JUNE 22, 2015

NR # 3871

House approves proposal to unlock mobile wireless

devices for consumer protection
The House of Representatives has approved on third and final reading a proposal
promoting consumer protection on the purchase of mobile communication devices by
allowing consumers to unlock the mobile wireless devices prior to the expiration of the
lock-in period under the service contract.
House Bill 5790, or the proposed Consumer Protection on Mobile Communication
Service Contract, prohibits the provision of a lock-in period in a Mobile Communication
Service Contract.
The bill, principally authored by Rep. Francis Gerald A. Abaya (1 st District, Cavite),
aims to protect the general welfare and establish standards of conduct for business and
industry in line with the State recognition of the vital role of information and
communications technology in nation-building and also the provisions of Article 2, Title I
of the Consumer Act of the Philippines.
Abaya, a vice chairman of the House Committee on Information and
Communications Technology, said the practice by mobile phone and data service
providers of locking devices as part of a wireless contract is one of the significant sources
of consumer frustration with wireless services.
Although there exist independent devices or services from third parties that unlock
the mobile device, this process would normally void the warranty of the mobile device.
Device locking makes it difficult for consumers to take advantage of the competitive
offers available in the market. Furthermore, it limits the ability of the consumers to avoid
roaming charges while travelling abroad, because it prevents them from using another
service providers service, said Abaya.
Ultimately, he said the proposal aims to contribute to a more dynamic marketplace
by promoting consumer choice and wireless competition.
The bill provides that a mobile communication and data network service provider
that provides a locked device to the consumer, as part of a subscription contract, shall for
subsidized devices, unlock the communication device or give consumers the means to
unlock the device at the rate provided by the service provider or any of its designated
service agent, upon request prior to the expiration of the lock-in period of the device.
After the lock-in period, unlocking of the device shall be free and automatic, the bill
provides.

The measure further provides that for unsubsidized devices, the device shall be
unlocked upon purchase.
The measure refers to lock-in period as the term of contract between the service
provider and the consumer wherein the latter must maintain a monthly subscription at an
agreed period to the exclusion of other service providers.
The bill imposes a fine of P5,000 to P500,000, upon the discretion of the court, on
violators of the Act. Likewise, it provides for the suspension of the operation of erring
dealers, retailers or sellers.
The Department of Trade and Industry (DTI), in coordination with the National
Telecommunications Commission (NTC) and other concerned agencies shall promulgate
the Implementing Rules and Regulations (IRR) 90 days after the effectivity of the Act.
House Bill 5790 substituted HB 5027 and is co-authored by Reps. Joel Roy R.
Duavit, (1st District, Rizal), Mariano Michael M. Velarde, Jr. (Party-list, BUHAY), Xavier
Jesus D. Romualdo (Lone District, Camiguin), Jonathan A. Dela Cruz (Party-list,
ABAKADA), Delphine Gan Lee (Party-list, AGRI), Monique Yazmin G. Lagdameo (1 st
District, Makati City), Terry L. Ridon (Party-list, KABATAAN) and Antonio L. Tinio
(Party-list, ACT TEACHERS). (30) rbb