From getting defective or counterfeit goods from unscrupulous online sellers, to failing to receive products already paid for from fake retail sites, far too many unsuspecting buyers have seen them all.

And yet, they’ve had little recourse except to charge these painful incidents to experience.

Fortunately, those days may soon be over, after President Marcos signed last week Republic Act No. 11967 or the Internet Transactions Act (ITA), one of 20 priority bills of his administration.

Authored and sponsored by Sen. Mark Villar, the new law is considered a game-changer as it establishes a regulatory framework to cover online transactions that would protect both consumers and merchants against scams and fraudulent transacting online.

Code of conduct

Among the safety mechanisms provided by the law is holding liable the e-marketplace, digital platform, and online merchant or retailer if they fail to fulfil their responsibilities to the consumer, such as selling defective products.

In the same vein, the ITA protects merchants through the establishment of a code of conduct for business entities that would flag and sanction anti-competitive practices, such as putting up sites that pass themselves off as authorised online shops.

Under the law, the Department of Trade and Industry (DTI) is given regulatory jurisdiction over internet transactions, vesting it with the power and authority to, among others, take down questionable websites if the goods, services, or digital products advertised are found to be “imminently injurious, unsafe, or dangerous to the public”.

E-commerce bureau

Putting the e-commerce bureau under the DTI will ensure fair business practices and establish effective mechanisms for dispute resolution.

Both merchants and buyers can now identify a government office where they can air and settle legitimate complaints and issues.

DTI records show that consumer complaints have been on the rise with the exponential growth of e-commerce.

Last year, the agency received 27,947 complaints, more than double the 10,000 it had received in 2019. Of these, 44 percent pertained to online transactions, such as defective products, unregistered sales promotions, the use of fake identities to appear as legitimate merchants, and malicious online shopping sites.

To further protect consumers, the e-commerce bureau has been tasked to create an online database that will provide the government and consumers access to information on businesses with digital operations to allow the public to check out legitimate sites where they can transact safely.

Landmark measure

With these provisions providing merchants and consumers a safety net, Trade Secretary Alfredo Pascual described the ITA as a “landmark measure” whose time has come, given that “online selling and online buying is now our way of life”.

The bottomline with the ITA is that with both online merchants and consumers amply protected, the system generates a greater trust that is expected to unleash the full potential of e-commerce.

As losses from scams and frauds are minimised, Filipinos are now armed with increased confidence with which to take advantage of the flourishing digital economy.

According to data and analytics firm GlobalData, e-commerce sales in the Philippines are expected to continue to grow by a high 17.9 percent every year and hit P969 billion (RM81 billion) by 2026, as more Filipinos patronise the online marketplace.

This year alone, the e-commerce market is expected to surge by 22.9 percent to P615.7 billion (RM52 billion).

Last year’s estimated 31.3 percent rise to P500.9 billion (RM42 billion) has been attributed to an increasing number of consumers moving from offline to online purchases that are supported by high internet and smartphone penetration.

This, in turn, indicates that the young have been flocking to online sites.

Smart consumer

It must be emphasised, however, that despite its well-thought out provisions, the ITA will not magically rid the market of frauds and scams.

History has shown that unscrupulous individuals and entities will always find ways to line their pockets with gains from unsuspecting and vulnerable consumers.

Thus, it would be wise, particularly this holiday season when shopping hits its peak, for Filipinos to exercise caution and vigilance, and to complement the law’s provisions with a careful research of online sites.

This would allow them to fully enjoy the convenience, variety, and good deals offered by e-commerce which are bound to get bigger in the years ahead.

As the DTI suggests, select merchants carefully. Check the reviews posted by previous buyers, and study their exchange and return policy.

Confirm and verify the online seller’s physical address and phone number before “adding to cart”.

There will always be scams and frauds as long as there are foolhardy buyers out there. Ultimately, the first line of defence against these online fraudsters are smart consumers who are aware of the law, and know their rights under it.