E-Commerce MOU Emerges as Self-Regulation Model to Ensure Safe Online Space

E-Commerce MOU Emerges as Self-Regulation Model to Ensure Safe Online Space

September 11, 2024

The Department of Trade and Industry (DTI) has highlighted the E-Commerce Memorandum of Understanding (MOU) between brand owners and online platforms—facilitated by the Intellectual Property Office of the Philippines (IPOPHL) and the DTI’s E-Commerce Team—as a pioneering example of self-regulation in e-commerce.

At the Advertising Industry Summit held last week in Makati, at a panel tackling ways to safeguard consumers in the digital space, DTI Undersecretary for E-Commerce Group Mary Jean T. Pacheco said the collaborative MOU enables brand owners to directly file a complaint with market platforms which will then act on the resolution and removal of the infringing content.

The panel brought to light the challenges of government and groups like the Advertising Standards Council in addressing fraudulent trade practices. In this fight, Pancheco stressed the role of the Internet Transactions Act (ITA) of 2023 which provides regulations to uphold consumer rights and IP rights among others.

She shared that the ITA recognizes the agility and effectiveness of the private sector in making a safe and thriving online space. Specifically, it allows the government to establish an industry-led body responsible for developing the E-Commerce Philippine Trust Mark, which certifies digital companies adhering to the ITA’s standards of safe and secure internet transactions.

The role of platforms

More importantly, the ITA gives the DTI teeth to impose penalties on merchants and online marketplaces found guilty of deceptive practices.

Voicing concerns over fake products in big marketplaces, Shoppedia Managing Director Neil La-as emphasized the responsibility of platforms in prevention.

“Why are these fake items proliferating in e-commerce platforms? … How could you protect consumers? It’s on your platform… [you should have] your self-regulatory body embedded in the very DNA of your business model…,” La-as added.

Despite investments in cybersecurity and expanded KYC measures, La-as noted a significant mistrust in e-commerce, evidenced by 78% of Shoppedia’s customers preferring cash on delivery.

From competitors to collaborators

For her part, Pacheco assured that with the ITA, a regulatory framework is in motion to protect the rights of consumers while also balance them against the interests of online merchants and platforms.

“We are making sure that at the end of the day, we have more buyers buying online and more sellers selling online because we want to grow e-commerce,” Pacheco said, citing the growth opportunities e-commerce has provided.

For his part, UnionBank Chief Marketing Officer Albert Cuadrante, said it is the “collective responsibility” of digital economy leaders to band together. “The ways of working have been challenged. The traditional competitors have been collaborators,” Cuadrante said, citing the bank’s collaboration with other financial service providers like GCash.

For GCach Chief Marketing Officer Neil Trinidad, the collective responsibility also enjoins consumers to do their part and learn how to protect themselves. “Driving safety and security is everyone’s responsibility. It’s the role of businesses, the role of brands, but also the role of end-users.” he said.

Jocel De Guzman, co-founder of ScamWatch Pilipinas, said it is advocating for an “attitude change” among consumers, encouraging heightened caution when dealing with personalities online. As the government’s citizen arm in educating Filipinos against cyber fraud, the group’s vision is to have one volunteer per Filipino home to improve the cyber hygiene of household members.

For his part, Director General Rowel S. Barba emphasized the commitment of the agency towards finding the right formula for cooperative regulation.

“Cooperative regulation among involved players, with the backing of government, can offer agility and a more solid effort. With the rapid growth and increasingly sophisticated scams online, it is hard to put the burden of regulation on just government, brand owners or marketplaces. We welcome more partners to come forward for a stronger front against fakes and other frauds,” Barba said.

The E-Commerce MOU is cited by the Transnational Alliance To Combat Illicit Trade (TRACIT) as a model in the ASEAN in fighting counterfeit alcohol products.

At present, the MOU has 41 signatories from brand owners, industry groups and marketplaces. # # # (Janina Lim, Information Officer III)