The Philippines Just Rewrote the Rules for Online Business: A Complete Guide to the Internet Transactions Act of 2023

October 28, 2025

The growth of e-commerce in the Philippines has been explosive, reshaping how Filipinos shop, sell, and connect. However, this rapid rise also exposed significant challenges—including scams, counterfeit goods, and unregulated platforms—that threatened consumer trust and market integrity. In response, the Philippine government enacted Republic Act No. 11967, the Internet Transactions Act of 2023, marking a pivotal shift in the regulatory landscape for online businesses. Alongside this, the issuance of DAO No. 25-07 S. 2025, which mandates the Philippine E-Commerce Trustmark, signals the government’s zero-tolerance approach to non-compliance and bad actors.

Understanding the Internet Transactions Act of 2023: A New Regulatory Framework

The Internet Transactions Act was enacted to address the fast-evolving challenges unique to online commerce. It holds digital platforms, sellers, and consumers accountable, introducing clear legal responsibilities that were previously vague or unenforced.

Key goals of the Act include:

Protecting consumers from fraud, counterfeit goods, and deceptive practices
Holding e-commerce platforms jointly liable for marketplace transactions
Improving transparency and accountability in online sales
Establishing a government-issued trust verification system for legitimate sellers
Facilitating consumer complaints and faster resolution mechanisms

By setting these standards, the ITA aims to create a safer, more professional environment for e-commerce growth that benefits all stakeholders.

Platform Accountability: No More Hands-Off Middlemen

Before the ITA, many e-commerce platforms distanced themselves from seller activity, positioning themselves merely as venues or “virtual malls” without responsibility for transactions. This allowed scams, fake sellers, and misleading products to proliferate.

Under the ITA:

Platforms such as Shopee, Lazada, TikTok Shop, Facebook Marketplace, and independent websites share legal responsibility for merchant compliance and consumer protection.
This means platforms must implement stringent merchant verification, monitoring, and swift takedown processes.
Platforms face fines and penalties for allowing illegal listings or unsafe goods to remain active.
To maintain platform integrity, seller fees might increase, or more rigorous onboarding procedures be enforced.

This shift restores consumer confidence and levels the competitive landscape by holding all participants accountable.

Swift Government Enforcement and Takedown Powers

Consumers and honest sellers now have stronger government backing. The Department of Trade and Industry (DTI), empowered by the ITA, can:

Issue immediate takedown orders against illegal, counterfeit, or unsafe online products or services, without prior hearings.
Enforce blacklisting of non-compliant sellers or platforms.
Impose fines up to ₱1,000,000 for grave violations.
Oversee consumer protection by facilitating complaint filing and resolution.

This rapid enforcement capability means businesses must prioritize compliance or risk sudden marketplace exclusion.

Seller Obligations: 100% Accountability for Product Accuracy and Quality

The Act places heavy responsibility directly on sellers themselves:

Sellers must guarantee the accuracy of product specifications, images, descriptions, and prices.
Providing defective, counterfeit, or misleading products subjects sellers to fines and full liability for refunds, repairs, or replacements.
Sellers must establish and maintain a robust customer complaint-handling process that is accessible and fair.
Transparency about seller identity and business registration is mandatory.

These obligations raise the bar for professionalism and consumer trust in online commerce.

Addressing Bogus Buyers: Shared Responsibilities for Consumers

Interestingly, the ITA also targets problematic consumer behavior. Fake buyers who:

Place orders, but cancel at the last minute
Abuse return policies or exploit sellers

face penalties under the Act. This balanced approach seeks fairer relations and reduces losses in the supply chain.

Foreign Sellers: No More Exemptions From Philippine Law

E-commerce knows no borders, and Philippine lawmakers have closed a major loophole:

Foreign sellers without a Philippine office but selling to Filipino buyers are equally subject to the ITA’s rules.
They must register properly, comply with product standards, pay taxes, honor returns policies, and be identifiable to consumers.
This levels the playing field for Filipino sellers who must meet these regulations and allows trusted foreign businesses to compete on equal terms.

The E-Commerce Philippine Trustmark: Mandatory for All Online Sellers by the End of 2025

Perhaps the most transformative part of recent reforms is the mandatory E-Commerce Philippine Trustmark system, instituted by DAO No. 25-07 S. 2025.

What Is the Trustmark?

A government-issued certification verifying that an online business complies with consumer protection laws, data privacy, and security standards.
It is distinct from any internal platform badges (like “Top Seller” or “LazMall” on Shopee).
The Trustmark allows consumers to identify legitimate, trustworthy sellers across any digital platform.

Who Needs the Trustmark?

Every online seller or marketplace operator selling to Philippine consumers.
Applies to all platforms, including social media shops, marketplaces, and independent websites.

Trustmark Validity and Cost

Annual certification costing ₱1,130, renewable every year.
Requires proof of valid business registration, a complaint-handling mechanism, and adherence to online business laws.

Compliance Deadline

Sellers and platforms must secure the Trustmark by December 31, 2025.
Operating without it exposes businesses to fines, takedowns, and blacklisting.

How to Prepare Your Business for Compliance

Implementing the changes mandated by the ITA and Trustmark requires organizational commitment:

Legitimize Your Online Business

Ensure your business is fully registered with DTI or SEC, that your licenses are current, and that your tax obligations are met.

Audit Product Listings

Review all product descriptions, images, pricing, and specs for accuracy and legality.

Develop a Customer Service Program

Establish clear communication, return policies, and complaint resolution mechanisms.

Secure and Maintain the Trustmark

Engage with government portals early, prepare documentation, and apply for the Trustmark within the set deadlines.

Train Staff and Partners

Educate marketing, sales, and operations teams about the new rules and their roles.

Consequences of Non-Compliance

Ignoring these new rules risks:

Immediate removal of online listings and account suspension.
Loss of customer trust and reputational damage.
Fines up to ₱1,000,000 per violation.
Legal challenges or additional sanctions from consumer protection agencies.
Permanent blacklisting, barring return to Philippine e-commerce.

Final Insights

The Internet Transactions Act of 2023 and the mandatory Philippine E-Commerce Trustmark usher in a new era where only compliant, transparent, and customer-first businesses thrive online. Early adoption of these reforms not only avoids penalties but builds brand loyalty and long-term growth.

As December 31, 2025 approaches, the choice is clear:

Update your business registration
Audit your product listings
Secure your Trustmark certification

Lead the future of digital commerce in the Philippines by embracing compliance today.

Need Expert Support?

Navigating the evolving laws requires expertise and ongoing support:

Comprehensive business registration services, including tax and local permits.
Guidance on Trustmark application and annual renewal.
Full compliance audits of listings, website policies, and customer service.
Training for teams on new rules and risk mitigation.

Crisis management and response strategies for takedown orders or complaints. Contact our team for tailored assistance in business registration, E-Commerce Trustmark applications, and compliance management: