the Revised Rules. The mediation procedures will be
discontinued and a Certificate to File Action ("CFA") will be granted by the Mediation
Officer in the event that the address provided cannot be located, was provided incorrectly, or
was closed for business. Section 3, Rule III
The current mediation time is seven (7) working days from the date the notice of
mediation was served. It may be extended for a maximum of ten (10) working days with the
consent of both parties and in accordance with any applicable laws and regulations. Rule III,
Part Four
The Mediation Agreement shall be executed in a final and executory manner;
however, the parties may, by mutual consent, seek the issuance of a judgment on their
agreement. In such event, they shall jointly file, before the Adjudication Office, a verified
petition within three (3) working days of the Mediation Agreement's execution, stating the
facts of the agreement and the relief requested, and praying for approval thereof and the
issuance of a decision based thereon. Notably, the Adjudication Office does not require the
Submission of a Mediation Agreement. Section 6.2 of Rule III
A CFA will be issued by the Mediation Officer and copies served to the parties if
there is a breach of the mediation agreement [Rule III, Section 6.3(a)], no settlement is
reached by the parties, or the party being sued declines to show up for the scheduled
mediation conference. [Section 6.3 (b) of Rule III]
The complaint will be withdrawn without prejudice to be refiled if the complainant or
his/her representative fails to show up for two (2) consecutive scheduled mediation
conferences without good reason and gives adequate notice; provided, however, that a similar
failure or refusal to appear after such refiling will cause the complaint to be withdrawn with
prejudice. [Part 6.4 of Rule III]
Mediation is terminated upon:
 Lapse of the 3-day period without the parties submitting the Mediation Agreement to
the Adjudication Office. [Rule III, Section 6.5 (a)]
 Service on the complainant of the CFA. [Rule III, Section 6.5 (b)]

ADJUDICATION OF CONSUMER COMPLAINTS

In DTI they have their ADJUDICATION DIVISION which serves arbitrates and
decides consumer complaints alleging R.A. violations. Executive Order No. 913, titled
"Strengthening the Rule-Making and Adjudicatory Powers of the Minister of Trade and
Industry in Order to Further Protect Consumers," was issued on October 7, 1983. It
establishes formal charges for violations of Trade and Industry/Fair Trade Laws in
accordance with Sections 2 and 18.
Black’s Law Dictionary defines Adjudication as the legal process of resolving a
dispute. The formal giving or pronouncing a judgment or decree in a court proceeding; also
the judgment or decision given. In Consumer Complaints handling, the process of
adjudication starts after efforts to arrive at an amicable settlement have failed during the
Mediation stage, the Complainant may opt to pursue his/her consumer complaint further by
filing a formal complaint with the Adjudication Division.
The case will be put to a vote following the submission of all parties' position papers
or, if that deadline has passed, after the filing of those papers, whichever comes first. [Rule
IV, Part Ten]. When it is decided that pertinent issues raised in the parties' position papers,
their accompanying affidavits, or the documentary evidence need to be clarified and
elaborated upon for a proper resolution of the case, the adjudication officer may hold a
clarificatory hearing. After the deadline for filing position papers has passed, the adjudication
officer will issue an order establishing the hearing within five (5) working days. [Rule IV,
Part Twelve] Cruz Marcelo & Tenefrancia (2023)
As soon as the necessary conditions are met, the complaint will be forwarded to the
adjudication officer, who will then have ten (10) working days to decide the consumer
complaint by directing the parties to file their corresponding position papers. Once the
position papers are received, the adjudication officer will assess if the complainant is eligible
for the Repair, Replace, or Refund remedy. If required, the officer may additionally apply the
relevant administrative penalty or sanction as stipulated by applicable laws or regulations.

The most common issues that brings complaints are more on things like under the:
 Liability for Product and Services (i.e. Defective or Imperfect Products/Services) in
which any product flaw that could put customers at undue risk of damage is considered
faulty. These faults are usually the result of design or manufacturing errors, and they are
harmful enough to cause physical harm. Claims for defective products usually fall into
three categories: inadequate or insufficient warnings, manufacturing flaws, and poor
design.
 Deceptive Sales Acts/Practices Deceptive Practices-An act or practice is deceptive when
it meets the following criteria; a representation, omission, or practice misleads or is likely
to mislead the consumer. A consumer’s interpretation of the representation, omission, or
practice is considered reasonable under the circumstances. The misleading representation,
omission, or practice is material.
 Violation for printing “No Return. No Exchange” in the receipts- However just to
clarify, the policy does not apply under the following situations like; If the product
purchased has no imperfection or defect, or if not expired or fake, the store may opt
not to replace or refund , When the defects of the goods are due to the mishandling of
the buyer, In cases of “as-is-where-is” transactions , If the consumer had a change of
mind & The sale of second-hand articles.
 Chain Distribution Plans or Pyramid Sales Schemes- Chain Distribution Plans or Pyramid
Sales Schemes & etc. - A classic example of a pyramid scheme is a chain letter. Recipients
 are encouraged to add new people to the chain and to also send money or gifts to those at the
top of the chain. These are illegal practices and like all other pyramid schemes, 90% of
participants will lose money.

CONCLUSION:

In the Philippines, people are protected as a consumer by numbers of laws and rules
that uphold your rights and guarantee honest and open business dealings. The Consumer Act,
product standards and labelling regulations, fair trade legislation, consumer product liability,
consumer contracts, consumer complaints and redress systems, education and information,
and online consumer protection are just a few of the legal protections that you should be
aware of. Understanding and utilizing your rights as a consumer will help you avoid unfair
business tactics, make wise decisions, and maintain a fair and healthy marketplace. To
safeguard your rights as a customer in the Philippines, never forget to exercise caution,
inquire, and seek help when required. As this paper ends, it’s not just the policy that can
protect you against the danger and abuse you might encounter as a consumer, it also requires
the needs of being a responsible consumer in which Critical Awareness, Action, Social
Concern, Environmental Awareness, & Solidarity. In which it is our duty to exercise greater
caution and inquiry regarding the type, cost, and quality of the products and services we
utilize. We also have an obligation to stand up for ourselves and take action to guarantee that
we acquire a fair bargain. We have a responsibility to consider how our consumption affects
other citizens, particularly the underprivileged, exploited, and powerless groups in our local,
national, and global communities. We also have a responsibility to comprehend the
environmental effects of our consumption. Never forget that as long as we choose to remain
passive consumers, we will continue to be exploited. It is important for us to acknowledge
our personal and collective obligations to preserve the environment and safeguard natural
resources for coming generations. It is our duty as consumers to band together in order to
gain the power and influence necessary to advance and defend our rights. Practice our rights
and do our responsibilities as consumers.
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adjudication/

DTI Philippines, Complaints. (2023, August 4). Department of Trade and Industry
Philippines. https://www.dti.gov.ph/konsyumer/complaints/

DTI Philippines, Complaints handling. (n.d.). Fair Trade Enforcement

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https://fairtrade.dti.gov.ph/faq/what-is-adjudication/

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