With the Internet becoming the modern marketplace for an increasing number of Filipinos, do our existing laws provide enough protection for the growing online consumers?
This crossed my mind after sifting through the latest European Union (EU) directive for one of the courses in my program.
In EU parlance, a directive is a legislation that lays down certain objectives that have to be achieved by member states, usually related to the union’s goal of keeping a single market. The 27 EU member states have to adapt the legislation into their national laws, but are still given flexibility on how to incorporate legislation into their laws.
The Directive 2011/83 EU on consumer rights came into force in December last year. It is an amendment to earlier directives and in which EU member states are given a year or this year to incorporate the recommended rules into their national legislation.
Although it has been described that this is a “watered-down” version of the first proposal made three years ago, in my view it still offers stronger protection for online consumers and has effectively addressed some pressing issues related to Internet commerce.
The term “digital content” was mentioned for the first time in this directive that is defined as “data which are produced and supplied in digital form.” It also assumes that every electronic commerce or any transaction made on the Internet is a form of a distant contract.
The directive requires more transparency from traders and seeks to eliminate hidden transaction costs. The particular provision must have foremost the airlines and their ubiquitous promotional offers in mind.
According to the directive, traders must in a “clear and comprehensible manner” inform a would-be consumer about the “total price of the goods or services inclusive of taxes, or where the nature of the goods or services is such that the price cannot reasonably be calculated.”
In addition, a consumer has a period of 14 days to withdraw from a distance contract “without giving any reason and without incurring any costs.” This was an amendment from the earlier seven-day purchase refund period.
For convenience, the directive asks a trader to attach a “withdrawal form” to the package that is set for delivery to the buyer. I find this provision particularly fascinating, as I have never encountered this practice while in the country.
Said to originate from Scandinavia, the model withdrawal form makes the option for withdrawing from a sales contract easier and faster for consumers. All the consumer needs to do is fill in the form and send it back to the trader.
In case a trader missed to provide a consumer with the information on the right of withdrawal, the withdrawal period will be extended to 12 months from the end of the initial withdrawal period. Within this period, if the trader has provided the information, the withdrawal period will expire 14 days upon the notification.
Exceptions from the right of withdrawal include, among others, sealed audio or sealed video recordings or sealed computer software, which were opened after delivery and the supply of digital content “which is not supplied on a tangible medium” such as music bought online.
Already, Philippines has the Republic Act No. 7394 or the Consumer Act and the Republic Act 8792 or the Electronic Commerce Act of 2000, both aimed at protecting Filipino consumers. It would not hurt to consider updating these laws to keep up with the evolving consumer practice.
Online purchase, for sure, is poised to become a big business. As of end of last year, research company Nielsen estimated internet users in the country at 33.6 million or about 33 percent of the total population. In no time, the figure can balloon and as a result this will elevate the need for a stronger protection for online consumers.
Maricel is currently attending an LL.M. Program in Intellectual Property and Competition Law at the Munich Intellectual Property Law Center — our direct connection to Europe’s technology scene, and an international point of view of the Intellectual Property Law. You can reach her by e-mail at email@example.com