dti DEPARTMENT ADMINISTRATIVE ORDER NO. _! Series of 2014 IMPLEMENTING RULES AND REGULATIONS OF REPUBLIC ACTNO. 10642, 'AN ACT STRENGTHENING CONSUMER PROTECTION IN THE PURCHASE OF BRAND NEW MOTOR VEHICLES Pursuant to Section 13 of Republic Act No. 10642, the folowing rules and regulations are hereby promulgated: Title Rulet ‘General Provisions Section 4. Construction and Interpretation. These Rules shall be interpreted. construed and implemented pursuant to the intents and purpeses of the (Declaration of Policy in Section 2 of Republic Act No 10842 Section 2. Relation to Other Laws. These rules shall apply primariy in the ‘etermination ‘and resolution of Coneumer compainis as it relates to Motor Vehicles covered under The Philppine Lemon Law. The provisions of Republic ‘Act No, 7394 of “The Consumer Act of the Philippines’, and its Implementing Rules and Regulations, and other related laws, shall apply where applicable. uot Definition of Terms Section 1, Definition of Terms. For purposes ofthis IRR, the folowing terms of [Phrases used in Section 3, Definition of Terms of the Phiippine Lemon Law are Understood as folows: 44, Standards and specifications of the motor vohicle refers to the standards, description, pats, accessories and other specifications such as but not limited t those contained in the Manufacturer's or Distributors ‘Manuel, Owner's Manual and the motor vehicle's specification. rage 1018 (ey are sina ul eS Papi, 20 Mat Cy Pepe ‘Dapiona 6} 800083 Far (52) 006108 Ema secatnyeen gui12. 13. 14, 15. 16. Noncompliance by the consumer of the obligations undor the warranty means failure of the consumer to observe the terms and Conditions stated in the writen warranty of the motor vehicle offered by manufactureridistrbutor, ‘Any modification of existing warranty of motor vehicle by the manufacturer oF distributor may be subject to review of the Department of Trade and Industry (DTI) to ensure that there shall be no diminution of warranty rights of the consumer. Unauthorized modification means alteration made by the consumer on the motor vehicle and not authorized under the terms and condrions of the sale andlor from the factory standards of the manufacturer and distributor. ‘These shall include alterations on motor engine and vehicle engineering ‘and body design, mechanical or electrical system, vehicle conversions, tampering of fuel management system, emission control and odometer system, ‘Modification that will not affect the safety, use and value of the motor Vehicle are excluded from this definition ‘Abuse or neglect of the brand now motor vehicle 1.41 Abuse means the use of a motor vehicle in a manner not in ‘accordance with the provisions stated in the Owner's Manual, the Manufacturer's ServicenVarranty Booklet. 1.4.2 Neglect means failure of the Consumer to properly and regularly maintain the Motor Vehicle pursuant to the Owner's ManualService or ‘Warranty Booklet provided to the Consumer. Damage to the vehicle due to accident or force majeure 1.8.4 Accident means any man-made event that causes damage or injury over which the manufacturer, distibutor, authorized dealer or retaller has 1 contro 1.8.2 Force Majeure means any event caused by elements or forces of nature such as, but not limited to, typhoon, flood, earthquake and volcanic eruptions. Repair is a service activity performed on the Motor Vehicle by replacing a ‘component or parts, or by performing adjustments to ensure conformity to the manufacturer's standards and specifications. Page 20f81.7. Repair Attompt is a process that begins when the Consumer brings the ‘Motor Vehicle to the manufacturer, distributor, authorized deale: or retailer for repair of a specific complaintis and which shall be completed within fifteen (18) days from delivery of the motor vehicle to the dealer. If repai ‘was completed in excess of fiteen (15) days, the excess period shall be ‘added to the Lemon Law Rights Period of the motor vehicle. 1.8. Same complaint refers to the same non-conformity occurring in the Motor Vehicle, arising from the same cause and conditions, as was the previous ‘non-conformity subject ofa prior repair. Rule it ‘Scope and Coverage Section 1. Covera hereby adopted. The provision in Section 4 of the law on Coverage is Title Procedures in Availing Lomon Law Rights Rule! Repair Attempt ‘Section 1. Repair Attompts. The provision in Section 6 of the law on Repair Attempts is hereby adopted, Section 2. Repair Attompt Process. A completed repairjob order constitutes ‘one repair attempt by undergoing the process outlined below. 24, The Consumer andlor representative, specifically authorized In writing by the Consumer, bring the motor vehicle to the same authorized Dealer report and/or demonstrate the complaint on tne Motor Venici. 2.2, The Dealer, at all times, shall receive the motor vehicle, and records the ‘consumer's complaint on the Motor Vehicle 2.3. The Dealer shall advise the Consumer of the proposed repal's) and the estimated time to complete the repairs). 2.4, The Consumer authorizes the repair by affixing his/her signature on the repaitfob order. 2.8, The Dealer, upon completion of the repair activity, releases the motor vehicle to the consumer and shall provide the Consumer with an inventory ‘of repairs done as completed and parts replaced. 2.6, The Dealer returns the parts replaced and furnishes the results of any test activity which was performed, if any. Page 3.082.7. Consumer receives the unit and i the motor vehicle is not retuned within fifteen (15) days from release, the repair is deemed accepted. 2.8. Any Repair covered by the Manufacturer's Warranty shall not be charged for tabor and parts. ‘Section 3. Repair Attempt Not Completed. A repair attempt that is started but ‘not completed by the dealer for reason attributable to the dealer shall be treated 1s one repair attempt. Rule t Notice of Availment of Lemon Law Rights Section 1. Notice to Manufacturer, distributor, authorized dealer or retailer. Incase the nonconformity issue remains unresolved after four (4) separate Repair ‘Attempts, the Consumer shall, in writing, notify the manufacturer, distributor, authorized dealer or retaller ofthe unresolved complaint and the Consumer shall invoke the Lemon Law rights and serving notices to all Parties through, cour personal delivery or postal services with proof of service and receipt. Section 2. Responsibilities of the Consumer. The warranty booklet shall clearly slate the responsibilties of the consumer as follows: 24, The Consumer shall keep copy of repair records; 2.2. The Consumer shall ensure that the odometer reading or the date of vehicle delivery for Final Attempt at the servicing dealer is within the Lemon Law rights period; 2.3. The Consumer shall, in writing and in the form preserived in the Warranty Booklet (the Notice of Availment form), notily the manufacturer, distributor, authorized dealer or retaller of the unresolved complaint after four (4) separate repair attempts; and 24, The Consumer shall ikewise retain the documentary requirements specified in Section 2, Rule Ill of these rues. Section 3. Final Repair Attempt. The consumer shall bring the vehicle to the manufacturer, distributor, authorized dealer or retaller from where the vehicle was purchased for a final attempt fo address the complaint of the consumer to his or her satisfaction. Page sofbe Rule it ‘Availment of Lemon Law Rights Section 1. Availment of Lemon Law Rights. The process of availment stated in Section 7 of the law is hereby adopted. The complaint shall be fled by the ‘consumer withthe DTI office within the period provided by Lemon Law. Otherwise the right to file the same shall be deemed prescribed, in accordance with Section 3¢h) thereot. Section 2. Rights and Remedies Under Any Other Law. Nothing rerein shal be construed to limit or impair the rights and remedies of a consumer under any other law, Section 3. Documentary Requirements. in order for the consumer to invoke the Lemon law Rights, the following documents are necessary: Warranty Booklet/Service Booklet; ‘2.2, Current Motor Vehicle Registration; 2.3. Allrepairjob order invoices. and 4.4. Notice of Avaiiment stamped received by the Dealer or accompanied by proof of receipt by the Dealer ofthe Notice of Avalment, Title m Remedies for Disputo Resolution Section 4. Alternative Dispute Resolution. The DTI shall exercise eyclusive and original jurisdiction over disputes arising from the provisions of this Act. All disputes arising from the provisions of this Act shall be settled by the DT in accordance with the Section 8 of the Lemon Law in relation to the existing DTT rules on dispute resolution, Rule Dispute Resolution Mechanisms. ‘Section 1. Mediation. A complaint fled on a cause of action avallng of rights ‘anchored on the Lemon Law shall undérgo mediation proceedings, a6 provided under existing DTI administrative rules and regulations, Section 2. Arbitration. if mediation fails, both parties may voluntarly decide to Undertake arbitration proceedings and shall notify the DT! in wring of their intention to undertake arbitration proceedings. The arbitration proceedings shall bbe governed by the provisions of Republic Act No. 9285, otherwise known as the “altemative Dispute Resolution Act of 2004” and its Implementing Rules and Regulations. Page Sof‘Section 3. Adjudication. If both parties decide not to undertake the arbitration proceedings, either of them may commence adjudication proceedings by fling Verified complaint or a notice that a verified complaint has been fled earlier with the DTI and upon depositing the amount of Ten Thousand (Php 10,00¢.00) Pesos jn an escrow account/deposit ina bank of hisfher choice. The edjudication ‘proceedings shall be administered by the DTI not later than twenty (20) working ‘days subject tothe existing DTI administrative rules and regulations, In case a nonconformity issue of the motor vehicie is not found by the DTI, the ‘escrow deposit shall reimburse the cost incurred in validating the consumer's ‘Complaint and can only be released with an order from the Adjudication Officer of DTI, otherwise the escrow amount shal be returned to the consumer. Section 4. Submission of Warranty or Service Booklot. Manufacturers and Distributors are required to submit to the DTI a copy of the warranty or service booklet of all current motor vehicles, workshop manual, and owner's manual or Pertinent portion thereof when required for mediation or adjudication proceedings for non-conformity complaints. Section 5. Rotontion of Service of other Government Agencies or Qualified Independent Entities to Ascertain Consumer Complaint Validity. In ascertaining the validity of the Consumer's complaint, the DTI shall request the ‘assistance from the pool of qualified personnel of the Technical Education and Skis Development Authority (TESDA) or any independent private entity. An independent qualified expert may be anyone ofthe following, 5.1, Technicians who have the highest or appropriate and relevant TESDA ‘national certification level. TESDA shall further develop competencies and certification programs for qualified experts to match current and future automotive technologies and to complement and broaden the expert's ski set 8.2. Experts coming trom the industry. 5.3. DTI accredited service and repair shops. Provided, however that experts above-mentioned shall not have any conflict of interest with respect tothe case, ions ‘Section 1. Soparability Clause. In the event that the provision of this Order is declared unconstitutional, the vaicty of the other provision shall not be affected by such deciaration. Page 6 of‘Section 2. Repealing Clause. The provisions of the Department Orders, rules ‘and regulations and other issuance of the implementing agency which are clearly inconsistent with this order are hereby repealed, modified or amended ‘accordingly. Section 3. Effectivity. This IRR shall take effect immediately after its publication in the Official Gazette or in at least two (2) newspaper of general circulation, whichever comes first, and copy thereof funished the Office of tre National ‘Administrative Register at the UP Law Center, University of the Philippines, Diliman, Quezon City, ‘Signed this 17° day of November, 2014 in Makati City. Recommended by: QiOO-~ vo VICTORIO MARIO A. 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