RA 10909 - No Shortchanging Act

No Shortchanging Act R.A. 10909

Why your store should give exact change

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Why Compliance is Necessary?Non-compliance will expose offenders to these penalties:

1. Fine a) 1st Offense – P500.00 or 3% of gross sales of the business establishment on the day of the violation, whichever is higher;

b) 2nd Offense – P5,000.00 or 5% of gross sales of the business establishment on the day of the violation, whichever is higher;

In addition, the total amount of change the establishment failed or refused to give, as determined from the audit of the DTI, shall be paid by the establishment to the complainant.

c) 3rd Offense – P15,000.00 or 7% of gross sales of the business establishment on the day of the violation, whichever is higher, and the license to operate of the business estab-lishment shall be suspended for 3 months;

d) 4th Offense – P25,000.00 or 10% of gross sales of the business establishment on the day of the violation, whichever is higher, and the license to operate of the business estab-lishment shall be revoked;


Who are Covered?Business establishment – any person, natural or juridical, whether single proprietorship or corporation, including a govern-ment-owned and –controlled corporation or a government entity exercising its proprietary functions, engaged in, or doing business in the Philippines, either in selling goods or providing services.

Consumer – a natural person who purchases goods or services in cash;


Things to NoteGoods – all types of tangible property that could be bought and sold, and the possession of which could be transferred in whole or in part, temporarily or per-manently;

Services – all types of commercial activities which enable the supply, access to, consumption or use of goods, intellectual property or other services; and

Shortchange – the act of giving insufficient or no change to consumer who pur-chased a product or service.

It is the duty of the establishment to give the exact change to the consumer “without waiting for the consumer to ask for the same.”


What are Prohibited under the Law?General Prohibition:

It shall be unlawful for any business establishment “to shortchange a consumer, evenif such change is only of a small amount.”

However, establishments are not precluded from giving “an amount greater than the sufficient change.”


What are Prohibited under the Law?Other Prohibition:

It shall be unlawful for any business establishment which sells goods or services “to give the change in any form other than the present currency or to ask consumers for permission to be exempt-ed from the provisions of this Act for any reason, including nonavailability of small bills or coins.”


What are Required by the Law?Price Tags:

It is the duty of business establishments “to use price tags, when appropriate, indi-cating the exact retail price per unit or service which already includes the taxes ap-plicable to the goods or services being offered. These establishments shall also put signs in conspicuous places within the establishment or reflect in the official re-ceipts issued, the taxes incorporated in the retail price per unit of goods or services.”

The purpose is “to avoid misleading the consumers as to the exact price they have to pay for the goods or services and, consequently, the exact change due them.”


Prices should Now Be Inclusive of Tax

As provided in the law, the price tag “already includes the taxes ap-plicable to the goods or services being offered.”


Where and How to File a Complaint?Procedure for filing a complaint:

1) The consumer shall write and submit a letter of complaint to the Department of Trade and Industry (DTI) not later than 10 working days after a violation is committed.

2) The DTI shall, in not more than 10 working days after the complaint has been submit-ted, conduct an investigation, and shall issue a notice to the establishment involved.

3) After a full investigation, the DTI shall issue its decision and findings not later than 30 days from the receipt of the complaint.

The consumer is not precluded from filing any other claim under a different law.

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