Senator Pia S. Cayetano's Intervention During the Committee on Trade, Commerce, and Entrepreneurship hearing on the proposed
Internet Transactions Act

Sen. Cayetano (to Philippine Competition Commission's Atty. Faye Concez-De Sagon): You mentioned that one of the things you look at is that there is not an unfair competition or advantage for online sellers versus brick and mortar stores, did I hear you right?

Atty. Concez-De Sagon: That is in terms of the regulatory framework we are establishing, Madam Chair, much like what was mentioned earlier. There may be parts of the registration process, for example, that we may be online for everyone. If we are doing it online, for example, if we're going to do online registration for online sellers, it might be advantageous for us to do the same for brick and mortar sellers, if that's possible. At least to facilitate.

Sen. Cayetano: I see your point. But I assumed that, because if you are gonna open it to Philippine entrepreneurs, why would you just open it to those who just have an online business. So that's exactly what you are ensuring, that you don't open it to a particular segment, you open it to all, whether they have existing brick and mortar stores or they don't, right?

Atty. Concez-De Sagon: That's correct, Senator Cayetano.

Sen. Cayetano: Obviously, your job requires that you ensure that there is no regulatory intervention or regulation that makes it unfair competition, that's basically your job, right?

Atty. Concez-De Sagon: That's right.

Sen. Cayetano: Okay. So a provision that holds an online platform solidarily liable for any, I guess, erroneous sale of products or bad practice... that holds them solidarily liable with an online merchant would put them at a disadvantage because I am not aware of any law that holds the malls solidarily liable with any of their store tenants, correct?

Atty. Concez-De Sagon: That is correct, Senator Cayetano. That could be a red flag for us.

Sen. Cayetano: That's in the House version also, so did you flag that? Atty. Concez-De Sagon: We made a general comment so far about the regulatory procedures that might impair competition in the market under this legislation. Sen. Cayetano: I'm just saying, it's something I noticed right away. And I don't think I'm a correct anti-competitive expert. So I'd really like you to take a closer look at this. Because that provision really struck me. It's like really glared at me, like, "Whoa, why would you do this?" And then it would entail... That just opens up a whole lot of responsibilities for any platform.

I am an entrepreneur at heart, just for the information of the body. I was a tiangge queen... I made more money in the tiangge while I was working at the same time as a lawyer. So just to give a little bit of background why this is of so much interest to me.

And, in conversations I have had about this, the desire is to make this a safe place and to level up the kind of sellers. But, what do you mean by quality of sellers? There's tiangge people and they're not any less sellers than somebody who has a store in the mall. So all of these things have to be defined. That's why I try to listen very intently to the words that we use because we might have different objectives and at the end of the day, put some at a disadvantage over others.

So, I bring that up because we really want... I was telling DTI in a previous discussion I had with them, I am not aware that we have been able to regulate the tiangge market and a lot of people have different opinions about it. And then we jump into online, so again, equal playing field din, diba? We regulate one, we promote one. Let's regulate all, promote all. But then, there's also that thought that, "can we really... promote online?" So are you then willing to incentivize that by regulating less? We really have to go into the details of this to determine na are we all on board with what we want to do? At what point is it anti-competition but at what point do you consider it acceptable because it's incentivizing the kind of business that we like?

For those who sell their products in the provinces, this might be their only opportunity to sell it in the metropolitans and worldwide. So on that note, it might be an acceptable exception to the anti-competitive laws that we have. I am just bringing that up so that we have all our experts here weighing in on this.

I don't have any conclusions yet, although I do have some thoughts on it. And it will come together hopefully for all of us as we move along. Thank you, Mr. Chair.