What you need to know about the Philippine Lemon law

Cars that enter the Philippine automotive market aren’t always perfect, a few defects make their way past quality control now and then, and eventually land in the hands of a customer. With that said, having a “lemon” unit can be a great pain as it will require repeated visits to a service center to fix a reoccurring problem. This is why the RA 10642 otherwise known as the Philippine Lemon Law exists to give consumers full protection when it comes to their rights against business and trade practices that are deceptive, unfair, and detrimental to consumers and the public interest. 

This law took into effect in 2014 and serves to protect your consumer rights. It covers a wide range of passenger vehicles in the form of hatchbacks, sedans, crossovers, and even large SUVs. However, it is important to note that this law does not yet cover motorcycles, buses, delivery trucks, and heavy equipment.

To quickly gloss over how the law can protect your consumer rights, it protects owners of brand-new vehicles that were purchased in the Philippines within 12 months after the date of delivery.  It also covers the first 20,000 kilometers of operation after the date of delivery of the vehicle to the customer or the 12 months whichever comes first. This gives the owner the right to report any non-conformity with the vehicle’s manufacturer or with the distributor’s standards of specifications. 

If the owner of the vehicle finds that their car is defective, then they may invoke their Lemon Law rights. It is important to note, that these rights can only be invoked within the 12 months or the 20,000 kilometers of operation of the vehicle. Aside from that, at least four attempts must be made to fix the problem by the manufacturer, distributor, dealer, or retailer for the same complaint. 

In its most simple definition, a lemon car is a brand new vehicle that has either had several manufacturing defects or has a recurring problem that is related to a specific part that affects its safety, value, or utility. Note that this problem should take at least four attempts to fix by the dealership, manufacturer, retailer, or distributor as stated by the law. If the problem is fixed within four attempts then it can be classified as a warranty claim.

As previously mentioned, the Lemon Law currently covers brand new vehicles that are less than a year old and have less than 20,000 kilometers on their odometer. However, there are a few causes in the law that you should take notice of if you wish to utilize the Lemon Law for your consumer rights.

• Noncompliance by the consumer under the vehicle’s warranty

• Modifications to the vehicle not authorized by manufacturer, distributor, dealer, or retailer

• Abuse or neglect of the brand new vehicle

• Damage the vehicle due to accident or force majeure

If your vehicle falls under this category, you might not be protected under the coverage of the law. Note that if you do go through with a complaint and it is found that your vehicle does not meet the nonconformity requirements, then you as the customer will need to reimburse the manufacturer, distributor, dealer, or retailer for the costs incurred for validating your complaint.

While your vehicle is being repaired for these problems, a reasonable daily transport allowance may be claimed by the customer to compensate for the non-usage of the vehicle. The amount that the customer can ask for should cover the transportation needed for the person to go from his or her residence to his or her regular workplace and vice versa.

Aside from this, If your vehicle meets the criteria to be considered as defective from the factory, the Department of Trade and Industry can direct the manufacturer, distributor, dealer, or retail to grant either of the following remedies to the consumer:

• Replace the car with a similar or comparable vehicle in terms of specifications and values

• Accept the return of the motor vehicle and pay the consumer the purchase price plus other charges

While the Lemon Law primarily applies to brand new vehicles a new House Bill wants to change that by applying the same laws for new cars for the used market. House Bill (HB) No.443 or the Used Car Lemon Act functions similarly to the Lemon Law as the bill aims to protect the rights of the consumers when it comes to the sale of second-hand motor vehicles. The bill also covers any defects or safety issues that could cause harm to individuals when it comes to the sale of a used car. 

It is important to note that this bill mainly deals with dealerships and retailers. There are sections in it for private sellers but these rules aren’t as strict as it states that the private seller must disclose the history of the vehicle to the buyer. 

We all know that buying a new car can be an expensive endeavor. This is why you should know your consumer rights so that you can be protected from unlawful treatment or misconduct. Knowing your rights can even help save you from a faulty product that will cost you a lot of money down the road. With that said, if your car meets the criteria mentioned above we recommend reaching out to your dealership to have these issues resolved.