Atty. Noe B. Baga

December 23, 2003 SEC OPINION NO. 71-03 Atty. Noe B. Baga Raga & Associates Law Offices Suite 1704, Herrera Tower, 98 Herrera corner. Valero, Salcedo Village, Makati City, Philippines S i r : This refers to your two letters-query, both dated December 8, 2003 inquiring on whether or not the sale of creams and skin care products of your clients, Biolite, Inc. and Dermawell International, Inc. which they use as an essential part of their face and body rejuvenation treatment would fall under the classification of "retail sale." EcAISC Under Section 3(1) of RA 8762, the term "retail trade" is defined as follows: "Retail trade shall mean any act, occupation or calling of habitually selling direct to the general public merchandise, commodities or goods for consumption." Under Section 2 (e) of the Implementing Rules of RA 8762, a sale is not considered as retail if it is a "(e) Sale to industrial and commercial users or consumers who use the products bought by them to render service to the general public and/or manufacture of goods which are in turn sold by them." Considering that the sale of said creams and skincare products is inseparable from the slimming treatment provided by the company and will not be sold except to those persons who have enrolled for slimming treatment, the said sale is not considered retail. In such situation, your clients "Biolite, Inc." and "Dermawell International, Inc." would be consuming said creams and skincare products to render a slimming treatment service to the general public, thus falling within the exception provided under the Implementing Rules of RA 8762. Very truly yours, (SGD.) VERNETTE G. UMALI-PACO General Counsel