Penalties should be imposed on online shopping apps selling bogus items - Sen. Gatchalian

On Thursday, Senator Sherwin Gatchalian said that online shopping apps should be held liable for the sale of counterfeit items on their platforms as this would boost efforts to put a stop on products that may be dangerous to Filipinos' health.

Gatchalian said in a report after a panel tackled his Senate Bill 1591, which seeks to protect consumers as more online enterprises open because of the COVID-19 pandemic. The government needs to create a mechanism that would push online shopping firms to ban unscrupulous traders from doing business.

Shopee and Lazada are the two largest online shopping apps in the Philippines. Gatchalian said,

Right now it is self-regulation. They are self-regulating themselves and it is not working because marami pa ring nakakalampas [many still get past penalties].There is no incentive for these platforms to weed out illegal items and unscrupulous sellers because they make money out of it also. Whatever we buy from online sellers, they get a cut, 

Under the Senate Bill no. 1591 filed by Gatchalian:

• Online merchants and shopping platforms that will sell fake or unregistered items will have to pay a fine equivalent to 100 percent of the amount of the digital goods offered.
• E-commerce platforms and online sellers who will fail to submit complete details of their shops and goods may also face a separate fine of between P500,000.00 and P5 million.
• Their business permit may also be revoked at the discretion of the court.

Gatchalian said that Philippines already has existing laws and mechanisms to deter the production and sale of fake items, however, the policies do not cover overseas sellers.

Our laws do not reach them because they are located in another country. The only way we can reach them is through these online selling platforms. The burden and the responsibility to double check and triple check on the sellers will be on the platforms,

Gatchalian added.

Lazada's chief executive officer Ray Alimurung said during the Senate Committee on Trade, Commerce and Entrepreneurship hearing, the company has been regulating its sellers and admits that illegal sellers of illegal goods get past the system because there are about 50 million items sold on the app.

Shopee said they have similar mechanisms on their app to arrest the sale of counterfeit items.

However, the Optical Media Board (OMB) said around 900,000 without necessary license or permits are still being sold in the Philippines' two biggest online shopping apps.

Gatchalian said that the e-commerce platforms are not doing enough. He expressed,

We don't want the Philippines to be the dumping ground of illegal products,