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Consumer-Protection Reviewer 29oct24

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REPUBLIC ACT NO.

7394 advertises, or promotes the disposition or


CONSUMER ACT OF THE PHILIPPINES supply of a consumer product;
2.) or who other than the consumer, engages
I.) DECLARATION OF POLICY in, enforces, or otherwise participates in
a consumer transaction
It is the policy of the State to protect the Notes:
interests of the consumer, promote his general
welfare and to establish standards of conduct - A supplier is still considered as such, whether
for business and industry. Towards this end, the or not there is any privity of contract with the
State shall implement measures to achieve the consumer.
following OBJECTIVES:
Ex: A supplies soy sauce to B who purchases
a) protection against hazards to health and the same and offers it to the general public. C,
safety; as the direct buyer purchases the soy sauce
b) protection against deceptive, unfair and from the store of B.
unconscionable sales acts and practices;
c) provision of information and education to Here, even if A does not directly sell the soy
facilitate sound choice and the proper exercise sauce to C, he is still regarded as a supplier
of rights by the consumer; under the law.
d) provision of adequate rights and means of
redress; and - A supplier also includes his successors or
e) involvement of consumer representatives assignees in interest.
in the formulation of social and economic
policies. Ex: If A sold his interest in his business, the
transferees or assignees of the business is
II.) DEFINITION OF TERMS bound by the said supply agreement.

a.) Who is a Consumer? c.) Who is a Manufacturer?

A natural person who is a: Any person who:

1.) Purchaser of consumer products, 1.) Manufactures consumer products;


services or credit; 2.) Assembles consumer products;
2.) Lessee of consumer products, services or 3.) Processes consumer products,
credit;
3.) Recipient of consumer products, services Notes:
or credit; or
4.) prospective purchaser, lessor or - A person who attaches his own brand name
recipient of consumer products, services to the consumer product is considered as the
or credit. manufacturer even if the goods are
manufactured assembled or processed by
b.) Who is a Supplier? another person.

1.) A person, other than a consumer, who in Ex: A manufactures, assembles, and
the course of his business, solicits, offers, processes soy sauce. B, who owns a brand
name “DATU ITIM” purchases the soy sauce

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and attaches the brand name for sale to the Consumer products include chattels that
general public. In this case, B is considered as are intended to be affixed to land, or of
the manufacturer. services, or of any right, title, or interest
therein, except securities as defined in the
- In case of imported consumer products, the Securities Act and contracts of insurance
representative of the manufacturer or, in his under the Insurance Code.
absence, the importer shall be considered as
the manufacturer.

d.) Who is a Seller? 2.) A solicitation or promotion by a supplier


with respect to a transaction referred to in
1.) A person engaged in the business of selling item 1.
consumer products directly to
consumer; 3.) A grant of provision of credit to a
consumer for purposes that are primarily
2.) A seller who is a subsidiary or affiliate of personal, family, household or
the supplier or distributor; agricultural, or

3.) A seller who interchanges personnel or III.) CONSUMER PRODUCT QUALITY AND
maintains common or overlapping SAFETY
officers or directors with the supplier or
distributor; DECLARATION OF POLICY: It shall be the duty of
the State:
4.) A supplier or distributor who provides or
exercises supervision, direction or a) to develop and provide safety and
control over the selling practices of the quality standards for consumer
seller. products, including performance or use-
oriented standards, codes of practice and
e.) Who is a Retailer? methods of tests;
b) to assist the consumer in evaluating the
A person engaged in the business of selling quality, including safety, performance
consumer products directly to consumers. and comparative utility of consumer
products;
Note: The criterion is that the sale is retail if the c) to protect the public against
purpose is to sell the product to the end unreasonable risks of injury associated
consumer. It is wholesale, and not retail, if the with consumer products;
product is sold for “resale” and not for d) to undertake research on quality
consumption of the end consumers. improvement of products and
investigation into causes and prevention
f.) What is a consumer transaction? of product related deaths, illness and
injuries;
1.) a sale, lease, assignment, award by e) to assure the public of the consistency
chance, or other disposition of of standardized products.
consumer products.

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The Agencies in charge with the implementation CLASSIFICATION OF STANDARDS:
of theses policies are the DOH, DA, and DTI. Their
respective scope are as follows: International Standard: s standard published by
an international standardizing organization such
AGENCY SCOPE as the Internation Organization for
DOH food, drugs, cosmetics, Standardization (ISO) and the International
devices and substances Electrotechnical Commission (IEC), Asia-Pacific
DA agriculture Economic Association (APEC)
DTI other consumer products
not specified above. Regional Standard: a standard developed or
adopted by a regional standardizing organization
such as the European Committee for
These agencies shall establish consumer Standardization (CEN) and Pan American
product quality and safety standards which Standard Commission (COPANT)
shall consist of one or more of the following:
National Standard: a standard developed or
a) requirements to performance, adopted and published by a National Standard
composition, contents, design, body, such as the Philippine National Standards.
construction, finish, packaging of a This is implemented by the Bureau of Philippine
consumer product; Standards which aims to develop, promulgate,
and implement standards for all products in
b) requirements as to kind, class, grade, the Philippines, to promote standardization
dimensions, weights, material; activities in the country, and to ensure the
manufacture, production, and distribution of
c) requirements as to the methods of quality products for the protection of the
sampling, tests and codes used to check consumer.
the quality of the products;
Generally, these standards are not mandatory.
d) requirements as to precautions in However, obtaining certifications from
storage, transporting and packaging; international and regional organizations can
create a preferential leverage on a specific
e) requirements that a consumer product be product.
marked with or accompanied by clear
and adequate safety warnings or For National Standard, there are standards that
instructions, or requirements respecting the manufacturer, supplier, seller and retailer of
the form of warnings or instructions. consumer products must comply under R.A
7394.
A standard is a document established by
consensus and approved by a recognized body WHAT STANDARD SHOULD THIS AGENCIES
that provides for common and repeated use, IMPLEMENT?
rules, guidelines or characteristics for activities
or their results, aimed at the achievement of the General Rule: The concerned department shall
optimum degree of order in a given context. adopt existing government domestic product
(ISO/IEC Guide 2). quality and safety standards:

Exceptions:

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After publication, it shall no longer be legal to, or
Special Technical Committees: In the absence cause to, sell or distribute the consumer product
of such standards, the concerned department not complying with the standards or rules.
shall form specialized technical committees
composed of equal number of representatives WHAT IS THE PROHIBITION AGAINST
from each of the Government, business and STOCKPILING?
consumer sectors to:
The term "stockpiling" means manufacturing or
1.) formulate, develop and purpose importing a product between the date of
consumer product quality and safety promulgation of its consumer product safety
standards; rule and its effective date, at a rate which is
2.) consult with the private sector, which significantly greater than the rate at which such
may, motu proprio, develop its own product was produced or imported during a base
quality and safety standards that shall period as prescribed in the regulation.
be subject to public hearings;
3.) consider existing international standards The department may, by regulation, prohibit a
recognized by the Philippine Government. manufacturer from stockpiling consumer
products to prevent circumventing the purpose
PUBLICATION OF THE CONSUMER PRODUCT of the promulgation of the safety standards.
STANDARD:
WHAT ARE THE DUTIES OF THE DEPARTMENT
The concerned department, shall after CONCERNED IN RELATION TO INJURIOUS,
promulgation cause the publication of the DANGEROUS AND UNSAFE PRODUCTS
standard in two (2) newspapers of general
circulation at least once a week for a period of 1.) For Injurious, Dangerous, and Unsafe
not less than one (1) month. Products –

It may likewise conduct an information campaign By their own initiative or by petition of a


through other means deemed effective to ensure consumer:
the proper guidance of consumers, businesses,
industries and other sectors concerned. Make the appropriate order for its recall,
prohibition or seizure from public sale or
EFFECTIVITY OF THE STANDARD: distribution, after notice and hearing.

General Rule: Each consumer product standard 2.) For IMMINENTLY Injurious, Dangerous, and
or safety rule shall specify the date such rule is to Unsafe Products –
take effect, which shall not exceed ninety (90)
days from the date promulgated. By exercise of sound discretion:

Exception: the concerned department funds, for Declare a consumer product to be imminently
good cause shown, that a later effective date is injurious, unsafe or dangerous, and order is
in the public interest and publishes its reasons immediate recall, ban or seizure from public sale
for such finding. or distribution, in which case, the seller,
distributor, manufacturer or producer thereof
WHAT IS THE EFFECT OF PUBLICATION? shall be afforded a hearing within forty-eight (48)
hours from such order.

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product standards or to repair the defect in
EFFECTIVITY OF THE BAN OF INJURIOUS, order to conform with the same;
DANGEROUS AND UNSAFE PRODUCTS
b) to replace the product with a like or
The ban on the sale and distribution of a equivalent product which complies with the
consumer product adjudged injurious, unsafe or applicable consumer product standards
dangerous, or imminently injurious, unsafe or which does not contain the defect;
dangerous shall stay in force until such time
that its safety can be assured or measures to c) to refund the purchase price of the product
ensure its safety have been established. less a reasonable allowance for use; and

AMENDMENT AND REVOCATION OF d) to pay the consumer reasonable damages


DECLARATION OF THE INJURIOUS, UNSAFE OR as may be determined by the department.
DANGEROUS CHARACTER OF A CONSUMER
PRODUCT Notes:

Any interested person may petition the - The consumer shall not incur any expense
appropriate department to commence a or cost from availing these remedies.
proceeding for the: - Any amendment or revocation of a
consumer product safety rule shall specify
1.) issuance of an amendment or revocation of the date on which it shall take effect which
a consumer product safety rule; or shall not exceed ninety (90) days from the
2.) an order declaring a consumer product date of amendment or revocation is
injurious, dangerous and unsafe. published unless there is good cause to
set the sate on a later date.
In case the department, upon petition by an WHAT ARE THE DUTIES OF THE DEPARTMENT
interested party or its own initiative and after due CONCERNED IN RELATION TO NEW PRODUCTS
notice and hearing, determines a consumer
product to be substandard or materially 1.) Make a list of new consumer products; and
defective, it shall so notify the manufacturer, 2.) Cause the publication by the respective
distributor or seller and order them to: manufacturers or importers a list of such
products with the descriptions
a) give notice to the public of the defect or
failure to comply with the product safety CERTIFICATION OF CONFORMITY TO
standards; and CONSUMER PRODUCT STANDARD

b) give notice to each distributor or retailer of The Department shall aim to establish a
such product. consumer product standard, conduct inspection,
and issue certification of quality and safety
The department shall also direct the standard of the consumer products before
manufacturer, distributor or seller of such distribution to the consuming public.
product to extend any or all of the following
remedies to the injured person: (C.R.R.D)

a) to bring such product into conformity with


the requirements of the applicable consumer

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2) is or has been determined to be injurious,
unsafe and dangerous;
Establish
Standard 3) is substandard; or

4) has material defect.


Conduct
Inspection In order to determine if the product for
importation falls under the above-enumerated
grounds for non-admission, a sample in a
Issue quantity necessary may be obtained by the
Certification
concerned department or agency.

WHAT ARE THE RIGHTS OF THE OWNER OR


Distribution to
the consuming CONSIGNEE OF THE IMPORTED CONSUMER
public PRODUCT DURING THE EXAMINATION OF THE
SAMPLE GIVEN?

The manufacturer shall avail of the Philippine Such person shall be afforded an opportunity to a
Standard Certification Mark, after complying with hearing with respect to the importation of such
the standards: products into the Philippines.

If it appears that an imported consumer product


does not conform to the consumer product safety
rule or is injurious, unsafe and dangerous, is
substandard or has a material defect, such
product shall be refused admission UNLESS the
owner or the consignee manifests under bond
that none of the above ground for non-admission
exists or that measures have been taken to cure
them before they are sold, distributed or offered
for sale to the general public.

WHAT ARE THE DUTIES OF THE DEPARTMENT Any consumer product, the sale or use of which
CONCERNED IN RELATION TO IMPORTED has been banned or withdrawn in the country of
PRODUCTS? manufacture, shall not be imported into the
country.
Any consumer product offered for importation
into the customs of the Philippine territory shall CAN THE CONSIGNEE / IMPORTER MODIFY A
be refused admission if such product: (F.I.S.MD) PRODUCT WHICH DOES NOT CONFORM WITH
THE APPLICABLE CONSUMER PRODUCT
1) fails to comply with an applicable STANDARD?
consumer product quality and safety standard
or rule; YES. If it appears that any consumer product can
be so modified that it can already be accepted,
the concerned department may defer final

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examination as to the admission of such 1.) it can be shown that such product is
product for a period not exceeding ten (10) manufactured, sold or held for sale for
days, and in accordance with such regulations. export from the Philippines;
2.) or that such product was imported for
Such product may be released from customs export;
custody under bond for the purpose of 3.) such consumer product or the packaging
permitting the owner or consignee an opportunity thereof bears a stamp or label stating that
to so modify such product. such consumer product is intended for
export and actually exported.
All modifications taken shall be subject to the
supervision of the concerned department.
WHAT ARE THE OTHER POWERS AND
If the product cannot be so modified, or if the FUNCTIONS OF THE DEPARTMENTS?
owner or consignee is not proceeding to
satisfactorily modify such product, it shall be a) to administer and supervise the
refused admission and the department may implementation of this Article and its
direct redelivery of the product into customs implementing rules and regulations;
custody, and to seize the product if not so
redelivered. b) to undertake researches, develop and
establish quality and safety standards for
WHAT IS THE EFFECT IF AN IMPORTED consumer products in coordination with
PRODUCT IS NOT ADMITTED? other government and private agencies
closely associated with these products;
General Rule: It must be exported,
c) to inspect and analyze consumer
Exception: that upon application, the products for purposes of determining
Commissioner of Customs may permit the conformity to established quality and safety
destruction of the product if, within a standards;
reasonable time, the owner or consignee thereof
fails to export the same. d) to levy, assess, collect and retain fees as
are necessary to cover the cost of inspection,
All expenses in connection with the destruction certification, analysis and tests of samples of
and all expenses in connection with the storage, consumer products and materials submitted
cartage or labor with respect to any consumer in compliance with the provisions of this
product refused admission shall be paid by the Article;
owner or consignee and, in default of such
payment, shall constitute a lien against any future e) to investigate the causes of and maintain
importation made by such owner or consignee. a record of product-related deaths, illnesses
IS THE ARTICLE ON SAFETY OF IMPORTED and injuries for use in researches or studies
PRODUCTS APPLICABLE TO CONSUMER on the prevention of such product-related
PRODUCTS FOR EXPORT? deaths, illnesses and injuries.

No. The said requirement for safety is not f) to accredit independent, competent non-
applicable to consumer products for export. A government bodies, to assist in (1)
consumer product is deemed for export if: monitoring the market for the presence of
hazardous or non-certified products and

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other forms of violations of Article 18; and (2) 2.) Imprisonment – not less than 2 months
other appropriate means to expand the but not more than 1 year;
monitoring and enforcement outreach of the 3.) Fines and Imprisonment – upon
department in relation to its manpower, discretion of the Court.
testing and certification resources at a given 4.) Deportation – in case of alien offender
time. 5.) Cancellation of Naturalization – in case
of naturalized citizen.
g) to accredit independent competent
testing laboratories. For Corporation:

IV.) PROHIBITED ACTS AND PENALTIES 1.) Penalties as prescribed above – to be


imposed upon any director, officer or
WHAT ARE THE PROHIBITED ACTS AND agent of a corporation who order or
PENALTIES perform the prohibited acts and who has
knowledge or notice of noncompliance
It shall be unlawful to manufacture for sale, received by the corporation.
offer for sale, distribute in commerce, or 2.) Revocation of License – in case the
import into the Philippines any consumer offender is a foreign juridical entity
product which is: licensed to do business in the Philippines.

a) not in conformity with an applicable V.) FOOD, DRUGS, COSMETICS AND


consumer product quality or safety standard DEVICES

b) declared as banned consumer product by DECLARATION OF POLICY – The State shall:


a rule in this Act;
a) ensure safe and good quality of food,
It shall likewise be unlawful to: drugs, cosmetics and devices; and
b) regulate their production, sale,
c) refuse access to or copying of pertinent distribution and advertisement to protect
records or fail or refuse to permit entry of or the health of the consumer.
inspection by authorized officers or
employees of the department; The principal implementing agency is the DOH,
who shall:
d) fail to comply with an order relating to
notifications of substantial product a) establish standards and quality
hazards and to recall, repair, replacement measures for food, drugs, devices and
or refund of unsafe products; cosmetics;

e) fail to comply with the rule prohibiting b) adopt measures to ensure pure and safe
stockpiling. supply of foods and cosmetics, and safe,
efficacious and good quality of drugs and
The Penalties for violating are as follows: devices in the Country;

For Natural Persons: c) adopt measures to ensure the rational


1.) Fines – not less than Php1,000.00 but not use of drugs and devices, such as, but not
more than Php10,000.00 limited to, banning, recalling or withdrawing

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from the market drugs and devices which are 5) if its container is composed, in whole or in
unregistered, unsafe, inefficacious or of part, of any poisonous or deleterious
doubtful therapeutic value, the adoption of substance which may render the contents
an official National Drug Formulary, and the injurious to health; or
use of generic names in the labeling of drugs;
6) if it has passed its expiry date.
d) strengthen the Food and Drugs
Administration (FDA, or formerly the Bureau Exceptions: The following shall not be
of Foods and Drugs). considered as adulterated foods:

DOES THE DEPARTMENT POSSESS QUASI- 1. if the quantity of the substance does not
LEGISLATIVE POWERS? ordinarily render it injurious to health.

Yes. In interest of promoting honesty and fair Tolerance for poisonous Ingredients in
dealing in the interest of the consumer, the Food, (Article 25) - if the poisonous
Department has power to promulgate Rules and substance is required or cannot be avoided
Regulations to fix and establish reasonable in its production or cannot be avoided by
definition and standard of IDENTITY, QUALITY, good manufacturing practice, the
AND FILL OF CONTAINERS for food, drugs, Department shall promulgate regulations
cosmetics or devices. limiting the quantity to such extent
necessary for the protection of public health.
A. PROVISIONS RELATING TO FOODS Any quantity exceeding the limits so fixed
shall be deemed to be unsafe.
WHEN ARE FOODS CONSIDERED
“ADULTERATED” ? Example: mercury substance in foods is not
considered deleterious to health if the
a.) Foods with Poisonous Or Deleterious quantity does not exceed of 1 part per million
Substance are adulterated when: (ppm).

1) if the food bears or contains any poisonous 2. a pesticide chemical in or on a raw


or deleterious substance which may render agricultural commodity;
it injurious to health;
3. a food additive;
2) if it consists in whole or in part of any filthy,
putrid or decomposed substance, or if it is Exceptions for Conformity with Regulation
otherwise unfit for food; of Unsafe Food Additives, (Article 26) - it the
intended use conforms to the terms of an
3) if it has been prepared, packed or held under exemption for being solely intended for
unsanitary conditions; investigational use by qualified experts; OR
the use is in conformity with a regulation
4) if it is, in whole or part, the product of a issued by the Department.
diseased animal or of an animal which has
died other than by slaughter; (examples: Note: Any person may file a Petition for
double dead meat, or meat of animals who Regulation of Food Additive (Article 27), with
died from swine flu.) the Department. The Department may
likewise promulgate this regulation an

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anytime on its own prerogative. This
regulation shall take effect fifteen (15) days c.) Foods with color additive:
after its publication in a newspaper of general
circulation. if it is, or bears or contains a color additive which
is unsafe under existing regulations: Provided,
4. a color additive, for which tolerances have That the Department shall promulgate
been established and it conforms to such regulations providing for the listing of color
tolerances. additives which are harmless and suitable for
use in food for which tolerances have been
b.) Foods with omitted or abstracted established;
constituent;
d.) Confectionary with non-nutritive substance
(Note: Constituents are substances that provide
nourishment of life and for growth, which are if it is confectionary, and it bears or contains any
classified as carbohydrates, proteins, fats, alcohol or non-nutritive article or substance
vitamins, minerals, fibers & waters.) except harmless coloring, harmless flavoring,
harmless resinous glass not in excess of four-
1) If any valuable constituent has been, in whole tenths (4/10) of one per centum (1%) natural gum
or in part, omitted or abstracted therefrom and pectin. This shall NOT apply to safe non-
and the same has not been substituted, by any nutritive article or substance.
healthful equivalent of such constituent;
e.) Oleomargarine, margarine or butter
Example: The sale of a canned tuna with 100g containing any filthy, putrid or decomposed
of “protein” in the packaging is deemed as substance, or unfit for food;
adulterated if the said protein has been
omitted or obstructed, without any substitute, f.) if it has not been prepared in accordance
which makes the actual quantity of protein with current acceptable manufacturing
below 100g. practice established by the Department
through regulations.
2) if any substance, not a valuable constituent,
has been added or substituted or in part WHO REGULATES UNPROCESSED FOOD?
therefor;
The provincial, municipal and city governments
Example: The sale of a canned tuna with 100g shall regulate the preparation and sale of meat,
of “protein” in the packaging is deemed as fresh fruits, poultry, milk, fish, vegetables and
adulterated if the said protein has been other foodstuff for public consumption, pursuant
substituted with a flour which is not a good to the Local Government Code.
protein source.
B) PROVISIONS RELATING TO DRUGS AND
3) if damage or inferiority has been concealed in DEVICES
any manner; or
WHEN ARE DRUGS CONSIDERED
4) if any substance has been added thereto or “ADULTERATED” ?
packed therewith so as to increase its bulk or
weight, reduce its quality or strength, or make a) Drugs containing filthy, putrid, or
it appear better or of greater value than it is. decomposed substances, etc.

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1) if it contains in whole or in part of any a) Drugs and devices which are, in
filthy, putrid, or decomposed substance accordance with the practice of the trade,
which may affect its safety, efficacy or to be processed, labeled or repacked in
good quality; or substantial quantities at
2) if it has been manufactured, prepared or establishments other than those where
held under unsanitary conditions originally processes or packed, on
whereby it may have been contaminated conditions that such drugs and devices
with dirt or filth or whereby it may have are not adulterated or mislabeled;
been rendered injurious to health; or
3) if its container is composed, in whole or b) Drugs intended for use by man which:
in part, of any poisonous or deleterious
substance which may render the (i) are habit-forming;
contents injurious to health; or (ii) because of their toxicity or other
4) if it bears or contains any color other than potentiality for harmful effect, or method
a permissible one as determined by the of their use is not safe for use except under
Department, taking into consideration the supervision of practitioner licensed by
standards of safety, efficacy or good law to administer such drug;
quality. (iii) are new drugs whose applications are
limited to investigational use .
b) If there is variance in the official
compendium of drugs and its strength WHAT ARE THE LICENSING AND
differs from, or its safety, efficacy, quality REGISTRATION REQUIREMENTS FOR DRUGS
or purity falls below the standards; AND DEVICES?

c) If it is not subject to the provisions of Any person may file with the Department an
paragraph (b) and its strength differs from, application containing:
or its efficacy, quality or purity falls below,
that which it purports or is represented to 1) full reports of investigations which have been
possess. made to show whether or not such drug or
device is safe, efficacious and of good quality
d) If a drug or device and any substance has for use based on clinical studies conducted in
been mixed or packed therewith, or any the Philippines;
substance has been substituted wholly or 2) a full list of the articles used as components
in part thereof, so as to reduce its safety, of such drug or device;
efficacy, quality, strength or purity. 3) a full statement of the composition of such
drug or device;
e) If the methods used in, or the facilities or 4) a full description of the methods used in and
controls used for its manufacture or the facilities and controls used for the
holding do not conform to or are not manufacture of such drug or device;
operated or administered in conformity 5) such samples of such drug or device and of
with current good manufacturing practice. the articles used as components thereof as the
Department may require;
WHAT ARE THE EXCEPTIONS FOR THE 6) specimens of the labeling proposed to be
LABELING AND PACKING REQUIREMENTS FOR used for such drug or device; and
DRUGS AND DEVICES?

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7) such other requirements as may be transferred, unless registered by the
prescribed by regulations. manufacturer, imported or distributor thereof,

The following are the summary of the licensing WHO HAS JURISDCITION FOR DANGEROUS
and registration procedure: DRUGS?

It is under the jurisdiction and authority of the


PDEA.
Filing of an Application under
ouath BANNED OR RESTRICTED DRUGS:

Banned or severely restricted drugs for health and


safety reasons in their country of origin shall be
Within 180 days, the
Department shal either
banned and confiscated here in the Philippines
approve, deny or five applicant
opportunity to be heard by the Department.

The Department shall monitor the presence in


the market of such drugs and cause the
Issuance of Licence or
registration in approved, or
Issuance of Order of
maintenance and regular publications of an
Disapproval for applications
usbmitted to a hearing updated consolidated list thereof.

CERTIFICATION OF CERTAIN DRUGS

The Department shall, by regulations, provide for


Registration shall be subject to fees. the certification of batches of drugs composed
wholly or partially of any kind of antibiotic. A batch
WHAT IS THE EFFECT IF YOU FAIL TO COMPLY of such drug shall be certified if such drug has
WITH THE LICENCING AND REGISTRATION such characteristics of identity, strength,
REQUIREMENTS? quality and purity, as the Department prescribes

1.) FAILURE TO FILE APPLICATION UNDER OATH: The term "antibiotic drug" means any drug
No person shall manufacture, sell, offer for intended for use by man containing any quantity
sale, import, export, distribute or transfer any of any chemical substance which is produced by
drug or device, unless an application is filed a micro-organism and which has the capacity to
with the Department. inhibit or destroy micro-organisms in dilute
solution (including the chemically synthesized
2.) FAILURE TO SECURE LICENCE TO OPERATE: equivalent of any such substance).
No person shall manufacture, sell, offer for
sale, import, export, distribute or transfer any The department may likewise promulgate
drug or device without first securing a license regulations exempting such drug or class of drugs
to operate from the Department from such requirements with respect to any drug
or class of drugs are not necessary to insure
3.) FAILURE OF THE MANUFACTURER, IMPORTER safety and efficacy of use and good quality
OR DISTRIBUTOR TO REGISTER No drug or
device shall be manufactured, sold, offered for C) PROVISIONS RELATING TO COSMETICS
sale, imported, exported, distributed or

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WHEN ARE COSMETICS CONSIDERED establishment or vehicle and all pertinent
“ADULTERATED” ? equipment, finished and unfinished materials,
containers and labeling therein.

a) Drugs which bears or contains any poisonous RIGHT TO OBTAIN SAMPLES - During the
or deleterious substance which may render it inspection process, the representatives may
injurious to users. This shall NOT apply to color obtain “samples”, provided that the inspector
additive hair dye. provides the owner, operator, or agent in charge
a receipt describing the samples.
b) If consists in whole or in part of any filthy,
putrid, or decomposed substance. The result of the analysis conducted for the
samples taken shall be promptly provided to
c) if it has been prepared, packed or held under owner, operator or agent in charge.
unsanitary conditions whereby it may have
become contaminated with filth, or injurious to WHAT HAPPENS IF THE DEPARTMENT ISSUES
health. SUSPENSION AND REVOCATION OF
PROVISIONAL PERMITS, PURSUANT TO
d) if its container contains of any poisonous or PROMULGATED REGULATIONS?
deleterious substance;
Whenever the Department finds, after
e) if it is not a hair dye, and it bears or contains investigation, that the sale or distribution in
color additive other than which is permissible. commerce of any class of food, cosmetics,
drugs or devices, may be injurious to health, it
f) if any of its substances has been (1) mixed or shall promulgate regulations providing for the
packed therewith so as to reduce its quality or issuance, suspension and revocation of
strength or (2) substituted wholly or in parts provisional permits,
therefor.
After the effective date of such regulations, and
FACTORY INSPECTION OF FOODS, DRUGS during such temporary period, no person shall,
AND DEVICES AND COSMETICS: offer for sale or transfer any such food,
cosmetics, drugs or devices unless such
Any authorized officers or employees of the manufacturer, processor or packer holds such
Department exercise the following: permit.

RIGHT OF ENTRY - enter, at reasonable hours, PUBLICITY AND PUBLICATION


any factory, warehouse or establishment in
which food, drugs, devices or cosmetics are The Department my cause to be disseminated
manufactured, processed, packed or held, for information regarding food, drugs, devices, or
introduction into domestic commerce or are cosmetics in situations involving, in the opinion
held after such introduction, or to enter any of the Department, imminent danger to health,
vehicle being used to transport or hold such or gross deception to the consumer. Nothing
food, drugs, devices, or cosmetics in domestic in this Article shall be construed to prohibit the
commerce; and Department from collecting, reporting, and
illustrating the results of its investigations.
RIGHT TO INSPECT – to inspect, in a reasonable
manner, such factory, warehouse, or

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The Department shall publish a Drug Reference
Manual and Drug Bulletin to serve as reference i) the use, in labeling, advertising or other sales
by manufacturers, distributors, physicians, promotion, of any reference to any report or
consumers and such other groups as may be analysis furnished in compliance with Section
deemed necessary. 19 of Executive Order 175, series of 1987;

WHAT ARE THE PROHIBITED ACTS AND j) the manufacture, importation, exportation,
PENALTIES FOR FOODS, DRUGS AND sale, offering for sale, distribution, or transfer of
DEVICES AND COSMETICS? any drug or device which is not registered with
the Department pursuant to this Act;
a) the manufacture, importation, exportation,
sale, offering for sale, distribution or transfer of k) the manufacture, importation, exportation,
any food, drug, device or cosmetic that is sale, offering for sale, distribution, or transfer of
adulterated or mislabeled; any drug or device by any person without the
license;
b) the adulteration or misbranding of any food,
drug, device or cosmetic; l) the sale or offering for sale of any drug or
device beyond its expiration or expiry date;
c) the refusal to permit entry or inspection;
m) the release for sale or distribution of a batch
d) the giving of a false guaranty or undertaking of drugs without batch certification when
required.
e) forging, counterfeiting, simulating, or
falsely representing or without proper authority The PENALTIES for violating are as follows:
using any mark, stamp, tag, label, or other
identification device authorized or required by For Natural Persons:
regulations; 1.) Fines – not less than Php5,000.00 but not
more than Php10,000.00
f) the using of any information concerning any 2.) Imprisonment – not less than 1 year but
method or process which as a trade secret is not more than 5 years;
entitled to protection (except disclosure to the 3.) Fines and Imprisonment – upon
Department or Court); discretion of the Court.

g) the alteration, mutilation, destruction, For Juridical Entities:


obliteration, or removal of the whole or any
part of the labeling of, or the doing of any other 1.) Penalties as prescribed above – to be
act with respect to a food, drug, device, or imposed upon any board director,
cosmetic, if such act is done while such product president, or general manager, or the
is held for sale (whether or not the first sale) and partners of a corporation /partnership
results in such product being adulterated or who directly responsible
mislabeled;
EXEMPTIONS FROM LIABILITY:
h) False representation or suggestion that an
application with respect to such drug is 1.) No person shall be subject to the penalties if
effective or that such drug complies with the the delivery was made in good faith. This
registration and licensing requirements. ; exception will not apply if he refuses to

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furnish on request of the Department, the WHAT ARE THE ACTIONS THAT THE
name and address of the person from whom DEPARTMENT MAY PERFORM AFTER THE
he purchased or received such product and EXAMINATION OF THE HAZARDOUZ
copies of all documents; SUBSTANCE?

2.) A person shall not likewise be liable if he 1) ADMIT – if NOT mislabeled or banned
provides guaranty or undertaking signed hazardous substance.
by, and containing the name and address of,
the person residing in the Philippines from 2) RELABEL - If it appears that the hazardous
whom he received in good faith the product substance can, by relabeling or other action
which are adulterated or mislabeled. made to comply with the requirements, be
deferred pending the final determination of
3.) A person shall not likewise be liable if the the admission upon filing of application and
product is adulterated by reason of posting of bond.
containing a color other than the
permissible one under regulations, if such 3) REFUSE ADMISSION AND EXPORTATION – if
person establishes a guaranty or it shown that If it appears from the
undertaking signed by, and containing the examination of such samples that such
name and address, of the manufacturer of hazardous substance is a mislabeled
the color, to the effect that such color is hazardous substance or banned hazardous
permissible, under applicable regulations substance.

VI.) HAZARDOUS SUBSTANCE 4) DESTRUCTION - the Commissioner of


Customs shall cause the destruction of any
DECLARATION OF POLICY: State shall adopt hazardous substance refused admission
measures designed to protect the consumer unless such is exported.
against substances other than food, drugs,
cosmetics and devices that are hazardous to his WHAT ARE THE PROHIBITED ACTS AND
health and safety. PENALTIES FOR HAZARDOUZ SUBSTANCE?

The principal implementing agency shall be the a) introduce or deliver for introduction into
DOH. commerce of any mislabeled hazardous
substance or banned hazardous substance;
WHAT ARE THE RULES RELATING TO THE
IMPORATION OF HAZARDOUZ SUBSTANCE? b) alter, mutilate, destroy, obliterate or remove
the whole or any part of the label of a mislabeled
The Commission of Customs shall deliver to the hazardous substance, or banned hazardous
DOH, upon request, samples of hazardous substance, while held for sale;
substance being imported in the Philippines.
c) receive in commerce any mislabeled
During the pendency of the examination of the hazardous substance or banned hazardous
samples, the Commissioner of Customs may substance and the delivery or preferred delivery
authorize the delivery of the hazardous substance thereof at cost or otherwise;
to the owner or consignee upon posting of good
and sufficient bond. d) give the false guaranty or undertaking;

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e) introduce or deliver for introduction into a) interest or time price differential and any
commerce or receive in commerce and amount payable under point or other system of
subsequently deliver or preferred at cost or additional charges;
otherwise, or a hazardous substance in a reused
food, drug, cosmetic or device container or in a b) collection fees which include finder's fees or
container which, though not a reused container, similar charges;
is identifiable as a food, drug, cosmetic or device
container by its labeling or by other identification. c) credit investigation fees;

For Natural Persons: d) notarial fees, if any;


1.) Fines – not less than Php1,000.00
2.) Imprisonment – not less than 6 months e) premium or other charges for any guarantee or
but not more than 5 years; insurance protecting the creditor against the
3.) Fines and Imprisonment – upon obligor's default or other credit loss. The
discretion of the Court. implementing agency shall determine what items
shall be exempted from the computation of the
EXEMPTION FROM LIABILITY: finance charges.

If he establishes a guaranty or undertaking WHAT ARE THE OTHER CHARGCES THAT MAY
signed by, and containing the name and address COLLECTED FROM A CONSUMER OF CREDIT?
of, the person from whom he received in good
faith, the hazardous substance to the effect that In addition this finance charges, the following
the hazardous substance is not a mislabeled may likewise be collected against a consumer of
hazardous substance or banned hazardous credit:
within the meaning of that term in this Act.
Delinquency Charges - the parties may agree to
VII.) CONSUMER CREDIT TRANSACTION: a delinquency charge on any installment not paid
in full on or before the tenth day after its
DECLARATION OF POLICY: The State shall scheduled or deferred due date. This is not
simplify, clarify and modernize the laws governing applicable to open-credit plant.
credit transactions and encourage the
development of fair and economically sound Deferral Charges - The parties in a consumer
consumer credit practices. To protect the credit transaction may at any time agree in writing
consumer from lack of awareness of the true cost to a deferral of all or part of one or more unpaid
of credit to the user, the State shall assure the full installments and the creditor may make and
disclosure of the true cost of credit. collect a charge which shall not exceed the rate
previously disclosed pursuant to the provisions
WHAT ARE FINANCE CHARGES? on disclosure. A deferral charge may be collected
at the time it is assessed.
The sum of all charges, payable directly or
indirectly by the person to whom the credit is Finance Charge on Refinancing - The parties
extended and imposed directly or indirectly by the may agree on a finance charge in an open-end
creditor as an accident to the extension of credit, credit plan based on the amount financed
including any of the following type of charges resulting from the refinancing or consolidation at
which are applicable: (I.C.C.N.P) a rate not exceeding that permitted by the rules
promulgated by the implementing agency.

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12 equal monthly installments, with pre-
WHAT ARE THE RIGHTS OF A CONSUMER OF computed finance charges (interest) of 30% of the
CREDIT? total principal loan or Php3,600, for the whole
obligation.
A consumer of credit has a right to:
The finance charge of Php3,600.00 can be
Prepay - The person to whom credit is extended rebated if there’s prepayments prior to the due
may prepay in full or in part, at any time without date of the installment, subject to the rules of
penalty, the unpaid balance of any consumer 78s.
credit transaction.
If the first installment is due on January 1, 2024
Rebate - Upon prepayment in full of the unpaid and A prepays on the 2nd month of installment
balance of a precomputed consumer credit (FEB), the he shall be entitled to the rebate of the
transaction, refinancing or consolidation, an unearned interest charge, while LOAN SHARK
amount not less than the unearned portion of the shall be entitled to the earned interest.
finance charge calculated according to this
Article shall be rebated to the person to whom # Month Earned Unearned %Rebate
credit is extended. Units Units
12 Jan 12/78 66/78 84.62%
Example: 11 Feb 23/78 55/78 70.52%
10 Mar 33/78 45/78 57.69%
A has obtained a loan from Loan Sharkamounting 09 Apr 42/78 36/78 46.15%
to Php10,000.00 which is payable on 5 equal 08 May 50/78 28/78 33.90%
monthly installments, with pre-computed 07 Jun 57/78 21/78 26.92%
interest amounting to Php500. The first 06 Jul 63/78 15/78 19.23%
installment is due on November 1, 2024. 05 Aug 68/78 10/78 12.82%
04 Sep 72/78 6/78 07.69%
Under the law, A has the right to prepay, meaning 03 Oct 75/78 3/78 03.85%
he can pay the whole obligation including the 02 Nov 77/78 1/78 01.28%
precomputed interest or finance charge prior
01 Dec 77/78 0/78 00.00%
to November 1, 2024.
In this case, since there is prepayment on the
Consequently, If he paid the whole obligation in
second month, A is entitled to received 70.52% of
advance, including interest, he shall likewise be
rebate.
entitled to rebate of the settled pre-computed
interest charges amounting to Php500.
NOTE: If the payment is made AFTER THE 15TH
DAY OF THE MONTH, it shall be considered to
HOW TO COMPUTE THE REBATE?
have been made on the succeeding installment.
The "rule of 78" or "sum of the digits" method is
Example, in the given problem above, if A paid on
used in calculating rebate.
23rd February 2024, the computation of the rebate
shall be based on the March installment, not
Example:
February.
A has obtained a loan from LOAN SHARK
amounting to Php12,000.00 which is payable on

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WHAT ARE REQUIREMENTS FOR a) the conditions under which a finance charge
DISCLOSURES: may be imposed, including the time period, if any,
within which any credit extended may be repaid
General Requirement on Credit Cost without incurring a finance charge;
Disclosure – the credit is required to disclose the
following to the consumer of credit: b) the method of determining the balance upon
which a finance charge may be imposed;
• For Credit Sales – or sale transactions with a
promise to pay on a later date. c) the method of determining the amount of the
finance charges, including any minimum or fixed
a) the cash price or delivered price of the property amount imposed as a finance charge;
or service to be acquired;
d) where one or more periodic rates may be used
b) the amounts, if any, to be credited as down to compute a finance charge, each such rate, the
payment and/or trade in; range of balances to which it is applicable, and
the corresponding simple annual rate;
c) the total amount to be financed or the
difference between the amounts set forth under e) the conditions under which the creditor may
paragraphs (1) and (2); impose a security lien and a description of the
goods to which such lien may attach.
d) the charges, individually itemized, which are
paid or to be paid by such person in connection • For Open-end Credit Plan –, loans payable
with the transaction but which are not incident to on a definite due date. Example house of car
the extension of credit; loans.

e) the finance charge expressed in terms of pesos a) the amount of credit of which the debtor will
and centavos; have the actual use, or which is or will be paid to
him or for his account or to another person on his
f) the percentage that the finance charge bears to behalf;
the total amount to be financed expressed as a
simple annual rate on the outstanding balance of b) all charges, individually itemized, which are
the obligation; included in the amount of credit extended but
which are not part of the finance charge;
g) the effective interest rate;
c) the total amount to be financed or the sum of
h) the number, amount and due dates or periods the amounts referred to in paragraphs (a) and (b);
of payments scheduled to repay the
indebtedness; and d) the finance charge expressed in terms or pesos
and centavos;
i) the default, delinquency or similar charges
payable in the event of late payments. e) the effective interest rate;

• For Open-end Credit Plan – loan agreement f) the percentage that the finance charge bears to
with no definitive due date, such credit cards. the total amount to be financed expressed as a
simple annual rate on the outstanding unpaid
balance of the obligation;

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- description of the property sold and a
g) the default, delinquency or similar charges description of any property transferred as
payable in the event of late payments; a trade-in.

h) a description of any security interest held or to In addition, the instrument should likewise
be held or to be retained or acquired by the contain a clear and conspicuous typewritten
creditor in connection with the extension of credit notice to the person to whom credit is being
and a clear identification of the property to which extended that:
the security interest relates.
a) he should not sign the instrument if it
NOTES: contains any blank space;

- All of these disclosures shall be made b) he is entitled to a reasonable return of


clearly and conspicuously in writing the precomputed finance charge if the
before the transaction is consummated. balance is prepaid; and
- The creditor shall likewise provide a
Periodic Statement of Charges c) he is entitled to an exact, true copy of
containing the simple annual rate, the agreement.
effective interest rate, due date, and
method of determining the balance. In cases where the instrument will be sold at a
discount to a bank, financing company or other
WHAT ARE THE EXEMPT TRANSACTIONS? lender, the said transferee shall be subject to all
claims and defenses which the debtor could
a) those involving extension of credits for assert against the seller of consumer products
business or commercial purposes, or to the obtained hereto or with the proceeds thereof.
Government and governmental agencies and
instrumentalities, juridical entities or to Penalties:
organizations;
Any person violating the disclosure requirements
b) those in which the debtor is the one shall be liable to such person in the amount of
specifying the definite set of credit terms such One thousand pesos (P1,000.00) or in amount
as bank deposits, insurance contracts, sale of equal to twice the finance charge required by
bonds or analogous transactions. such creditor in connection with such
transaction, whichever is greater, except that
INSTRUMENT EVIDENCING THE SALE OF such liability shall not exceed Three thousand
CONSUMER PRODUCTS IN INSTALLMENT pesos (P3,000.00) for any credit transaction and
PAYMENT: actual damages with the non-disclosure of the
required information.
Formalities: The instrument evidencing the
transaction shall contain the: Action to recover such penalty may be brought by
- signature of the seller such person within one (1) year from the date of
- signature of person to whom credit is the occurrence of the violation in any court of
extended, competent jurisdiction.
- the date it was signed,

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VIII.) NATIONAL CONSUMER AFFAIRS to comply with the established priorities,
COUNSIL: standards and guidelines;

Composition: The Council shall be composed of d) to seek the assistance of government


representatives from the following government instrumentalities in the form of
agencies and non-government agencies: augmenting the need for personnel
facilities and other resources;
a) Department of Trade and Industry;
e) to undertake a continuing education
b) Department of Education, Culture and and information campaign to provide
Sports; the consumer with, among others;

c) Department of Health; 1) facts about consumer products and


services;
d) Department of Agriculture;
2) consumer rights and the mechanism
e) four (4) representatives from consumer for redress available to him;
organizations of nationwide base to be
chosen by the President from among the 3) information on new concepts and
nominees submitted by the various developments on consumer protection;
consumer groups in the Philippines; and

f) two (2) representatives from 4) general knowledge and awareness


business/industry sector to be chosen by necessary for a critical and better
the President from among the nominees judgment on consumption;
submitted by the various business
organizations. 5) such other matters of importance to
the consumer's general well-being.
POWERS AND FUNCTIONS:
OTHER POWERS AND FUNCTIONS:
a) to rationalize and coordinate the
functions of the agencies charged with 1.) Consumer Education in Schools. – The
consumer programs and enforcement of Department of Education, Culture and
consumer related laws to the end that an Sports, with the cooperation and advice of
effective, coordinated and integrated the Council, shall develop and adopt a
system of consumer protection, research consumer education program which shall
and implementation and enforcement of be integrated into existing curricula of all
such laws shall be achieved; public and private schools from primary to
secondary level
b) to recommend new policies and 2.) Consumer Participation. – The
legislation or amendments to existing Departments shall establish procedures
ones; for meaningful participation by consumers
or consumer organizations in the
c) to monitor and evaluate development and review of department
implementation of consumer programs rules, policies and programs
and projects and to take appropriate steps

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3.) Advisory Services. – The departments
shall render advisory services upon
request. The technical and legal
assistance shall be made available to
consumers and their organizations and to
the general public.
4.) Consumer Program Reforms. – Each
concerned Department shall formulate
and develop a consumer program
consonant with the objectives of its
charter or the applicable laws which
program shall embody the standards set
forth in Sections 156 and 157 of this Act.

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