Published 19 October 2018, The Daily Tribune
Are you one of those storeowners who ordinarily run out of small bills and coins and as a result, offer candies to customers as change? You probably have to think twice now.
Under Republic Act No. 10909, all business establishments are required to give the exact amount of change to the consumers. They should not shortchange, which is defined as the act of giving insufficient or no change to a consumer who purchased a product or service, even if such change is only of a small amount. They also cannot give other forms of change like candy in lieu of monetary change. But if they so desire, nothing prohibits them from giving an amount greater than the exact change.
This becomes more relevant nowadays when most people get into business to make a living. The prohibition on shortchanging applies to almost all types of businesses. In particular, business establishment pertains to any person, natural or juridical, whether single proprietorship, partnership or corporation, engaged in, or doing business in the Philippines, including government-owned and – controlled corporations (GOCCs) and government entities exercising proprietary functions. It applies also to informal and unregistered businesses, and those selling goods or providing services regularly in a permanent place or stall or moving from one place to another such as, but not limited to, ambulant vendors, peddlers, pedicabs, tricycle, e-trikes, “tiangge”.
To institutionalize the industry practice of giving exact change to consumers, RA No. 10909 imposes certain duties on the part of the establishment. Under the law, the business establishment shall give exact amount of change to the consumer without waiting for the consumer to ask for the same. The cashier or staff clerk or their equivalent, shall count the change in front of the consumer and place the same on the hand of the consumer or on the change tray, whichever is applicable. To add further measure of protection to consumers, business establishments are also mandated to post notices in every counter to ensure/remind their cashiers to give exact amount of change e.g. “Please demand for your exact change” or any language or literature to such effect.
In order that consumers will know the exact price of the goods as well as the change that they should receive, the law also requires establishments to use price tags, when appropriate, indicating the exact retail price per unit or service, which already includes the taxes applicable to the goods or services being offered. In addition, they should also issue Official Receipts or Sales Invoices, as may be applicable, to the consumers.
On the other hand, the consumers must ensure that exact amount of change is received immediately after every transaction. If not, any aggrieved consumer may report to the business establishment’s consumer welfare desk all instances of short changing for immediate action/remedy. He may also write and submit a letter of complaint to the Department of Trade and Industry (DTI) not later than ten (10) working days after a violation has been committed. Failure to submit the letter of complaint within the prescribed time shall be a ground for the dismissal of the complaint.
If the establishment was found to have violated the law, it shall pay PhP500.00 or three percent (3%) of the gross sales of the business establishment on the day of the violation, whichever is higher, for first offense. For second, third and fourth offenses, it shall pay the fine of PhP5,000.00 of five percent (5%) of gross sales, PhP15,000.00 or seven percent (7%) of gross sales, and PhP25,000.00 or ten percent (10%) of gross sales, respectively. In addition to the fines, the total amount of change the establishment failed or refused to give, as determined from the audit of DTI, shall be paid by the said establishment to the complainant. The DTI may likewise recommend the suspension and revocation of the license to operate of frequent offenders.
So to avoid fines and penalties, make sure that your consumer’s change is coming!
For comments and questions, please send email to cabdo@divinalaw.com
