This body/agency shall regulate the preparation and sale Statement 2: On the matter of adulterated cosmetics, the

of meat, fresh fruits, poultry, milk, fish, vegetables and term "hair dye" includes eyelash dyes or eyebrow dyes.
other unprocessed food for public consumption. Both statements are incorrect
Local government units
Of the eight (8) basic rights of consumers, this right
“Pyramid sale scheme” refers to a sales device whereby assures consumers to be protected against marketing of
a person, upon condition that he makes an investment, goods which are injurious to health and life.
is granted by the manufacturer of his representative a Right to safety
right to recruit for profit one or more additional persons
who will also be granted such right to recruit upon All consumer products domestically sold whether
condition of making similar investments. This scheme is manufactured locally or imported shall indicate the
also known as: following in their respective labels of packaging, among
Chain distribution plan others, except:
its price
This the law that aims to protect buyers on the purchase
of brand new motor vehicles. All actions or claims accruing under the provisions of the
R.A. 10642, The Philippine Lemon Law Consumer Act of the Philippines shall be filed within
_____________ from the time the consumer transaction
If a consumer, manufacturer, distributor or seller is not was consummated or the deceptive or unfair and
satisfied with the decision of the Secretary of the unconscionable act.
Department concerned, he/she/it may file an appeal to Two (2) years
the:
Court of Appeals If a customer has complaint/s about manufactured
products, the proper agency to file such complaint/s is
Of the eight (8) basic rights, this right refers to protection the:
of consumers against dishonest or misleading Department of Trade and Industry
advertising or labelling and the right to be given the facts
needed to make an informed choice. The Hearing Office of the Department of Trade and
Right to information Industry has ____ working days to decide the case from
the date it was submitted for decision.
If customer has complaint/s about telephone rates, Twenty (20)
cellphones, TV and radio broadcasts, the proper agency
to file such complaint/s is the: Under this right, consumers should be compensated for
National Telecommunications Commission misrepresentation, shoddy goods or unsatisfactory
services; defective goods should be replaced or the
Under R.A. 10642, The Philippine Lemon Law, in case money be refunded by the seller or dealer.
the returned motor vehicle be made available for resale, Right to redress
the manufacturer, distributor, authorized dealer or
retailer shall, prior to sale or transfer, disclose in writing The entire Mediation Proceedings before the
to the next purchaser of the same vehicle the following Department of Trade and Industry under R.A. 7394 is
information, except: ____ working days.
The identity and other personal circumstances of the first Ten (10)
(1st) buyer
Under the provisions of R.A. 10642, The Philippine
If a customer has complaint/s about telephone rates, Lemon Law, there must be at least _______ separate
cellphones, TV and radio broadcasts, the proper agency repair attempts by the same manufacturer, distributor,
to file such complaint/s is the: authorized dealer or retailer for the same complaint, and
National Telecommunications Commission the non-conformity issue remains unresolved, the
consumer may invoke his or her rights.
S1: If a complaint is filed with the Department of Trade Four (4)
and Industry and it finds out that it has no jurisdiction
over the subject matter of the case, it will dismiss the If a customer has complaint/s about food in restaurants,
complaint. eateries and sidewalk vendors as well as on regulation
S2: On the matter of adulterated cosmetics, the term of practice relative to weights and measures, the proper
"hair dye" includes eyelash dyes or eyebrow dyes. agency to file such complaint/s is the:
False, False City Health Office of the concerned Local Government
Units (LGUs)
Statement1: If a complaint is filed with the Department of
Trade and Industry and it finds out that it has no
jurisdiction over the subject matter of the case, it will
dismiss the complaint.
The implementing agencies of R.A. 10620, The Toy and True, False
Game Safety Labelling Act, are the:
Department of Health (DOH) and Department of Trade S1: All consumer products sold in wholesale (should be
and Industry (DTI) retail) shall bear an appropriate price tag, label or
marking indicating the price of the article.
This refers to a motor vehicle that is identical or S2: Some consumer products can be sold at a price
reasonably equivalent to the motor vehicle to be higher than that stated in the price tag.
replaced, in terms of specifications and values, subject False, False
to availability, as the motor vehicle existed at the time of
purchase. This law provides protection to consumers against
Comparable motor vehicle hazards to health and safety and deceptive, unfair and
unconscionable sales acts and practices.
The presence of any of the following circumstances R.A. 7394, The Consumer Act of the Philippines
would disqualify a buyer from the provisions of R.A.
10642, The Philippine Lemon Law, except: This the law that aims to provide protection to
consumers by stabilizing the price and supply of basic
Abuse or neglect of the brand new motor vehicle necessities and prime commodities.
Non-compliance by the consumer of the obligations R.A. 7581, The Price Act
under the warranty
Modifications not authorized by the manufacturer, This means the date stated on the label of food, drug,
distributor, authorized dealer or retailer cosmetic, device or hazardous substance after which
None of the choices they are not expected to retain their claimed safety,
Damage to the vehicle due to accident or force majeure efficacy and quality or potency and after which it is no
longer permissible to sell them.
R.A. 9994, The Senior Citizen, provides for and entitles Expiry date
a senior citizen to a discount of ___ on utility, prime and
basic commodities. This refers to a product which fails to comply with an
20% applicable consumer product safety rule which creates a
substantial risk of injury to the public.
In the labelling of cosmetic products, following additional Substandard product
requirements may be required, except:
price S1: R.A. 10642, The Philippine Lemon Law, covers
precautions or contra-indications brand new motorcycles that are to be in non-conformity
whether or not it may be an irritant with the standards or specifications of the vehicle’s
expiry or expiration date manufacturer or distributor.
S2: Under R.A. 10909, The No Shortchanging Act,
S1: In case of breach of express warranty by the seller, business establishments are not allowed to or are
the said seller (not the consumer) has the right to elect restricted from giving an amount greater than the
whether to make a refund or replace the product/item sufficient change.
without charge of such product or part. False, False
S2: R.A. 10642, The Philippine Lemon Law, covers
second (2nd) hand motor vehicles that are to be in non- The implementing agency of R.A. 10642, The Philippine
conformity with the standards or specifications of the Lemon Law, is the:
vehicle’s manufacturer or distributor. Department of Trade and Industry (DTI)
False, False
No business entity shall conduct any home solicitation
If a customer has complaint/s about processed foods, sale of any consumer product or service without first
drugs, cosmetics, and household products with obtaining a permit from the ____________.
hazardous substances, the proper agency to file such Department of Trade and Industry
complaint/s is the:
Department of Health This refers to a tribunal or adjudicative body that
appears to be a court of law, to the extent that it
This is the right of consumers to acquire the knowledge performs functions discharged by regular courts.
and skills necessary to be an informed consumer. However, this body is not a regular court and is not
Right to consumer education bound by the technical rules of procedure applicable to
courts of law.
S1: A manufactured food product that has passed its Quasi-judicial body
expiry date could be regarded as an adulterated food.
S2: Implied warranties refer to all written warranties or S1: Under R.A. 10909, The No Shortchanging Act, any
guarantees issued by a manufacturer, producer, or business establishment which sells goods or provides
importer shall be operative from the moment of sale. services are allowed to ask the consumers for
permission to be exempted from the provisions of this Statement 2: Liquidator shall refer to the natural person
Act for the reason of non-availability of small bills or or juridical entity appointed as such by the court
coins. pursuant to these Rules and entrusted with such powers
S2: Exclusive distributorship agreements among and duties
suppliers and manufacturers are not covered by the False; True
Philippine Competition Act.
False, False Which of the following is true?
Rehabilitation plan shall be confirmed by the court after
This refers to any device, written, printed, affixed or approval of the creditors but not without approval or over
attached to a consumer product or displayed in a the objection of the creditors.
consumer repair or service establishment for the Rehabilitation plan shall be confirmed by the court if with
purpose of indicating the retail price per unit or service. approval of all the creditors
Price tag Rehabilitation plan shall be confirmed by the court if
without approval the creditors
The following are the administrative penalties under R.A. Rehabilitation plan shall be confirmed by the court after
7394, the Consumer Act of the Philippines, except: approval of the creditors, or even without approval or
Restitution or rescission of the contract without damages even over the objection of the creditors.
Imprisonment
How much is the minimum amount of debt for the court
What should be the remedy if the individual debtor is not to grant involuntary liquidation of individual debtor who is
insolvent but is expecting that he cannot pay his debt insolvent?
when they fall due? 1,000,000 or 25% of capital whichever is higher
Suspension of Payment
Which of the following is true?
Which of the following is incorrect in a voluntary The cram down rule applies to court supervised
liquidation? rehabilitation, pre-negotiated rehabilitation and out of
At any time during the pendency of court-supervised or court rehabilitation
pre-negotiated rehabilitation proceedings, the debtor The cram down rule applies to court supervised
may also initiate liquidation proceedings by filing a rehabilitation but not pre-negotiated rehabilitation and
motion in the same court where the rehabilitation out of court rehabilitation
proceedings are pending to convert the rehabilitation The cram down rule applies to court supervised
proceedings into liquidation proceedings. (T) rehabilitation and out of court rehabilitation but not pre-
An insolvent debtor may apply for liquidation by filing a negotiated rehabilitation
petition for liquidation with the court. The cram down rule applies to court supervised
An individual debtor whose properties are not sufficient rehabilitation and pre-negotiated rehabilitation but not
to cover his liabilities, and owing debts exceeding Five out of court rehabilitation
hundred thousand pesos (Php500,000.00), may apply to
be discharged from his debts and liabilities by filing a This law guarantees a timely, fair, transparent, effective
verified petition with the court of the province or city in and efficient rehabilitation or liquidation of debtors?
which he has resided for six (6) months prior to the filing Financial Rehabilitation and Insolvency Act of 2010
of such petition.
An individual debtor whose properties are not sufficient the involuntary liquidation of an individual debtor as
to cover his liabilities, and owing debts exceeding Five opposed to business?
hundred thousand pesos (Php500,000.00), may apply to the minimum amount of debt is 500,000
be discharged from his debts and liabilities by filing a
verified petition with the court of the province or city in The following are the not affected by Stay order, except?
which he has resided for three (3) months prior to the Any Criminal Action against individual debtor or owner,
filing of such petition. partner, director or officer of a debtor shall not be
affected by any proceedings commenced under FRIA
How many creditors is/are required to file a petition for To any form of action of customers of security market
voluntary liquidation of an insolvent individual debtor? participant to recover or claim money and securities
None entrusted to the latter in an ordinary course of business
Clearing or settlement of financial transactions through
How many creditors is/are required to file a petition for facilities of clearing agency duly authorized by
voluntary liquidation of an insolvent juridical debtor? appropriate regulatory agency
None Prohibit the debtor from making any payment of liabilities
outstanding as of commencement date except as may
Statement 1: Rehabilitation plan shall be confirmed by be provided herein
the court after approval of the insolvent debtor but not
without approval or over the objection of all creditors. The following are the not affected by Stay order, except?
To any form of action of customers of security market In accordance with concurrence and preference of
participant to recover or claim money and securities credit, this is a creditor whose claim against the debtor
entrusted to the latter in an ordinary course of business has asset pledged or attached to it and the fair value of
Suspend all action to enforce any judgment, attachment the former (claim) is greater than the fair value of the
or any provisional remedies against the debtor latter (asset)
Any Criminal Action against individual debtor or owner, Unsecured creditors with priority
partner, director or officer of a debtor shall not be Fully secured creditor
affected by any proceedings commenced under FRIA Partially secured creditor
Clearing or settlement of financial transactions through Unsecured creditors
facilities of clearing agency duly authorized by
appropriate regulatory agency The following are group of debtors, except?
Partnerships that are owned more than 50% by the
Insolvent shall refer to the financial condition of a debtor same person
that is? Single proprietorships that are owned by the same
I. Generally unable to pay its or his liabilities as person
they fall due in the ordinary course of business Corporations that are financially related to one another
II. Has liabilities that are greater than its or his Single proprietorships that are owned by the different
assets persons
III. Has liabilities that are less than its or his assets
Both I and II It is a rule indicating that the Rehabilitation plan
confirmed by the Court shall be binding upon the debtor
Statement 1: The suspension order shall lapse after 90 and all persons who may be affected by it, including
days without the proposed agreement being accepted by creditors whether or not such persons have participated
the creditors or as soon as such agreement is denied. in the proceedings, opposed the plan or whether or not
Statement 2: The pre negotiated rehabilitation plan shall their claims have been scheduled?
be approved by majority of the creditors and the Cram down rule
insolvent debtor without the need of confirmation by the
court. This refer to a plan by which the financial well-being and
False; False viability of an insolvent debtor can be restored using
various means including, but not limited to, debt
When shall suspension order lapse? forgiveness or debt rescheduling?
After three (3) months without the proposed agreement Rehabilitation plan
being accepted by the creditors or as soon as such
agreement is denied. (See the law) Statement 1: If rehabilitation is not feasible, it is in the
interest of the State to facilitate a speedy and orderly
Which of the following is not covered by FRIA? liquidation of these debtor’s assets and the settlement of
Jollibee Food Corporation their obligations.
ISB Accounting firm Statement 2: Liquidation is a process by which assets
Insolvent Juan Dela Cruz are converted to cash.
Metrobank Trust and Company True; True

In case of Involuntary Liquidation of Business Statement 1: If rehabilitation is feasible, it is in the

Organization, which of the following is correct? interest of the State to facilitate a speedy and orderly
Creditor whose claim is at least either Five Hundred liquidation of these debtor’s assets and the settlement of
Pesos (Php500,000) or at least twenty-five percent their obligations.
(25%) of the subscribed capital stock or partner’s Statement 2: Rehabilitation is a process by which assets
contributions of the debtor, whichever is higher, may are converted to cash.
apply for liquidation. False; False
The debtor files for the petition for liquidation contending
that total asset is not sufficient to pay the total liability Statement 1: The proceedings involved under FRIA are
Creditor whose claim is at least either One million pesos considered as in rem, which means that it binds the
(Php1,000,000) or at least twenty-five percent (25%) of whole world.
the subscribed capital stock or partner’s contributions of Statement 2: Under FRIA, debtor covers individual
the debtor, whichever is higher, may apply for debtor, a sole proprietorship, partnership and
liquidation. corporation such as insurance companies and banks
Three (3) or more creditors the aggregate of whose that has become insolvent.
claims is at least either One million pesos True; False
(Php1,000,000) or at least twenty-five percent (25%) of
the subscribed capital stock or partner’s contributions of In accordance with concurrence and preference of
the debtor, whichever is higher, may apply for credit, this is a creditor who is claiming for payment of
liquidation. his salaries and wages?
Unsecured creditors with priority I. There is genuine issue of fact on law on the
claim/s of the petitioner/s, and that the due and
In accordance with concurrence and preference of demandable payments thereon have not been made for
credit, this is a creditor whose claim against the debtor at least thirty (30) days or that the debtor has failed
has asset pledged or attached to it and the fair value of generally to meet its liabilities as they fall due.
the former is less than the fair value of the latter? II. A creditor, other than the petitioner/s, has
Fully secured creditor initiated foreclosure proceedings against the debtor that
will prevent the debtor from paying its debts as they
Which of the following is correct? become due or will render it insolvent.
In a voluntary liquidation of individual debtor, the debtor II only
is insolvent and the aggregate liability is at least five
hundred thousand An act or practice shall be deemed _______________
In a voluntary liquidation of individual debtor, the debtor whenever the producer, manufacturer, supplier or seller,
is solvent and the aggregate liability is at least one through concealment, false representation or fraudulent
million pesos manipulation, induces a consumer to enter into a sales
In a voluntary liquidation of individual debtor, the debtor or lease transaction of any consumer product or service.
is insolvent and the aggregate liability is at least one Deceptive
million pesos
In a voluntary liquidation of individual debtor, the debtor The suspension of payment as opposed to liquidation?
is solvent and the aggregate liability is at least five no minimum amount of debt is required
hundred thousand
Who will file the petition for involuntary rehabilitation?
Which of the following is correct? the creditor with aggregate claim of P 1,000,000 or 25%
In a rehabilitation of individual debtor, the debtor is of the Subscribed capital stocks whichever is higher
insolvent and the aggregate liability is at least five
hundred thousand In liquidation of individual debtor, which of the following
In suspension of payment of individual debtor, the debtor is correct?
is insolvent and the aggregate liability is at least one The creditor has to pay bond in case of voluntary
million pesos liquidation
In a suspension of payment of individual debtor, the The liquidation order shall be issued even without trial in
debtor is solvent and there is no minimum liability case of voluntary liquidation -
requirement The debtor has to pay bond in case of voluntary
In a rehabilitation of individual debtor, the debtor is liquidation
solvent and the aggregate liability is at least five hundred The liquidation order shall be issued after trial in case of
thousand voluntary liquidation

Statement 1: In a voluntary liquidation of individual Statement 1: The cram down rule applies to court
debtor, the debtor is insolvent and the aggregate liability supervised rehabilitation and pre-negotiated
is at least five hundred thousand. rehabilitation but not out of court rehabilitation
Statement 2: In a rehabilitation of individual debtor, the Statement 2: In liquidation of individual debtor, the
debtor is insolvent and the aggregate liability is at least liquidation order shall be issued even without trial in
five hundred thousand case of voluntary liquidation.
True; False False; True

Any creditor or group of creditors may initiate involuntary The court will appoint a rehabilitation receiver or
proceedings against the debtor by filing a petition for management committee when the either of the following
rehabilitation with the court if? are present except?
I. There is no genuine issue of fact on law on the There is actual or imminent Danger of loss of assets or
claim/s of the petitioner/s, and that the due and properties
demandable payments thereon have not been made for There is paralyzation of the business operations of the
at least sixty (60) days or that the debtor has failed debtor
generally to meet its liabilities as they fall due. There is error in the management of the debtor’s
II. A creditor, other than the petitioner/s, has business
initiated foreclosure proceedings against the debtor that There is gross mismanagement of the debtor or fraud or
will prevent the debtor from paying its debts as they wrongful conduct or willful violation of FRIA
become due or will render it insolvent.
Either I or II The court will appoint a rehabilitation receiver or
management committee when the either of the following
Any creditor or group of creditors may initiate involuntary are present except?
proceedings against the debtor by filing a petition for There is actual or imminent Danger of loss of assets or
rehabilitation with the court if? properties
There is gross mismanagement of the debtor or fraud or The court shall dismiss the petition for Rehabilitation in
wrongful conduct or willful violation of FRIA the following cases, except?
There is paralyzation of the business operations of the The debtor is insolvent
debtor The act is to defraud creditor
There is expected loss of properties and mistake in the There is Fraud or misrepresentation
management of the debtor’s business There is sham filing

The following are effects of stay order or suspension What will be the action of the court if the debtor is found
order, except? not to be insolvent and that there is merely sham filing
Suspend all actions or proceedings in court for the on the part of the debtor?
enforcement of claims against the debtor Dismiss
Prohibit the debtor from selling, encumbering,
transferring or disposing in any manner any of its How much is the minimum amount of debt for the court
properties, except in the ordinary course of business to grant voluntary liquidation of individual debtor who is
Prohibit the debtor from selling, encumbering, insolvent?
transferring or disposing in any manner any of its 500,000
properties even in the ordinary course of business
Suspend all action to enforce any judgment, attachment How much is the minimum amount of debt for the court
or any provisional remedies against the debtor to grant involuntary liquidation of an insolvent
corporation?
The following are effects of stay order or suspension 1,000,000 or 25% of subscribed capital stock whichever
order, except? is higher
Suspend all action to enforce any judgment, attachment
or any provisional remedies against the debtor Statement 1: The liquidation order shall not affect the
Suspend all criminal action against the debtor even right of a secured creditor to enforce his lien in
those under the jurisdiction of the Supreme Court. accordance with the applicable contract or law. TRUE
Suspend all actions or proceedings in court for the Statement 2: The assets of the insolvent debtor shall be
enforcement of claims against the debtor divided among the creditors in accordance with the
Prohibit the debtor from selling, encumbering, Liquidation Plan submitted by the Liquidator and
transferring or disposing in any manner any of its approved by the Court. FALSE? Disposed and the
properties, except in the ordinary course of business proceeds are divided among the creditors
True; False

The following are factors in rehabilitation or liquidation, What is the purpose of FRIA of 2010?
except? To encourage debtors, both juridical and natural
Recognize Creditors Right persons, and their creditors to collectively and
Ensure equitable treatment of creditors who are not realistically resolve and adjust competing claims and
similarly situated property rights.
Respect priority claims
Ensure or maintain certainty and predictability in In accordance with concurrence and preference of
commercial affairs credit, this is a creditor whose claim against the debtor
has asset pledged or attached to it and the fair value of
The following are effects of Liquidation Order, except: the former is greater than the fair value of the latter?
Declaring the debtor insolvent Partially secured creditor
In case of natural person, declaring it as dissolved - it
should be juridical person Statement 1: In accordance with concurrence and
Prohibiting payments and or transfer of property by the preference of credit, fully secured creditors are those
debtor whose claim against the debtor has asset pledged or
attached to it and the fair value of the former is greater
Directing all claims to be filed with Liquidator than the fair value of the latter.
Which of the following is correct? Statement 2: In accordance with concurrence and
Insolvent Juridical persons may file petition for preference of credit, the partially secured creditors are
rehabilitation, suspension of payment and liquidation those creditor who is claiming for payment of his salaries
Insolvent Juridical persons may file petition for and wages.
rehabilitation, suspension of payment but not liquidation False; False
Insolvent Juridical persons may file petition for
Liquidation and suspension of but not rehabilitation The pre negotiated rehabilitation plan shall be approved
Insolvent Juridical persons may file petition for by?
rehabilitation and liquidation but not suspension of 2/3 of the total liabilities more than 50% is secured and
payment more than 50% is unsecured
The involuntary liquidation of a juridical debtor as This is Directly or indirectly imposing unfairly low
opposed to individual debtor? purchase prices for the goods or services of, among
the minimum amount of debt is 1,000,000 others, marginalized agricultural producers, fisherfolk,
micro, small, and medium enterprises (MSMEs), and
The out of court rehabilitation must be approved by the other marginalized service providers and producers?
following, except? Monopsony
85 % of the Total Liabilities that are secured but not
unsecured This is setting prices or other terms and conditions that
85% of the Total Liabilities whether secured or discriminate unreasonably between customers or sellers
unsecured of the same goods or services
creditors with 67% of the secured obligations Discriminatory behavior
75% of the Unsecured obligation
The Philippine Competition Commission has powers,
The following are excluded in the coverage of FRIA, among others, except:
except? Conduct inquiry, investigate, hear and decide cases
Publicly listed companies Deputize enforcement agencies
Insurance To arrest persons violating R.A. 10667
Local Government Unit Conduct administrative proceedings, impose sanctions,
Bank fines or penalties for violation of R.A. 10667 and punish
for contempt
Republic Act 10142 of 2010 is? Issue subpoenas
Financial Rehabilitation and Insolvency Act
The suspension of payment as opposed to
The voluntary liquidation of individual debtor as opposed rehabilitation?
to suspension of payment? the asset of the debtor is greater than the liabilities
500,000 is the minimum amount of debt
The voluntary liquidation of an individual debtor as
Statement1: Seller and consumer may not stipulate the opposed to involuntary liquidation is?
period within which the express warranty shall be the liquidation order shall be both issued after trial
enforceable because it is the law that dictates it.
Staement2: R.A. 10642, The Philippine Lemon Law, The stay order or suspension order shall result to the
applies to all brand new motor vehicles purchased in the following, except?
Philippines and abroad as long as the said vehicles are Allows the debtor from making any payment of liabilities
brought to the Philippines after the purchased outstanding as of commencement date except as may
Both statements are incorrect be provided herein
Suspend all action to enforce any judgment, attachment
The state shall regulate or prohibit monopolies when the or any provisional remedies against the debtor
public interest so requires and that no combinations in Suspend all actions or proceedings in court for the
restraint of trade xxx shall be allowed. enforcement of claims against the debtor
R.A. 10667, The Philippine Competition Act Prohibit the debtor from selling, encumbering,
transferring or disposing in any manner any of its
The following are allowed proceedings for individual properties, except in the ordinary course of business
debtors except?
Rehabilitation This is the instance when A number of producers agree
Involuntary liquidation to restrict their sales to certain geographic areas.
Suspension of payment Market sharing
Voluntary liquidation
Which of the following statements is not correct:
One of the aims of this law is to provide for equal The Philippine Competition Commission is an agency
opportunities to all, promote entrepreneurial spirit, attached to the Office of the President of the Philippines
encourage private investments, facilitate technology The Philippine Competition Commission is a body
development and transfer and enhance resource composed of a Chairperson and three (3)
productivity. Commissioners
R.A. 10667, The Philippine Competition Act The term of office of the Chairperson and the
Commissioners shall be seven (7) years without
This is the instance when competitors collude with one reappointment
another to fix prices for goods or services, rather than There must be one (1) lawyer and one (1) economist as
allow prices to be determined by market forces. members of the Philippine Competition Commission
Price fixing
Statement 1: The repair under the Philippine Lemon Law the asset of the debtor is less than the liabilities
does not include replacement of parts components, or
assemblies. This Anti-competitive agreement entered into by and
Statment2: The Notice of Availment of Lemon Law between two (2) or more entities at different levels of
Rights by the buyer to the seller could be either verbal or distribution or production chains such as those entered
in writing into by suppliers, manufacturers, distributors, and
Both statements are incorrect retailers?
Vertical agreement
These are agreements between competitors (horizontal
agreements) or between and among enterprises in a Statment1: Under R.A. 10909, The No Shortchanging
production or distribution chain (vertical agreements) Act, business establishments are not allowed to or are
that prevent, distort, or restrict competition in a territory? restricted from giving an amount greater than the
Anti-competitive agreements sufficient change.
Statement 2: Under R.A. 10909, The No Shortchanging
Any action arising from a violation of any provision of Act, any business establishment which sells goods or
R.A. 10667, The Philippine Competition Act, shall be provides services are allowed to ask the consumers for
forever barred unless commenced within ______ years. permission to be exempted from the provisions of this
Five (5) Act for the reason of non-availability of small bills or
coins.
How many creditors is/are required to file a petition for Both statements are incorrect
involuntary liquidation of an insolvent juridical debtor?
Three This refers to a position of economic strength that an
entity or entities hold which makes it capable of
This shall refer to the restoration of the debtors to a controlling the relevant market independently from any
condition of successful operation and solvency, if it is or a combination of the following: competitors,
shown that its continuance of operation is economically customers, suppliers, or consumers
Rehabilitation Dominant position

Section 36. Nolo Contendere. – An entity charged in a S1: A manufactured food product that has passed its
criminal proceeding under R.A. 10667, The Philippine expiry date could be regarded as an adulterated food.
Competition Act, may enter a plea wherein he does not S2: Implied warranties refer to all written warranties or
accept nor deny responsibility for the charges but agrees guarantees issued by a manufacturer, producer, or
to accept punishment as if he had pleaded guilty. This importer shall be operative from the moment of sale
plea is known as: True, False
Plea of Nolo Contendere
Statement 1: The term debtor under R.A. 10142, The
Statement 1: The issuance of the Commencement Order Financial Rehabilitation and Insolvency Act (FRIA) of
and the Suspension or Stay Order shall not suspend the 2010, includes banks, insurance companies, pre-need
claim of a secured debtor. companies, and national and local government agencies
Statement 2: Under R.A. 10642, The Philippine Lemon or units.
Law, you may return the brand new motor vehicle Statement 2: A person not contended with the actions of
purchased even after twelve (12) months from the said the rehabilitation receiver may sue him in courts other
purchase as long as the mileage does not exceed than the one where the petition for rehabilitation is
20,000 kilometers pending.
Only statement 2 is true Both statements are incorrect

To penalize all forms of xxx abuse of dominant position The following acts are considered abuse of dominant
xxx with the objective of protecting consumer welfare position, except:
and advancing domestic and international trade and Making a transaction subject to acceptance by other
economic development. party of other obligations which have no connection with
R.A. 10667, The Philippine Competition Act the transaction
Setting prices xxx that discriminate unreasonably
Before a merger and/or acquisition (of/by between customers or sellers of the same goods or
companies/entities) involving more than one billion services
pesos to be implemented, the parties need to the Imposing barriers to entry or committing acts that
Philippine Competition Commission of the same for prevent competitors from growing
____. Changing the price in response to changing market
Thirty (30) days conditions, marketability of goods or services, or volume
Selling goods or services below cost to drive competition
The rehabilitation as opposed to suspension of out of the relevant market
payment?
Which of the following is true regarding competition?
When a market is competitive, businesses will have The out of court rehabilitation must be approved by the
greater incentives to lower prices, to improve the quality following?
of their products and services, and to provide buyers Those creditors with 67% of the secured obligations
with more options. Those creditors with 67% unsecured obligation, 75% of
It will create hatred and fear the secured obligation and 85% of the Total Liabilities
Competition in the marketplace means having a market whether secured or unsecured
where there are limited businesses offering products and Those creditors with 67% secured obligation, 75% of the
services that are similar. unsecured obligation and 85% of the Total Liabilities
Markets with enough competition does not benefit the whether secured or unsecured
poor directly. Those creditors with 67% secured obligation, 75% of the
unsecured obligation and 85% of the Total Liabilities
To Prevent economic concentration which will control the which are secured but not unsecured
production, distribution, trade, or industry that will unduly
stifle competition, lessen, manipulate or constrict the Which of the following is correct in an involuntary
discipline of free markets. liquidation?
R.A. 10667, The Philippine Competition Act
Three (3) or more creditors the aggregate of whose
Which of the following is incorrect? claims is at least either One million pesos
Discriminatory behavior is applying dissimilar pricing or (Php1,000,000,00) or at least twenty-five percent (25%)
conditions to equivalent transactions of the subscribed capital stock or partner’s contributions
Anti-competitive mergers and acquisition refers to of the debtor, whichever is higher, - eto lang kasi yung
merger or acquisition transactions that lead to a abt involuntary HAHHA
substantial lessening of competition, or significantly At any time during the pendency of court-supervised or
impede effective competition in the relevant market. pre-negotiated rehabilitation proceedings, the debtor
Predatory pricing provides that the dominant player may also initiate liquidation proceedings by filing a
deliberately incurs losses in the short run by setting motion in the same court where the rehabilitation
prices so low that it forces one or more undertakings out proceedings are pending to convert the rehabilitation
of the market, so as to be able to charge higher proceedings into liquidation proceedings. - voluntary to
Discriminatory behavior is applying similar pricing or An individual debtor whose properties are not sufficient
conditions to equivalent transactions to cover his liabilities, and owing debts exceeding Five
hundred thousand pesos (Php500,000.00), may apply to
Statement 1: The financial rehabilitation and insolvency be discharged from his debts and liabilities by filing a
act covers insolvent individual debtors but not insolvent verified petition with the court of the province or city in
juridical person. which he has resided for three (3) months prior to the
Statement 2: The suspension of payment is applicable to filing of such petition. - voluntary din
insolvent juridical debtor but not to insolvent individual An insolvent debtor may apply for liquidation by filing a
debtor. petition for liquidation with the court. - voluntary
False; False
How many creditors is/are required to file a petition for
Insolvent shall refer to the financial condition of a debtor rehabilitation of an insolvent individual debtor?
that is? None
I. Generally able to pay its or his liabilities as they
fall due in the ordinary course of business Which of the following is true?
II. Has liabilities that are greater than its or his The rehabilitation plan can be filed voluntarily but not
assets involuntarily
III. Has liabilities that are less than its or his assets The pre-negotiated rehabilitation requires approval of 2/3
II only of total creditors more than 50% of which is secured and
more than 50% of which is unsecured.
Statement 1: The Liquidation Order shall not affect the The pre-negotiated rehabilitation requires approval of
right of a secured creditor to enforce his lien in majority of total creditors more than 50% of which is
accordance with the applicable contract or law, unless secured and more than 50% of which is unsecured.
he waives his right. In liquidation, do not ensure or maintain certainty and
Statement 2: When the value of the property is less than predictability in commercial affairs
the claim it secures, the liquidator may convey the
property to the secured creditor and the latter will be Statement 1: Cram Down Rule indicates that the
admitted in the liquidation proceedings as an unsecured Rehabilitation plan confirmed by the Court shall be
creditor for the balance. binding upon the debtor and all persons who may be
True; True affected by it, including creditors whether or not such
False; False persons have participated in the proceedings, opposed
False; True
the plan or whether or not their claims have been informal restructuring/workout agreement or
scheduled. Rehabilitation Plan?
Statement 2: The stand-still period shall not exceed 90 Stand still period of 120 days
days from the application of verified petition of
rehabilitation Who will file the petition for voluntary rehabilitation?
True; False the juridical debtor who is insolvent

Statement 1: The court shall dismiss the petition for How much is the minimum amount of debt for the court
Rehabilitation when the debtor is found to be insolvent. to grant involuntary liquidation of an insolvent
Statement 2: The court shall deny the petition for partnership?
rehabilitation when there is a mere sham filing on the 1,000,000 or 25% of subscribed capital stock whichever
part of the creditor. is higher
False; False
Which of the following is true?
The three modes in rehabilitation are the following, The liquidation order shall affect the right of a secured
except? debtor to enforce his lien in accordance with the
Court Supervised applicable contract or law.
Suspension of Payment Rehabilitation The liquidation order shall not affect the right of a
Out of Court Rehabilitation secured debtor to enforce his lien in accordance with the
Pre-negotiated Rehabilitation applicable contract or law.
The liquidation order shall affect the right of a secured
Statement 1: Rehabiliatation shall refer to the restoration creditor to enforce his lien in accordance with the
of the debtors to a condition of successful operation and applicable contract or law.
solvency, if it is shown that its continuance of operation The liquidation order shall not affect the right of a
is economically feasible. secured creditor to enforce his lien in accordance with
Statement 2: Voluntary liquidation of insolvent the applicable contract or law.
corporation is when the creditor files a verified petition
with the Municipal Trial Court. Statement 1: The Liquidation Order shall result to
True; False declaration of the debtor as insolvent. Statement 2: The
liquidation order shall result to prohibiting of payments
What should be the decision of the court if the juridical and or transfer of property by the debtor.
person is found to be insolvent and that there is no True; True
substantial likelihood of rehabilitation?
Convert petition for rehabilitation to liquidation Statement 1: The cram down rule applies to court
supervised rehabilitation and pre-negotiated
Statement 1: Insolvent Juridical persons may file petition rehabilitation but not out of court rehabilitation
for rehabilitation and liquidation but not suspension of Statement 2: In liquidation of individual debtor, the
payment. liquidation order shall be issued even without trial in
Statement 2: Insolvent Individual Debtor may file petition case of voluntary liquidation
for suspension of payment and liquidation but not False; True
rehabilitation
True; True Statement 1: The proceedings involved under FRIA are
considered as in persona, which means that it binds the
What will be the action of the court if the debtor is found whole world.
not to be insolvent and that there is act to defraud the
creditor? Statement 2: Under FRIA, debtor covers individual
Dismiss debtor, a sole proprietorship, partnership and
corporation but excludes Bank, insurance companies,
All are correct, except? Pre-need and National or Local Government Unit or
Rehabilitation is allowed if the insolvent person is an Agency
juridical debtor False; True
Suspension of payment is allowed if the insolvent person
is an juridical debtor How many creditors is/are required to file a petition for
Involuntary liquidation is allowed if the insolvent person suspension of payment of an insolvent individual debtor?
is an individual debtor None
The Voluntary liquidation is allowed if the insolvent
person is an individual debtor How many creditors is/are required to file a petition for
involuntary liquidation of an insolvent individual debtor?
This period that may be agreed upon by the parties One
pending negotiation and finalization of the out-of-court or
The voluntary proceedings may be initiated by an
insolvent debtor through filing a petition for rehabilitation The voluntary liquidation of an individual debtor as
with the court and on the grounds provided under the opposed to involuntary liquidation is?
FRIA, which of the following is true? the debtor files in the former while creditor files in the
The filing of the petition for rehabilitation must be latter
approved by 2/3 vote of the partners in partnership
The filing of the petition for rehabilitation must be Which of the following is correct?
approved by majority vote of the Board of Directors or In voluntary liquidation proceedings of both juridical and
Trustees and 2/3 vote of the subscribed capital stocks in individual debtors, jurisdiction over all persons affected
a corporation by the proceedings is acquired upon publication of the
The filing of the petition for rehabilitation must be Liquidation Order as provided in these Rules.
approved by majority vote of the Board of Directors or The assets of the insolvent debtor shall be divided
Trustees and 2/3 vote of the outstanding capital stocks among the creditor in accordance with the Liquidation
in a corporation Plan submitted by the Liquidator even without approval
The filing of the petition for rehabilitation must be of the Court
approved by the manager in case of a partnership. In voluntary liquidation proceedings of individual debtors,
jurisdiction over the person of the debtor is acquired
Statement 1: In accordance with concurrence and upon service of summons
preference of credit, fully secured creditors are those The assets of the insolvent creditor shall be divided
whose claim against the debtor has asset pledged or among the debtors in accordance with the Liquidation
attached to it and the fair value of the former is greater Plan submitted by the Liquidator and approved by the
than the fair value of the latter. Court.
Statement 2: In accordance with concurrence and
preference of credit, the partially secured creditors are In case of voluntary Liquidation of Business
those creditor who is claiming for payment of his salaries Organization, which of the following is correct?
and wages. Creditor whose claim is at least either Five Hundred
False; False Pesos (Php500,000) or at least twenty-five percent
(25%) of the subscribed capital stock or partner’s
Statement 1: Corporations that are financially related to contributions of the debtor, whichever is higher, may
one another are considered as group of creditors. apply for liquidation.
Statement 2: Partnerships that are owned more than Three (3) or more creditors the aggregate of whose
50% by the same person are group of debtors. claims is at least either One million pesos
False; True (Php1,000,000) or at least twenty-five percent (25%) of
the subscribed capital stock or partner’s contributions of
What is the appropriate penalty imposed on the the debtor, whichever is higher, may apply for
individual debtor, owner of a sole proprietorship, the liquidation.
partners in a partnership, or the directors and officers of The debtor files for the petition for liquidation contending
a corporate debtor after notice of commencement of that total asset is not sufficient to pay the total liability
proceeding, willfully conceal, authorize or approve the Creditor whose claim is at least either One million pesos
concealment from the creditors, or embezzle or (Php1,000,000) or at least twenty-five percent (25%) of
misappropriate, any property of the debtor? the subscribed capital stock or partner’s contributions of
Liable for double the value of the property sold, the debtor, whichever is higher, may apply for
embezzled or disposed of, or double the amount of the liquidation.
transaction involved, whichever is higher

The stay order or suspension order shall result to the

following, except?
Suspend all actions or proceedings in court for the
enforcement of claims against the debtor
Prohibit the debtor from selling, encumbering,
transferring or disposing in any manner any of its
properties, even during the ordinary course of business -
eto ata dapat kasi except during the ordinary ata / same
ans
Prohibits the debtor from making any payment of
liabilities outstanding as of commencement date except
as may be provided herein
Suspend all action to enforce any judgment, attachment
or any provisional remedies against the debtor