Pro-consumer measures

Days before 2017 became history, the government gave the public relief from certain business practices that have been the subject of numerous complaints.

Last Dec. 19, President Duterte signed into law Republic Act 10962 (or “Gift Check Act of 2017”) which makes it unlawful for companies to issue gift checks that bear expiry dates, or impose an expiry date on their stored values, or refuse to honor their unused value or credit.

Gift check or certificate (GC) is “any instrument issued to any person, natural or juridical, for monetary consideration, honored upon presentation at a single merchant or an affiliated group of merchants as payment for consumer goods or services.”

Shortly thereafter, the departments of Trade and Industry (DTI), Information and Communications Technology, and National Telecommunications Commission (NTC) issued a circular that extends the validity of prepaid mobile cards, commonly known as “load”, to one year.

The government initially pushed for “no expiry dates,” but settled for one year after the telecom companies explained the technical difficulties that an open-ended validity period would cause. The one-year expiry date is acceptable because of the reasonable certainty that the stored value of the card would be used by its holder within that period.

It will be recalled that, in 2012, when DTI, in response to numerous complaints from consumers, broached its plan to remove expiration dates on GCs issued by retail establishments, the latter raised vigorous objections.

They claimed the open-ended validity will overload their accounting facilities, delay the posting of sales transactions, and skew the preparation of their financial statements.

Their objections centered on the possible inconveniences to them of the scheme, but they conveniently omitted mentioning the fact they receive (and enjoy) the GCs’ monetary value upon their issuance. They insisted on expiration dates to oblige the consumers to redeem the value of the GCs even if there was no pressing need to do so, something akin to forced consumption.

Thankfully, DTI set aside these objections. The affected companies had no choice but make adjustments in their systems. And what do you know, none of them claimed later to have suffered serious losses on account of the lifting of the expiration dates.

The telecom companies also whined when, in 2009, NTC imposed minimum validity periods for load credits of prepaid mobile subscribers.

Before that, the telecom companies unilaterally (and arbitrarily) set their own rules on the validity period of prepaid cards and cunningly made scant effort to sufficiently inform their subscribers about its possible adverse effects. As a result, prepaid subscribers found themselves losing load credits without notice.

In protesting the NTC order, the telecom companies claimed that longer validity periods would increase their maintenance costs as they have to make additional provisions for space and bandwidth in their networks, and would delay their posting of revenues from prepaid cards.

No dice. NTC stood pat on minimum validity periods and the telecom companies grudgingly complied with them. Despite the technical and accounting problems that the NTC order allegedly would cost, the telecom companies raked in millions of pesos in profits in the succeeding years.

This time around, with the latest circular ordering a one-year validity period for prepaid load credits, the telecom companies are (surprisingly) not raising any objections and have expressed their willingness to comply with it.

Next on the agenda should be a law that would make this circular a legal requirement rather than an administrative instruction.

With these two measures, it is reasonable to say that 2018 started at the right footing for consumers and the public, in general.