House bill prohibits automatic add-ons in online transactions
Two lawmakers want to ban automatic or preselected add-ons in online transactions, which some businesses reportedly use to boost their sales of certain products or services.
In filing House Bill No. 11281, Nueva Ecija Rep. Rosanna Vergara and San Jose Del Monte Rep. Florida Robes cited instances of some customers, particularly senior citizens, who overlooked and failed to deselect add-on features in online transactions, which led to them paying for products or services they did not pick.
They recommended in their bill that the practice be included among the unfair and unconscionable sales acts listed in Republic Act No. 7394 or the Consumer Act of the Philippines.
In addition, they also pushed for higher penalties, raising the fines for violators from P20,000 to P100,000 from the current P500 to P10,000 under RA 7394.
“It may be observed that while mobile applications and websites have made transactions more convenient, some businesses use these platforms to subtly increase sales by automatically including add-ons during payment,” the lawmakers said.
They cited some airline companies that automatically include charges for seat selection or travel insurance in the airfare, requiring users to manually deselect the options. Certain mobile banking apps also preselect fund transfer insurance for amounts of P1,000 and above, they added.
Confusion
“These features are often difficult to notice or remove, creating confusion for users, particularly senior citizens, and those with limited online technology knowledge. As a result, customers may unintentionally pay for services they do not need, imposing unnecessary financial burdens,” they said.
HB 11281, according to them, intends to “help people avoid unintended expenses which they are not fully knowledgeable about, thereby upholding the Filipino consumer’s right to make informed choices.”
Other unfair and unconscionable sales acts included in Article 59 of RA 7394 are when a seller takes advantage of a consumer’s inability to understand the language of an agreement; when the price grossly exceeds that of a similar product or service when sold to the consumer; when the consumer is unable to receive a substantial benefit from the subject of the transaction; when the seller or supplier is aware there is no reasonable probability or payment of the obligation in full by the consumer; and when the seller or supplier induces the consumer to enter into an excessively one-sided transaction which favors the former.
