The Department of Trade and Industry (“DTI”) issued on 7 February 2020 Department Administrative Order (“DAO”) No 02, Series of 2020, otherwise known as the “Revised Rules of Mediation and Adjudication of Consumer Complaints” (hereafter referred to as the “Revised Rules”),. With the issuance of the Revised Rules, the DTI expects a more efficient, expedient and convenient disposition of cases. The Revised Rules introduced the following amendments:
Title and Scope (Rule I)
The DTI now implements a “No-Wrong-Door” Policy, where any consumer complaints filed with the DTI, the subject matter of which does not fall under its jurisdiction, shall be accepted for appropriate assistance subject to the limitations provided by law. [Rule I, Section 3]
Initial Complaints (Rule II)
Under the Revised Rules, the DTI has made a distinction between complaints filed against “Bagwis Awardee” and “Non-Bagwis Awardee” business establishments. The DTI-Bagwis Awards give due recognition to establishments that uphold the rights of consumers while practicing responsible business where consumers get the best value for money. Complaints filed against “Bagwis Awardee” business establishments shall, within two (2) working days, be endorsed to the concerned business establishment, which in turn shall address the complaint within seven (7) calendar days from receipt of said endorsement. In the event that no report is made by the concerned business establishment within the 7-day period, the complaint shall be deemed to have been settled and shall be recorded as such. Otherwise, a Notice of Mediation shall be issued. [Rule II, Section 3]
On the other hand, The DTI shall immediately issue a Notice of Mediation upon receipt of a complaint against “Non-Bagwis Awardee” business establishments. [
Mediation (Rule III)
In addition to personal service and service by courier or registered mail, the Revised Rules now allow the service of Notice of Mediation to the concerned business establishment via e-mail at its online address as listed with the Securities and Exchange Commission (“SEC”) or DTI. In case of failure to serve due to business closure, incorrect address, or the address given cannot be located, the mediation proceedings shall be terminated and a Certificate to File Action (“CFA”) shall be issued by the Mediation Officer. [Rule III, Section 3]
The Mediation period is now within seven (7) working days from service of Notice of Mediation, extendible for a period of not more than ten (10) working days, upon agreement of both parties and as allowed by applicable laws and regulations. [Rule III, Section 4]
The execution of the Mediation Agreement shall be final and executory but the parties may, by mutual consent, seek the issuance of judgment on their agreement, in which case, they shall jointly file, within three (3) working days after execution of the Mediation Agreement, before the Adjudication Office a verified petition stating the fact of the agreement and the relief praying for approval thereof and issuance of a decision based thereon. It bears noting that a Submission of Mediation Agreement to the Adjudication Office is not required. [Rule III, Section 6.2]
When there is non-compliance of the mediation agreement [Rule III, Section 6.3 (a)], no settlement reached by the parties, or the party complained of refuses to appear at the scheduled mediation conference despite due notice, the Mediation Officer shall issue a CFA, with copies thereof served on the parties. [Rule III, Section 6.3 (b)]
The complainant’s or his/her representative’s failure to appear without good cause in two (2) consecutive scheduled mediation conferences despite due notice shall cause the withdrawal of the complaint without prejudice to the refiling of the same: Provided, that a similar failure or refusal to appear after such refiling shall cause the complaint to be withdrawn with prejudice. [Rule III, Section 6.4]
Mediation is terminated upon:
- Lapse of the 3-day period without the parties submitting the Mediation Agreement to the Adjudication Office. [Rule III, Section 6.5 (a)]
- Service on the complainant of the CFA. [Rule III, Section 6.5 (b)]
Adjudication (Rule IV)
Under the Revised Rules, a complaint lacking of one or some of the essential or formal requirements shall not be allowed to be filed with the Adjudication office or proper DTI Office. However, the Adjudication Officer or DTI Office concerned shall give the complainant the needed assistance if the insufficiency or defect in the complaint consists in those that can be administered within its capacity or capability, such as, but not limited to, administration of oaths in the verification, certificate of non-forum shopping or affidavits. [Rule IV, Section 1.4]
A formal complaint may now be filed with the DTI-Fair Trade Enforcement Bureau-Adjudication Division (“FTEB-AD”) in the National Capital Region (“NCR”). [Rule IV, Section 2] A change of venue to another DTI Office may be had, upon joint motion of the parties after filing of the complaint but before the submission of the parties’ position papers. [Rule IV, Section 2.1]
The Adjudication Officer shall issue a Notice of Adjudication (“NOA”) stating the name of the concerned DTI Office, the name of the parties, and directing both parties to submit their respective position papers. [Rule IV, Section 5] In addition to the usual modes of service, a service of NOA can be made by e-mail only with respect to the complainant.[ Rule IV, Section 6.1] Service of notice to the respondent shall be made either by personal service or by courier or registered mail only. [Rule IV, Section 6.1] The service of NOA and a copy of the formal complaint shall be equivalent to a service of summons. [Rule IV, Section 7]
The Adjudication Officer shall issue an Order directing the complainant to furnish, within five (5) working days from receipt of Order the true and correct address of the respondent when the NOA cannot be served upon the same. If the NOA remains unserved on the ground that respondent cannot be located, the Adjudication Officer shall issue an Order to archive the complaint subject to revival thereof within the remaining prescriptive period. [Rule IV, Section 8]
The Position Papers shall be filed with the concerned DTI Office within a non-extendible period of ten (10) working days from receipt of NOA. Any subsequent pleadings, if required by the Adjudication Officer for justifiable reason, shall be filed within three (3) working days from the date of the order requiring their filing. [Rule IV, Section 9(a)]
The case shall be submitted for decisions after the position papers of all parties have been filed, or after the lapse of the period for the filing of the parties’ position papers, whichever is earlier. [Rule IV, Section 10]
The Adjudication Officer may conduct a clarificatory hearing when it shall be determined that relevant matters set forth in the parties’ position papers, its supporting affidavits or documentary evidence need to be clarified and expounded for proper disposition of the case. The Adjudication Officer shall issue an Order setting the hearing within five (5) working days after the lapse of the period for filing of position papers. [Rule IV, Section 12]