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Act No. 7581.May
27, 1992THE PRICE ACT
REPUBLIC
ACT NO. 7581May 27,
1992AN ACT
PROVIDING PROTECTION
TO CONSUMERS BY STABILIZING THE PRICES OF BASIC NECESSITIES AND PRIME
COMMODITIES
AND BY PRESCRIBING MEASURES AGAINST UNDUE PRICE INCREASES DURING
EMERGENCY
SITUATIONS AND LIKE OCCASIONS.
Sec. 1. Short Title.
- This Act shall be referred to as the "Price Act."
Sec. 2. Declaration of
Basic Policy. - It is the policy of the State to ensure the
availability
of basic necessities and prime commodities at reasonable prices at all
times without denying legitimate business a fair return on investment.
It is also a declared policy of the State to provide effective and
sufficient
protection to consumers against hoarding, profiteering and cartels with
respect to the supply, distribution, marketing and pricing of said
goods,
especially during periods of calamity, emergency, widespread illegal
price
manipulation and other similar situations. To these ends, the State
shall:
(1) Develop,
adopt and
promulgate
measures to promote productivity in basic necessities and prime
commodities;
(2) Develop
an
improved and
efficient transport and distribution system;
(3)
Develop, adopt
and promulgate
measures to stabilize prices at reasonable levels;
(4)
Institute
appropriate
penalties for illegal price manipulation and other violations of this
Act;
and
(5)
Establish a
mechanism
that will readily protect consumers from inadequate supply and
unreasonable
price increase on occasions of calamities, emergencies and like
occurrences.
Sec. 3. Definition of Terms.
- For purposes of this Act, the term:cralaw:red
(1) "Basic
necessities"
includes: rice; corn; bread; fresh, dried and canned fish and other
marine
products, fresh pork, beef and poultry meal; fresh eggs; fresh and
processed
milk; fresh vegetables; root crops; coffee; sugar; cooking oil; salt;
laundry
soap; detergents; firewood; charcoal; candles; and drugs classified as
essential by the Department of Health;
(2) "Butter
fund"
means a contingent fund in the budget of the implementing agency which
shall not be used in its normal or regular operations but only for
purposes
provided for in this Act;
(3) "Implementing
agency" means the department, agency or office of the Government
which
has
jurisdiction over a basic necessity or prime commodity as defined in
this
Act, which shall be:
(a) The
Department of
Agriculture,
with reference to agricultural crops, fish and other marine products,
fresh
meat, fresh poultry and dairy products, fertilizers, and other farm
inputs;
(b) The
Department
of Health,
with reference to drugs;
(c) The
Department
of Environment
and Natural Resources, with reference to wood and other forest
products;
and
(d) The
Department
of Trade
and Industry, with reference to all other basic necessities and prime
commodities.
(4) "Panic-buying"
is the abnormal phenomenon where consumers buy basic necessities and
prime
commodities grossly in excess of their normal requirement resulting in
undue shortages of such goods to the prejudice of less privileged
consumers;
(5) "Person"
means
a natural person or juridical person;
(6) "Prevailing
price"
means the average price at which any basic necessity has been sold in a
given time within a month from the occurrence of any of the conditions
enumerated under Section 6 of this Act;
(7) "Price
ceiling"
means the maximum price at which any basic necessity or prime commodity
may be sold to the general public; and
(8) "Prime
commodities"
include fresh fruits; flour; dried processed and canned pork; beef and
poultry meat; dairy products not falling under basic necessities;
noodles;
onions; garlic; vinegar; patis; soy sauce; toilet soap; fertilizer;
pesticides;
herbicides; poultry; swine and cattle feeds; veterinary products for
poultry,
swine and cattle; paper; school supplies; nipa shingles; sawali;
cement;
clinker; GI sheets; hollow blocks; plywood; plyboard; construction
nails;
batteries; electrical supplies; light bulbs; steel wire; and all drugs
not classified as essential drugs by the Department of Health.
Sec. 4. Exclusion from the
Coverage of this Act. - Upon petition of the concerned parties and
after public hearing, the implementing agency, with the approval of the
President, may exclude from the coverage of this Act, types or brands
of
the goods included in the definition of basic necessities and prime
commodities,
which may be deemed as nonessential goods or luxury goods: Provided,
That, any type or brand so excluded may be reinstated by the
implementing
agency during occasions of acute shortage in the supply of the basic
necessity
or prime commodity to which the excluded type or brand used to belong.
Sec. 5. Illegal Acts of
Price Manipulation. - Without prejudice to the provisions of
existing
laws on goods not covered by this Act, it shall be unlawful for any
person
habitually engaged in the production, manufacture, importation,
storage,
transport, distribution, sale or other methods of disposition of goods
to engage in the following acts of price manipulation of the price of
any
basic necessity or prime commodity:
(1)
Hoarding, which is
the
undue accumulation by a person or combination of persons of any basic
commodity
beyond his or their normal inventory levels or the unreasonable
limitation
or refusal to dispose of, sell or distribute the stocks of any basic
necessity
of prime commodity to the general public or the unjustified taking out
of any basic necessity or prime commodity from the channels of
reproduction,
trade, commerce and industry. There shall be prima facie evidence of
hoarding
when a person has stocks of any basic necessity or prime commodity
fifty
percent (50%) higher than his usual inventory and unreasonably limits,
refuses or fails to sell the same to the general public at the time of
discovery of the excess. The determination of a person's usual
inventory
shall be reckoned from the third month immediately preceding before the
discovery of the stocks in case the person has been engaged in the
business
for at least three (3) months; otherwise, it shall be reckoned from the
time he started his business.
(2)
Profiteering,
which is
the sale or offering for sale of any basic necessity or prime commodity
at a price grossly in excess of its true worth. There shall be prima
facie
evidence of profiteering whenever a basic necessity or prime commodity
being sold: (a) has no price tag; (b) is misrepresented as to its
weight
or measurement; (c) is adulterated or dilluted; or (d) whenever a
person
raises the price of any basic necessity or prime commodity he sells or
offers for sale to the general public by more than ten percent (10%) of
its price in the immediately preceding month: Provided, That, in the
case
of agricultural crops, fresh fish, fresh marine products, and other
seasonal
products covered by this Act and as determined by the implementing
agency,
the prima facie provisions shall not apply; and
(3) Cartel,
which is
any
combination of or agreement between two (2) or more persons engaged in
the production, manufacture, processing, storage, supply, distribution,
marketing, sale or disposition of any basic necessity or prime
commodity
designed to artificially and unreasonably increase or manipulate its
price.
There shall be prima facie evidence of engaging in a cartel whenever
two
(2) or more persons or business enterprises competing for the same
market
and dealing in the same basic necessity or prime commodity, perform
uniform
or complementary acts among themselves which tend to bring about
artificial
and unreasonable increase in the price of any basic necessity or prime
commodity or when they simultaneously and unreasonably increase prices
on their competing products thereby lessening competition among
themselves.
Sec. 6. Automatic Price
Control.
- Unless otherwise declared by the President, prices of basic
necessities
in an area shall automatically be frozen at their prevailing prices or
placed under automatic price control whenever:cralaw:red
(1) That
area is
proclaimed
or declared a disaster area or under a state of calamity;
(2) That
area is
declared
under an emergency;
(3) The
privilege of
the
writ of habeas corpus is suspended in that area;
(4) That
area is
placed under
martial law;
(5) That
area is
declared
to be in a state of rebellion; or
(6) A state
of war is
declared
in that area.
If the prevailing price of any
basic necessity is excessive or unreasonable, the implementing agency
may
recommend to the President the imposition of a price ceiling for the
sale
of the basic necessity at a price other than its prevailing price.
Unless sooner lifted by the
President, price control of basic necessities under this section shall
remain effective for the duration of the condition that brought it
about,
but not for more than sixty (60) days.
The terms "disaster"
and "calamity" shall include those brought about by natural or man-made
causes, whether local or foreign.
Sec. 7. Mandated Price
Ceiling. - The President, upon the recommendation of the
implementing
agency, or the Price Coordinating Council, may impose a price ceiling
on
any basic necessity or prime commodity if any of the following
conditions
so warrants:
(1) The
impendency,
existence,
or effects of a calamity;
(2) The
threat,
existence,
or effect of an emergency;
(3) The
prevalence or
widespread
acts of illegal price manipulation:
(4) The
impendency,
existence,
or effect of any event that causes artificial and unreasonable increase
in the price of the basic necessity or prime-commodity; and
(5)
Whenever the
prevailing
price of any basic necessity or prime commodity has risen to
unreasonable
levels.
Sec. 8. Determination of
Price Ceilings. - In determining the reasonable price ceiling, the
following factors may be taken into consideration:cralaw:red
(1) The
average price,
in
the last three (3) months immediately preceding the proclamation of the
price ceiling, of the basic necessity or prime commodity under
consideration;
(2) The
supply
available
in the market;
(3) The
cost to the
producer,
manufacturer, distributor or seller including but not limited to:
(a) The
exchange rate
of
the peso to the foreign currency with which a basic necessity or prime
commodity or any component, ingredient or raw material thereof was paid
for;
(b) Any
change in
the amortization
cost of machinery brought about by any change in the exchange rate of
the
peso to the foreign currency with which the machinery was bought
through
credit facilities;
(c) Any
change in
the cost
of labor brought about by a change in the minimum wage; and
(d) Any
increase in
the cost
of transporting or distributing the basic necessity or prime commodity
to the area of destination.
(4) Such
other
factors or
conditions which will aid in arriving at a just and reasonable price
ceiling.
Sec. 9. Allocation of a
Buffer
Fund to the Implementing Agency. - The implementing agency may
procure,
purchase, import, or stockpile any basic necessity or prime commodity,
devise ways and means of distributing them for sale at reasonable
prices
in areas where there is shortage of supply or a need to effect changes
in its prevailing price. For any or all of these purposes, a buffer
fund
shall be allocated in the annual appropriations of the implementing
agencies.
Sec. 10. Powers and
Responsibilities
of Implementing Agencies. - To carry out the intents and purposes
of
this Act, the head of the implementing agency shall have the following
additional powers and responsibilities:
(1) He
shall, with the
approval
of the President, promulgate rules, regulations, and procedure for the
implementation of this Act;
(2) He
shall develop,
promulgate
and implemental programs, projects or measures to promote productivity
in all basic necessities and prime commodities under his agency's
jurisdiction;
(3) He
shall promote
and
facilitate the establishment of an effective procurement, storage,
marketing
and distribution system of basic necessities and prime commodities to
ensure
their availability in all areas of the country where they are needed;
(4) During
instances
of panic-buying,
he may, with the approval of the President, institute temporary
measures
to ensure orderly and equitable distribution to consumers of basic
necessities
and prime commodities in the affected area;
(5) Form
time to
time, he
may issue suggested reasonable retail prices for any or all basic
necessities
and prime commodities under his jurisdiction for the information and
guidance
of producers, manufacturers, traders, dealers, sellers, retailers, and
consumers;
(6) He
shall cause
the immediate
dissemination of any mandated price ceiling for any basic necessity or
prime commodity under his agency's jurisdiction through publication in
a newspaper of general circulation in the area affected, and through
broadcast
by radio, or whenever deemed to materially make dissemination of the
information
more effective, by television. He may also cause the information to be
disseminated through posting in public markets, supermarkets or other
public
places;
(7) He may,
upon
approval
of the President, and subject to existing laws, rules and regulations
on
bidding, enter into any agreement with any local or foreign producer,
manufacturer,
supplier, distributor, or seller for the procurement of supplies of
stocks
of any basic necessity or prime commodity for purposes of buffer
stocking:
Provided, That, in areas where there are shortages or rampant illegal
manipulation
of prices, he may order their immediate sale;
(8) He may,
subject
to existing
laws, rules and regulations on bidding, enter into any agreement with
owners
or operators of warehouses or storage houses or with owners, operators
of franchise holders of vehicles or public utilities for the storage,
transport,
or distribution of any basic necessity or prime commodity;
(9) He may
conduct
investigations
of any violation of this Act and, after due notice and hearing, impose
administrative fines in such amount as he may deem reasonable which
shall
in no case be less than One thousand pesos (P1,0000) nor more than One
million pesos (P1,000,000). In the imposition of administrative fines
the
following factors shall be taken into consideration:
(a)
Whether the
subject
of the violation is a basic necessity or a prime commodity; violations
involving basic necessities shall be deemed more serious;
(b)
Whether the
subject of
the violation is under price control under Sections 6 and 7 of this
Act;
violations involving basic necessities and prime commodities under
price
control shall be deemed more serious;
(c) The
number of
violations
committed; respondents who had previously been found to have violated
any
of the provisions of this Act shall be imposed a higher fine; and
(d) Such
other
considerations
as may be deemed necessary to carry out the intents purposes and
provisions
of this Act.
(10) He may
require
the attendance
and testimony of witnesses or the production of goods, objects, books,
papers, documents, contracts, records, financial statements, accounts,
agreements and such other evidences material in the determination of
any
violation of this Act;
(11)
Without
prejudice to
the power to issue temporary closure or temporary restraining order for
a period which shall not be more than ten (10) days, he may, after due
notice and hearing issue cease and desist orders; reprimand; censure;
suspend,
revoke or cancel any permit, license, authority or registration issued
by his office; or order the permanent closure of any establishment
violating
the provisions of this Act;
(12) He may
initiate
summary
proceedings to cause the seizure by the Government of basic necessities
and prime commodities subject of a violation of this Act and order
their
sale to the public at reasonable prices whenever the nature of or the
demand
for such goods so requires: Provided, That, pending litigation, the
proceeds
of the sale shall be held in trust or escrow by the implementing
agency:
Provided, further, That, should the owner of the basic necessity or
prime
commodity seized and sold be found not liable for the violation which
was
the basis of the seizure, the proceeds from their sale shall be paid to
him, otherwise, they shall accrue to the general fund of the Government
and: Provided, finally, That, the head of the implementing agency shall
cause the broadcast in radio or television and the publication in at
least
two (2) newspapers of general circulation of the fact of sale or
disposition
of such seized goods at least three (3) days before the date of sale or
disposition;
(13) He may
initiate
action
and cause the prosecution before the proper court of law of violations
of this Act;
(14) He may
deputize
and
enlist the assistance of any government official or agency in carrying
out the provisions of this Act; and
(15) Such
other
functions
and ancillary powers as may be necessary to effectively implement this
Act.
Sec. 11. Price Coordinating
Council. - There is hereby created a Price Coordinating Council,
hereinafter
referred to as the Council, to be composed of the following members:cralaw:red
(1) The
Secretary of
Trade
and Industry, as Chairman;
(2) The
Secretary of
Agriculture;
(3) The
Secretary of
Health;
(4) The
Secretary of
Environment
and Natural Resources;
(5) The
Secretary of
Local
Government;
(6) The
Secretary of
Transportation
and Communications;
(7) The
Secretary of
Justice;
(8) The
Director
General
of the National Economic and Development Authority;
(9) One (1)
representative
from the consumers' sector;
(10) One
(1)
representative
from the agricultural producers' sector;
(11) One
(1)
representative
from the trading sector; and
(12) One
(1)
representative
from the manufacturers' sector.
The sectoral representatives
of the Price Coordinating Council shall be appointed by the President
for
a term of one (1) year, without prejudice to reappointment for another
term.
The Council shall meet every
quarter and whenever the President or the Chairman shall convene the
same.
Each member shall receive reasonable reimbursements for transportation.
Members from the government
sector may designate their representative to the Council;
The Department of Trade and
Industry shall provide the secretariat to the Council from its existing
organizational structure.
Sec. 12. Functions of
the Price Coordinating Council. - The Price Coordinating Council
shall
have the following functions:
(1) It shall
coordinate
the productivity, distribution and price stabilization programs,
project
and measures of the Government and develop comprehensive strategies to
effect a general stabilization of prices of basic necessities and prime
commodities at affordable levels;
(2) It
shall report
to the
President and to the Congress of the Philippines the status and
progress
of the programs, projects, and measures undertaken by each implementing
department, agency or office as well as the comprehensive strategies
developed
by the Council to stabilize the prices of basic necessities and prime
commodities;
(3) It
shall advise
the President
on general policy matters for promotion and improvement in
productivity,
distribution and stabilization of prices of basic necessities and prime
commodities;
(4) It may
require
from its
members or any other government agency such information as it may deem
necessary, and conduct public hearings for purposes of assessing the
supply,
distribution and price situation of any basic necessity or prime
commodity;
(5) It
shall
publicize from
time to time developments in productivity, supply, distribution and
prices
of basic necessities and prime commodities; and
(6)
Whenever
automatic price
control of basic necessities is imposed under Section 6 of this Act, it
shall cause the immediate dissemination of their prevailing prices or
the
price ceilings imposed in lieu thereof, as the case may be, through
publication
in a newspaper of general circulation in the area affected, and through
broadcast by radio and, whenever the same is deemed to materially make
dissemination of the information more effective, by television. It may
also disseminate the information through posting in public markets,
supermarkets
and other public places.
Sec. 13. The Price Action
Officer Powers and Functions. - Whenever the President deems it
necessary,
he may appoint any of the members of the Price Coordinating Council as
Price Action Officer for the duration of the automatic price control
under
Section 6 of this Act who shall have the following powers and functions:cralaw:red
(1) He shall
carry out,
implement and enforce the policies and decisions of the Council;
(2) He
shall
coordinate the
actions of all implementing agencies involved in the monitoring and
investigation
of abnormal price movements and shortages of basic necessities and
prime
commodities;
(3) He may
call upon
any
official, agent, employee, agency or instrumentality of the national or
local government for any other assistance that he may deem necessary to
carry out the purposes of this Act;
(4) He
shall
establish linkage
and coordinate with nongovernment or private organizations in the
affected
are to assist in the monitoring and implementation of price control
therein;
and
(5) He
shall exercise
such
other functions and duties as may be given to him by the President.
Sec. 14. Role of the
National
Statistics Office. - The National Statistics Office shall conduct
independent
periodic surveys and studies of the selling prices of all basic
necessities
and prime commodities all over the country as well as their share or
effect
on the family income of the different economic groups in the country
for
purposes of serving as data base for government efforts to stabilize
prices,
as well as evaluating the effectivity of the same.
Sec. 15. Penalty for Acts
of Illegal Price Manipulation. - Any person who commits any act of
illegal price manipulation of any basic necessity or prime commodity
under
Section 5 hereof shall suffer the penalty of imprisonment for a period
of not less than five (5) years nor more than Fifteen (15) years, and
shall
be imposed a fine of not less than Five thousand pesos (P5,000) nor
more
than Two million pesos (P2,000,000)
Sec. 16. Penalty for
Violation
of Price Ceiling. - Any person who violates Section 6 or 7 of this
Act shall suffer the penalty of imprisonment for a period of not less
than
one (1) year nor more than ten (10) years of a fine of note less than
Five
thousand pesos (P5,000) nor more than One million pesos (P1,000,000),
or
both, at the discretion of the court.
Sec. 17. Violation by
Juridical Persons. - Whenever any violation of the provisions of
this
Act is committed by a juridical persons, its officials or employees, or
in case of a foreign corporation or association, its agent or
representative
in the Philippines who are responsible for the violation shall be held
liable therefor.
Sec. 18. Violation by
Aliens. - In case of aliens, in addition to the penalty provided in
Section 15 or 16 of this Act, the offender shall, upon conviction and
after
service of sentence, be immediately deported without need of any
further
proceedings.
Sec. 19. Violation by
Government Officials or Employees. - Any public official or
employee
who, by reason of his office, with or without consideration, conspires
in the commission or knowingly conceals violations of any of the
provisions
of this Act shall likewise be principally responsible for the violation
and shall suffer the additional penalty of permanent disqualification
to
hold public office.
Sec. 20. Criminal Penalties
Without Prejudice to Administrative Sanctions. - The foregoing
criminal
penalties shall be without prejudice to the administrative sanctions
which
the implementing agency may impose under this Act or under any other
law.
Sec. 21. Relations of
the Price Act to Other Laws, Presidential
Issuances.
- Nothing in this Act shall be constructed as removing or diminishing
the
jurisdiction of any agency of Government on certain goods o products
conferred
by other laws or presidential issuances.
Sec. 22. Separability
Clause. - If, for any reason, any provision of this Act or the
application
of such provision to any person group or circumstance is declared
invalid
or unconstitutional, the remainder of this Act shall not be affected by
such declaration.
Sec. 23. Repealing Clause.
- To the extent inconsistent with this Act, the following laws and
letters of instruction are hereby repealed:
(1) Republic
Act No.
4164,
entitled "An Act to Prevent the Excessive Increase in the Price of
Certain
Prime Necessities of life on the Occasion of a Public Calamity,
Penalizing
the Violation Thereof, and for other Purposes."
(2)
Presidential
Decree No.
1674, entitled "Providing a Mechanism for Price Regulation, Creating a
Price Stabilization Council, Prescribing its Powers and
Responsibilities
and for other Purposes;
(3) Letter
of
Instruction
No. 1305, entitled "Directing Measures to Prevent Cement Hoarding,
Price
Manipulation and Profiteering."
(4) Letter
on
Instruction
No. 1342, entitled "Ordering Immediate Measures to Prevent Price
Manipulation
and to Protect Consumers; and
(5) Letter
of
Instruction
No. 1359, entitled "Directing Measures to Prevent Hoarding,
Profiteering
and Price Manipulation.
All laws, and rules and
regulations
inconsistent herewith are hereby likewise repealed or modified
accordingly.
Sec. 24. Effectivity Clause.
- This Act shall take effect three (3) days after its publication in
two
(2) national newspapers of general circulation.
Approved:
May 27, 1992
.
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