Rules eyed amid barter revival
Barter is the world’s oldest form of trade
As commerce evolves into the virtual world, barter is experiencing a huge revival.
The Department of Trade and Industry (DTI) on Wednesday said it will study if new rules will be needed on online barter trade, particularly those done outside of currently allowed areas as such activities gain fresh popularity amid quarantine restrictions due to COVID-19.
This comes as the department clarifies that barter trade is currently only limited to three areas in Mindanao, rendering the activity prohibited if done as a form of business outside of those areas of online and cross-border.
Still, in a statement, DTI secretary Ramon Lopez also said personal barter transactions that are not in the course of trade and business are allowed and aren’t covered by registration requirements.
“Barter is the world’s oldest form of trade and is regulated under Executive Order 64 signed by president Rodrigo Roa Duterte in 2018. The EO also established the Mindanao Barter Council, tasked to supervise and coordinate barter activities in the Philippines,” the statement read.
“This EO stresses that barter trade is only allowed in three areas, namely in Siasi and Jolo in Sulu and Bongao in Tawi-Tawi. Outside those areas, barter trading across borders is not allowed.”
Traditional in new normal
On barter transactions in the online space, Lopez told reporters that the department “will study” new rules “if still needed.”
The barter system allows people to directly exchange goods or services without using money, with the items to be swapped usually deemed of equal value by the involved parties.
The government in 2018 released EO 64 in a bid to foster the growth of barter trade in the Mindanao areas and boost rural and value chain development by creating jobs and business opportunities.
The order also seeks to strengthen ties among member-states of the Brunei Darussalam-Indonesia-Malaysia-Philippines East ASEAN Growth Area, which has a long history of trade and commerce including barter trade as commercial practice.
Registration a must
For barter trade in the areas allowed, the DTI said while there is no clear prohibition, it still requires regulation and must be registered.
“The DTI emphasizes that this is subject to tax if it is being done in the course of regular trade or business. This is also applicable for online transactions. However, local barter trade activities with less than P3 million gross sales per year may avail of value added tax exemption,” Lopez said further in his statement.