The Department of Trade and Industry (DTI), Department of Health (DOH), Department of Agriculture (DA), Department of Environment and Natural Resources (DENR), Intellectual Property of the Philippines (IPOPHL) and National Privacy Commission (NPC) issued recently Joint Administrative Order (JAO) No. 22-01, consolidating all existing rules and guidelines on online businesses.
Government agencies issued the JAO to caution merchants selling on Facebook/Meta, Instagram, Viber, Lazada, Shopee, Carousell, and other marketplace platforms against the sale of unlicensed, restricted or prohibited products.
The rules are in response to the proliferation of prohibited and regulated products sold on marketplace platforms and social media marketplaces
Under the JAO, government agencies shall develop a system to exchange intelligence/information on prohibited and regulated items monitored online, including automatic sharing of information with the appropriate regulatory agency on possible violations detected/discovered. This may include the sharing of and access to a database of products/items containing sufficient information, keywords, content, for the purpose.
DTI Secretary Ramon Lopez said, “Institutionalizing this exchange of information between government agencies is one of the ways by which we can make monitoring of compliance by online sellers more efficient. The DTI e-commerce division shall be tasked to coordinate with both the marketplace platforms and government agencies in setting up this mechanism.”
Online businesses are covered by the Consumer Act of the Philippines, the Philippine Standards Law which provides liabilities in case of defective products, or the Intellectual Property Code for counterfeit and pirated goods. Online sellers need to comply with product and service warranties, labeling requirements including price tag placement.
The Department warns that the practice of providing prices through private (or direct) messages to consumers/buyers is considered a violation of the Price Tag law. Online merchants must exhibit the corresponding permit or license number for regulated items as prescribed by regulatory agencies concerned. Online businesses are not allowed to produce, import, distribute, market, sell or transport goods that are prohibited by law.
Consumers and sellers are reminded that fines and penalties provided under existing laws applicable to brick-and-mortar transactions are applicable to online transactions as well.
DTI Undersecretary for Consumer Protection Group (CPG) Ruth Castelo reminds online merchants to comply with the provisions of the Consumer Act and the Price Act. “Laws that apply to brick-and-mortar stores also apply to online business. A price tag required to be pasted on items you buy in stores are also required to be pasted on the products that you buy online or through published price list. Buyers no longer have to ask for the price from the seller, who will almost always say that a private message is sent (P.M. Me). This is a clear violation of the Price Tag law.”
The JAO adopted the ASEAN Online Business Code of Conduct to ensure that merchants are aware of their responsibilities to consumers. “DTI shall continue this advocacy towards the fair treatment of consumers, conformance to local standards, honest and truthful communication, and non-proliferation of fake online reviews, among others”, Castelo added.
Government reminds digital platforms to make sure that merchants who sell on the platforms must secure licenses, permits, and other certification requirements depending on the nature of their business, and of the goods and services they sell. Food and medicines must comply with FDA registration, while 87 consumer products must contain PS marks or ICC stickers. Under the JAO, digital platforms are given 3 calendar days to take down an online post upon notice from the concerned authorized agency, or face charges.
Based on the Google Temasek Bain Study of 2021, the Philippines is the fastest growing internet economy in Southeast Asia.
DTI reported increases in business name registration for retail sale via the internet, and significant growth in consumer complaints against online business.
Lopez said “in order to promote e-commerce. the DTI’s thrust is to build trust between seller and buyers. We have to make sure that consumers have access to quality and safe products. We condemn the sale of fake/counterfeit, substandard or prohibited products online and we will run after violators and merchants who sell unlicensed products including those who do not comply with our statutes.”