REPUBLIC ACT NO. 7581 - AN 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
Section 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:
(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 Sec. 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 diluted; 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 faciae 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:
(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:
(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.
SECTION 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 implement all
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 (P1,000) 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 Section s 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 and 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.
SECTION 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:
(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.
SECTION 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 Sec. 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.
SECTION 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 Sec. 6
of this Act who shall have the following powers and functions:
(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.
SECTION 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.
SECTION 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 Sec. 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)
SECTION 16. Penalty for Violation of Price Ceiling. —
Any person who violates Sec. 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.
SECTION 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
therefore.
SECTION 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.
SECTION 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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