Bar Drills on the Internet Transactions Act of 2023

The Internet Transactions Act of 2023 (R.A. 11967), or simply ITA, is a landmark e-commerce law that governs digital platforms, online merchants, and consumer protection in the Philippines. It was signed into law after the 2024 Bar Exam cut-off date (June 20, 2023), which means it is covered in the 2025 Bar Exams.

This quiz consists of 10 Bar-style scenario questions highlighting key points of the ITA. You may practice your Bar essay writing skills in the comment box (optional). Choose the best answer, and good luck!

Orbotix, Inc. is incorporated under the laws of Hong Kong and operates Orbotix Nexus Entertainment (ONE) in Hong Kong, Taiwan, Malaysia, and Thailand. ONE is an internet-based platform offering various content and services, such as an online community and gaming system. A ONE account is required to participate in the online community and avail ONE’s services. Payments are made using funds from the ONE online wallet associated with the account, which can be funded using a credit or debit card. ONE is available to persons in the Philippines. Orbotix does not have a physical presence in the Philippines. ONE employees are located in Hong Kong, while its servers are based in the United States. PlayVerse 3D is Orbotix’s latest gaming technology, which offers a variety of games that can enhance learning skills. Those with ONE accounts can access portions of the PlayVerse games and other digital content. Is Orbotix required to obtain a license to do business from the Securities and Exchange Commission to make PlayVerse 3D available in the Philippines?

Yes, because any foreign entity transacting with Filipinos online must be registered with the SEC under the Internet Transactions Act.

Yes, Orbotix is doing business in the Philippines by offering content and digital services to the Philippine market through the ONE platform.

No, because PlayVerse 3D is digital content accessed online and the Internet Transactions Act allows foreign digital platforms to operate without a physical presence in the country.

No, because Orbotix operates entirely abroad, and access by Philippine users does not constitute doing business in the Philippines.

None

Kevin, a college student, browsed the listings on TradeIt.ph, a popular online marketplace platform. He found a post by Carla, a fellow student, who was selling her personal DSLR camera for ₱20,000. Carla indicated in her profile that RFS (reason for sale) is that she is upgrading her camera to a newer model for professional engagements. Kevin proceeded with the purchase using TradeIt.ph’s in-platform payment feature. When the camera arrived, it was defective and had visible internal water damage. Kevin tried to contact Carla, but she stopped responding. He then filed a complaint against TradeIt.ph, seeking enforce its it subsidiary liability under Section 26 of the Internet Transactions Act for failing to verify Carla’s listing and identity. Can Kevin validly invoke the Internet Transactions Act to hold TradeIt.ph liable?

No, because absent contrary proof, TradeIt.ph is presumed to have exercised ordinary diligence in the performance of its obligations under the Internet Transactions Act.

No, because the transaction is a Consumer-to-Consumer (C2C) transaction and is not covered by the Internet Transactions Act.

Yes, because TradeIt.ph processed the payment and received commission thereon. Therefore, became a party to the transaction.

Yes, because TradeIt.ph facilitated the online transaction and should have screened the seller’s listing.

None

Loren bought a wireless speaker from MegaMart.PH, a popular e-commerce platform. The product was listed under a seller named TechWorld, which claimed to be based in the Philippines. Upon receiving the item, Loren discovered it was defective and falsely advertised. She contacted MegaMart.PH to file a complaint and seek assistance in pursuing TechWorld, but the seller's contact information was inaccessible. MegaMart.PH claimed it had relied on the seller’s submitted registration documents, which included a false Philippine address and a revoked business registration. Loren then filed an administrative complaint and sought to hold MegaMart.PH subsidiarily liable under the Internet Transactions Act. MegaMart.PH presented documentation showing that it had: (i) collected all the required seller registration details; (ii) verified them through its internal verification team; and (iii) had no prior notice that the seller’s information was false. Is MegaMart.PH subsidiarily liable for the damage Loren suffered?

Yes, because the seller gave false information and the platform is automatically liable in such cases.

No, because the platform relied in good faith on submitted documents and exercised ordinary diligence in verifying them.

No, because e-commerce platforms does not have any contract with the buyers. Its contract is with the merchants who use its services.

Yes, because the seller had no valid legal presence in the Philippines, and the platform facilitated the transaction.

None

“RideQuick,” a mobile app, facilitates Philippine rides. It lacks any in-app mechanism for riders to report driver misconduct. A passenger who experienced harassment reports it via Facebook but couldn’t reach RideQuick directly. Which of the following is true under R.A. 11967?

RideQuick is only subject to subsidiary liability for redress failures.

RideQuick is compliant, redress mechanisms includes official social media channels where complaints can be reported.

Section 21 doesn't apply because transportation services are not covered by the Internet Transactions Act.

RideQuick violated Section 21 by not providing an effective and responsive redress mechanism.

None

“SkinGlow Max,” a skin whitening injection, was banned by the FDA for being dangerous and unregistered. Despite this, several listings for the product appeared on the e-commerce platform E-Bodega. A consumer advocacy group emailed E-Bodega, providing the official FDA advisory declaring SkinGlow Max unsafe. Despite this, “SkinGlow Max” listings remained online for three more weeks. During that time, Julie, a buyer, used the product and suffered severe health complications. She filed a complaint against both the seller and E-Bodega, alleging that the platform’s inaction made it solidarily liable. In its defense, E-Bodega argued that its liability, if any, is merely subsidiary, and it cannot be held liable unless all remedies against the e-retailer are first exhausted. Is E-Bodega’s argument correct?

Yes, because digital platforms are only subsidiarily liable under the Internet Transactions Act. The primary liability lies with the e-retailers.

Yes, because liability of digital platforms requires a finding of gross negligence and exhaustion of remedies against the seller.

No, because all e-marketplaces are solidarily liable for any harm caused by products sold on their platform.

No, because solidary liability arises if a platform fails to act expeditiously after notice that a product is prohibited or dangerous.

None

Marco purchased a gaming keyboard from EZBuyHub, an e-commerce platform, from a merchant named “TechTrendz.” Upon delivery, Marco discovered that the item was a counterfeit and significantly different from what was advertised. He filed a complaint via EZBuyHub’s dispute channel, and demanded the full name, address, and contact number of “TechTrendz” so he could file a case. EZBuyHub refused to disclose TechTrendz information. Marco argues that under the Internet Transactions Act, the platform is required to maintain a list of all online merchants registered under their platform, and provide the seller’s information upon verified request. May Marco compel EZBuyHub to disclose specific information about TechTrendz?

Yes, the Internet Transactions Act mandates that all merchant information be publicly available at all times.

No, because disclosure is only required when a subpoena is issued by a competent authority pursuant to a sworn complaint.

Yes, because verified consumer complaints are sufficient basis to compel the release of seller data.

No, because online platforms are protected under the Data Privacy Act and cannot release the sensitive personal information of both merchants and buyers.

None

ListItNow is an online site which allows users to post goods and services for sale. However, it does not participate in payment processing, delivery, or dispute resolution. It also does not regulate nor monitor lstings or completed transactions. Several listings for unlicensed pharmaceutical products were posted, and one buyer suffered injury after using a counterfeit drug. A complaint was filed with the DTI alleging that ListItNow violated its obligations under the Internet Transactions Act. ListItNow claims that it cannot be held liable under the Act, not being an e-marketplace since the transaction happened directly between buyer and seller, and that it takes no part thereon. May ListItNow’s be held liable under the Internet Transactions Act?

Yes, for failure to exercise ordinary diligence in complying with mandatory obligations under Section 22.

Yes, but only if the consumer sues both the platform and the seller jointly.

No, because the ListItNow had no control over the transactions between independent buyers and sellers.

No, unless it was shown that the platform earned a commission from the sale.

None

Liza ordered a customized birthday cake from BakeBee Online, an e-commerce platform selling baked goods. The cake was scheduled for next-day delivery, and Liza paid in full using BCash. On the morning of delivery, BakeBee informed her that the cake had already been picked up by SwiftGo Express, a third-party logistics provider. Just before delivery, Liza canceled the order, saying that the intended recipient was rushed to the hospital due to a medical emergency and that the celebration had been called off. She refused to accept the delivery and demanded a full refund, which BakeBee refused. Liza insists that she, as a consumer, has the right to cancel purchases if circumstances change beyond her control and without any fault on her part. Is BakeBee correct in refusing to refund Liza?

No, because Liza is a consumer and the medical emergency is force majeure which justifies cancellation under the Internet Transactions Act.

Yes, because BakeBee had already transferred the item to a delivery service and the product is perishable, so the sale was deemed completed.

No, because BakeBee failed to present a no-cancellation policy or cancellation fee clause.

Yes, because even if the reason appears justified, the cancellation did not follow the conditions set under the Act.

None

“FashionFiesta,” an online clothing marketplace, collects users’ addresses and mall purchase history. It neither encrypts the data nor obtains user consent for data retention. A data breach exposed thousands of addresses. Under R.A. 11967, how is FashionFiesta liable?

FashionFiesta is not liable. Third-party hackers, not the platform, caused the breach.

FashionFiesta is not liable. There’s no specific data‑protection provision in the Act.

FashionFiesta is liable only under the Data Privacy Act, not the Internet Transactions Act.

FashionFiesta liable for failing to exercise ordinary diligence.

None

“GlobalGadgets,” based in Germany, sells smart home devices through its bundled international app. Philippine users can order and pay via credit card, and the devices are shipped into the Philippines. GlobalGadgets has no local office or representative. Is GlobalGadgets subject to the Internet Transactions Act?

Yes, because it “avails of the Philippine market” and has minimum contacts.

No, because B2B transactions are excluded from the Act’s coverage.

No, because GlobalGadgets is based abroad and not physically present in the Philippines.

Yes, but only if it employs local delivery partners.

None

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