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BP 22: The Bouncing Checks Law in the Philippines
Batas Pambansa Bilang 22, commonly known as the Bouncing Checks Law, makes it a criminal offense to issue a check that is subsequently dishonored by the bank for insufficiency of funds or credit. The law aims to maintain the integrity and reliability of checks as a form of payment. A conviction under BP 22 can result in a penalty of imprisonment, a fine, or both.
How the Criminal Fine is Calculated
The law prescribes a criminal fine that is not less than the face value of the check, but not more than double that amount. However, there is an absolute maximum cap: the fine cannot exceed Two Hundred Thousand Pesos (₱200,000), regardless of how large the check amount is. Therefore, the calculation follows a simple two-step rule:
- Double the Check Amount: Calculate twice the value of the bounced check.
- Apply the Cap: The criminal fine due is the lesser of (a) the doubled amount, and (b) ₱200,000.
For example, for a check worth ₱50,000, the doubled amount is ₱100,000. Since this is below the ₱200,000 cap, the maximum criminal fine is ₱100,000. For a check worth ₱150,000, the doubled amount would be ₱300,000, but the cap applies, so the maximum fine is ₱200,000. Remember, this fine is payable to the government and is separate from your civil debt to the payee for the check amount.
The Banking-Day Payment Deadline After Notice
A crucial defense against criminal prosecution under BP 22 is to make payment within a specific period after receiving a notice of dishonor. The payee (the person who received the check) must formally notify the drawer (the person who issued the check) that the check was dishonored. From the date of that notice, the drawer has five (5) banking days to pay the amount of the check, as stated in the law. Banking days exclude Saturdays, Sundays, and public holidays declared by the government. If payment is made within this period, it may constitute a valid defense to stop the filing of a criminal case. The exact number of days may be reiterated in the notice itself.
Frequently Asked Questions
What if I pay after the deadline? Paying after the deadline may still be beneficial in settling the civil liability (the debt), but it may not prevent the filing of a criminal case. The payee may still proceed with the BP 22 complaint.
Does the criminal fine replace the debt? No. The penalty under BP 22 is a criminal fine payable to the government. The drawer still owes the payee the face value of the check as a civil debt.
Next Steps: Sending a Formal Notice
If you are the payee of a bounced check, your first formal step is to send a Notice of Dishonor to the drawer. This document clearly states the check details, the fact of dishonor, and demands payment within the legal timeframe. It serves as the official trigger for the payment deadline and is essential for any subsequent legal action.