Enterprises are advised to be well-informed about the recently signed Internet Transactions Act (ITA), which seeks to protect both online consumers and merchants engaged in digital transactions.
Janette Toral, an e-commerce advocate and internet marketing specialist, in a recent webinar highlighted the importance of entrepreneurs becoming well-acquainted with the provisions of the ITA.The ITA—also known as Republic Act (RA) No. 11967 entitled “An Act Protecting Online Consumers and Merchants Engaged in lnternet Transactions, Creating for this Purpose the Electronic Commerce Bureau”—was signed by President Ferdinand Marcos Jr. on 5 December 2023.
RA 11967 mandates that all e-commerce participants using the Philippine market are subject to Philippine laws, regardless of their physical presence in the country. The law applies to all business-to-business (B2B) and business-to-consumer (B2C) internet transactions, excluding online media content and consumer-to-consumer (C2C) transactions.
The newly minted regulation also establishes the E-Commerce Bureau (ECB) under the Department of Trade and Industry (DTI), an online business database, and an e-commerce Philippine Trustmark for safety and security in internet transactions.
The DTI will spearhead the implementation of the law, as well as the Electronic Commerce Act of 2000 and the Philippine E-Commerce Roadmap.The ITA also empowers DTI to take appropriate actions in response to any violation of the law’s provisions, particularly in the use of the internet for conducting e-commerce by e-marketplaces, online merchants, e-retailers, digital platforms, and third-party platforms.
It also provides for the establishment of an online dispute resolution mechanism for all stakeholders involved in internet or e-commerce transactions.
Toral said worth waiting for is the issuance of the Code of Conduct.
Under RA 11967, the DTI, after consulting other relevant government agencies, “shall provide a Code of Conduct for all businesses engaged in e-commerce consistent with international trends, developments, standards, and best practices….”RA 11967 lays down the rights, obligations, and liabilities of the parties in internet transactions, including the online consumer, online merchant, and the digital platform or e-marketplace.Toral welcomed the fact that the law also seeks to protect the rights of online sellers, not just those of the consumers.
In an opinion piece posted online, Toral said the ITA recognizes consumers’ right to access information about the products or services they are purchasing, including details about the seller, product descriptions and prices.
They also have the right to seek redress for any issues or disputes related to internet transactions through the ECB.Both local and foreign digital platforms and online merchants are obligated to register with the ECB.
The Act imposes liabilities on electronic marketplaces and digital platforms, making them subsequently liable with an online merchant to the consumer for the damages suffered as a direct result of the transaction.
They may also be held civilly and administratively liable for failing to comply with the obligations set forth by the code of conduct.Penalties may be imposed on both natural and juridical entities that violate the Act and all rules, regulations, and standards promulgated. The penalties may include hefty fines as well as the suspension or revocation of permits issued.
The ITA has five chapters that tackle the following: general provisions; the e-commerce bureau; authority of DTI; rights, obligations, and liabilities of parties in internet transactions; and final provisions (damages and penalties for violations).
The Act takes effect tomorrow, 20 December, 15 days following its publication in the official gazette.
The law will be implemented within 90 days of its effectivity, with an 18-month transition period for all affected online businesses to comply.
