DTI warns of penalties for practicing ‘no return, no exchange’ policy

THE Department of Trade and Industry (DTI) Cebu Provincial Office reminded commercial establishments to strictly avoid practicing the "No Return, No Exchange Policy" among defective products.

The agency warned of penalties for those who continue to practice such.

Dinah Gladys Oro, senior trade and industry development specialist, said on Friday, November 4, 2022, that the warning is particularly for establishments that continue to print "No Return, No Exchange Policy" within their receipts and those that verbally announce the practice to their customers.

“Although some stores have already exercised goodwill among their customers to maintain loyalty that they accept product exchanges, even those without defects, still there are some that observed the no return, no exchange policy. Though, I could not identify how many are still using the policy,” Oro told SunStar Cebu.

Oro said that Title III, Chapter 1, Rule 2, Section 7 of the Department Administrative Order 2 series of 1993 of Republic Act (RA) 7394, or Consumer Act of the Philippines, mandates business establishments not to include such a phrase or blot it out in their unused official receipts.

Oro said the "No Return, No Exchange Policy" statement is deceptive, leading to misconceptions by consumers that they do not have the right to return shoddy, defective, or imperfect service.

Only defective goods

Oro clarified that consumers are entitled to either an exchange or refund as long as there is a defect in the quality of goods or an imperfection in the service. But they are not excused for returning the goods because of a change of mind.

She said consumers could present their official receipts as proof of their defective purchase to the establishment where they bought it, and demand replacement or refund.

Oro said consumers must be given at least 30 days, not less than a year warranty, particularly for gadgets, considering that defects or malfunctions sometimes manifest within days after purchase.

Penalties

A fine of not less than P500, but not more than P20,000, or imprisonment of not less than three months but more than two years or both, at the discretion of the court, shall be given to individuals who disobey RA 7394.

Imposition of administrative fines in such an amount as deemed reasonable can be less than P500 or more than P300,000, depending on the gravity of the offense, and an additional fine of more than P1,000 or each day of continuing violations, said the DTI. (HIC)