What Went Before

In mid-August 2016, state-owned Philippine Amusement and Gaming Corp. (Pagcor) did not renew its contract with Philweb Corp. which serviced a network of electronic gaming cafés. The nonrenewal resulted in the closing of 286 e-games sites.

On Aug. 26, 2016

Pagcor issued its Rules and Regulations for Philippine Offshore Gaming Operators (Pogos). The newly created Pogo category aims to help bring previously unregulated online gaming operations under the government’s supervision.

Pagcor said it would venture into the licensing of Pogos “to safeguard the welfare of the Filipinos at the same time meet the agency’s revenue targets to help fund the government’s nation-building programs.”

Offshore gaming is to be conducted via internet using a network and software to be offered exclusively to offshore authorized players who have registered and established online gaming accounts with licensees.

In a press statement issued in September that year, Pagcor had said it would start accepting letters of intent from applicants keen on acquiring offshore gaming licenses.

Pagcor said an offshore gaming license may be granted to a Philippine- or offshore-based operator organized in any foreign country that will engage the services of a Pagcor-accredited service or support provider for its online gaming activity.

Authorized players of these offshore gaming offerings must be foreigners based in another country. Foreign nationals who are staying in the Philippines and Filipinos residing abroad are not allowed to take part in the online gaming activity. Likewise, individuals who are under 21 years old are not allowed to play.

To enforce the provisions, Pagcor initially created an Ad Hoc Licensing Committee or the Task Force Pogo which eventually evolved into the Offshore Gaming Licensing Department (OGLD).

On Feb. 2, 2017

President Duterte signed Executive Order No. 13, series of 2017, otherwise known as “Strengthening the Fight against Illegal Gambling and Clarifying the Jurisdiction and Authority of Concerned Agencies in the Regulation and Licensing of Gambling and Online Gaming Facilities, and for Other Purposes”.

One of the stipulations is on the territorial jurisdiction of gambling regulators such as Pagcor, Cagayan Economic Zone Authority (Ceza), Aurora Pacific Economic Zone and Freeport Authority (Apeco) and Authority of the Freeport Area of Bataan (Afab) in issuing licenses to operate online gambling activities. In effect, it strengthens the regulatory authority of Pagcor, particularly of the OGLD over online gaming operations.

On July 3, 2018

Pagcor issued the Offshore Regulatory Manual (OGRM) which now governs the issuance of offshore gaming license by the OGLD, and the regulation of offshore gaming operations in general, as well as the conduct of offshore gaming operations by the Pogo licensees and service providers.

At present the OGLD receives, processes and evaluates applications for offshore gaming license as well as recommends grant of licenses to operate, for final approval of the Pagcor Board of Directors.

To date, Pagcor has issued licenses to 58 Pogos that employ more than 130,000 individuals, while three are still pending approval.

Pagcor chair Andrea Domingo pointed out that Pogos had contributed P11.9 billion in gaming revenues between 2016 and 2018, up from only P56 million previously.

Despite these accomplishments, there have been controversies surrounding the operations of Pogos in the country.

The influx of thousands of Chinese workers in the country, some of them skirting labor regulations to gain temporary employment in the country, has given rise to several issues.

One concern is that they present a national security risk for the country. Sen. Joel Villanueva, in a Senate hearing last year, also described anecdotal evidence of massive Chinese presence in major real estate developments in Metro Manila, especially in the south.

Demand for offices and housing by the Chinese workers has buoyed the real estate market in Metro Manila. But this good news has a negative impact. It has been pointed out that it pushed rents up in many condominium buildings beyond the reach of most Filipinos.

Other concerns that were raised include the increase in crime involving Pogo players and financiers, racial antagonism between Chinese and Filipinos, the exploitation of Chinese workers, fly-by-night operators, and the nonpayment of taxes in this industry.

Recently, Domingo said the regulator would now “closely review and monitor” existing Pogo contracts to address issues on security and legality of operations. The moratorium would continue until end 2019.

“We will only have a maximum of 61,” she said. “We will no longer, at this time, accept applications until we have reviewed and comfortably addressed all the concerns of everybody, including the concerns of the senators and real estate people. It’s about time, after almost three years of implementing this program, to stop first and look at other concerns until they have been addressed comfortably and effectively.”

On Aug. 19, 2019

In a briefing in Malacañang on this day, presidential spokesperson Salvador Panelo said until President Duterte “reverses” the Pagcor order on the said moratorium, it “remains to be the policy.”

Despite all these, Pagcor revenue from Pogos is seen hitting P8 billion in 2019.

Sources: Inquirer Archives, officialgazette.gov.ph, pagcor.ph