Given the numerous potential for opportunities that the use of digital technologies can offer, it is not surprising that businesses are eager to use them in their operations. But, in order to successfully reap the benefits of these digital technologies, there is a need to navigate a complex legal landscape to ensure compliance and mitigate risks, as failure to adhere to these laws can result in significant financial penalties, reputational damage, and legal liabilities.
This article aims to shed light on the roles of digital, cyber, and technology laws in navigating a data-centric marketplace. By understanding the legal requirements and leveraging them strategically, businesses can transform compliance into a competitive advantage.
Add to Cart: The Evolution of Digital Transactions
Even more than a decade ago, some businesses had started to use digital technology in their operations. At the heart of this digital evolution is Republic Act No. 8792 or the “Electronic Commerce Act”, enacted last 19 June 2000, which “aims to facilitate domestic and international dealings, transactions, arrangements, agreements, contracts and exchanges and storage of information through the utilization of electronic, optical and similar medium, mode, instrumentality and technology to recognize the authenticity and reliability of electronic documents related to such activities and to promote the universal use of electronic transaction in the government and general public.”
However, since the COVID-19 pandemic causing people to stay holed up in their homes, this use has grown exponentially. According to the International Trade Administration, the Philippines had seventy three (73) million online active users in the year 2021 alone. These users largely contributed to a market sale of $17 billion, with an estimated growth of 17% by the year 2025. The Philippines is also considered as “the fastest-growing app market in Southeast Asia” in terms of mobile e-commerce, recording around 159 million mobile subscribers in 2022.
In order to adapt to these changes in the digital landscape since the enactment of the Electronic Commerce Act, Republic Act No. 11967 or the “Internet Transaction Act of 2023”, was signed by the President on 5 December 2023. In this new law, the State aims to “guarantee effective regulation of e-commerce to protect consumer rights and data privacy, encourage innovation, promote competition, secure internet transactions, uphold intellectual property rights, ensure product standards and safety compliance, and observe environmental sustainability.”
PM for Details: Online Business Do’s and Don’ts
One trickle effect of the pandemic is the issuance of Joint Administrative Order (JAO) No. 22-01, series of 2022, aimed to “increase consumer confidence in business-to-consumer (B2C) and business-to-business (B2B) e-Commerce transactions. It seeks to ensure that e-Commerce platforms, electronic retailers (e-retailers), and online merchants are properly guided about the rules, regulations, and responsibilities in the conduct of their online business, considering the need to protect consumers against deceptive, unfair, and unconscionable sales acts and practices.” The JAO also tries to ensure that online consumers know their rights and existing mechanisms for redress.
Under the JAO, online businesses are held responsible in the conduct of their businesses, and must comply with Philippine laws, rules and regulations. Just to name a few, online businesses are reminded of the following:
- Title III of the New Civil Code and the Republic Act No. 7394 or otherwise known as the “Consumer Act of the Philippines”, in relation to consumer product and services warranty.
- Article 81 and 83 of the “Consumer Act of the Philippines”, in relation to price tag placement.
- Republic Act No. 9711 or otherwise known as the “Food and Drug Administration (FDA) Act of 2009” and the “Consumer Act of the Philippines”, in relation to labeling requirements.
- Republic Act No. 4109 or otherwise known as the “Standards Law”, including compliance to all Department Administrative Orders issued by the Department of Trade and Industry that ensures and certifies product quality and safety.
- Article 50 of the “Consumer Act of the Philippines”, and Republic Act No. 8293 or otherwise known as the “Intellectual Property Code of the Philippines”, specifically Sections 155.1, 155.2, and 165.2(b), both of which declare as a violation deceptive acts or practices by a seller or supplier in connection with a consumer transaction.
Online businesses are also prohibited from producing, importing, distributing, marketing, selling, or transporting prohibited goods or services, which are those specifically prohibited under the law. These items include, but are not limited to, counterfeit goods and products, precious metals and conflict minerals, weapons, artifacts, sexual services, seditious or treasonous materials, and other such goods and services.
More than Terms and Conditions: Navigating Legal Requirements and Compliance
In an era where the internet has become a part of everyday life, it is not a stretch to say that information is at our fingertips..However, with that ease also comes the risk of our information, especially those that are personal, being used for the wrong purpose.
Foreseeing this development, the Philippines enacted the Republic Act No. 10173 or otherwise known as the “Data Privacy Act of 2012”, which aims to protect the fundamental right of privacy of communication while ensuring the promotion of innovation and growth. The passage of this law made data processing consent-based, with the JAO No. 22-01, series of 2022, specifying the responsibilities of online sellers, merchants, or e-retailers of informing their consumers of their data privacy rights.
Just short of a month after the enactment of the “Data Privacy Act of 2012”, another law, Republic Act No. 10175 or otherwise known as the “Cybercrime Prevention Act of 2012” was enacted. This law focuses on preventing and prosecuting cybercrimes, like those that violate privacy, confidentiality, and integrity of computer data systems, computer-related offenses, and content-related offenses. In line with this, businesses are now expected to be responsible for the information they collect from their consumers, considering the increasing cybercrime-related incidents such as phishing scams, cyber squatting, and identity theft.
Conclusion
Undoubtedly, data protection has become an important concern for businesses in the digital age, mainly due to the shift of consumer preference on digital platforms and the ever-increasing regulations that govern its handling. Non-compliance with these data protection laws can lead to several legal consequences, financial losses, and damage to the business’ reputation. These consequences make data protection not merely something that should be considered as a compliance requirement, but is now a fundamental part of responsible business practices, which should be given more importance and investment.
About the Author
Atty. Nickha Shanen Tupa
A driven and focused young lawyer who specializes in business litigation. With a keen eye for detail and a strategic mindset, Nickha is adept at representing clients in a wide range of commercial disputes, from contract disagreements to shareholder conflicts. She approaches each case with a determination to protect her clients’ interests and achieve favorable outcomes through negotiation, mediation, or litigation when necessary. Nickha’s commitment to delivering results, combined with her strong advocacy skills, has earned her a reputation as a formidable opponent in the courtroom and a trusted advisor for businesses navigating legal challenges.
