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Philippine Regulator Resists Calls For Online Gambling Ban

September 29, 2022
Philippine gambling regulator PAGCOR has defended its record supervising the offshore-facing online segment amid mounting support for legislation that would ban the industry in its entirety.

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Philippine gambling regulator PAGCOR has defended its record supervising the offshore-facing online segment amid mounting support for legislation that would ban the industry in its entirety.

PAGCOR said in a statement late on Wednesday (September 28) that the recent, high-profile shuttering of several illegal operators and the mass arrest of mostly Chinese employees “are not in any way related to legitimate Philippine Offshore Gaming Operations (POGOs)”.

“The agency emphasises that any individual, group or entity which conducts online gambling without approval to operate from PAGCOR should not be categorised as POGO,” it said.

The statement appeared to respond to a potentially damaging Reuters report that the Philippines is preparing to shut down “175 offshore gambling firms and deport about 40,000 workers”.

The report cited justice ministry spokesman Jose Dominic Clavano, who appeared to label all offshore-facing gaming operations as POGOs, including illegal operations.

Reuters noted near the end of its report that only some 30 POGO licensees remain in the Philippines after pandemic disruption.

But Reuters did not distinguish between PAGCOR’s 34 licensed operations, a much larger number (132) of licensed service providers to POGOs, nor illegal operations — some or all of which Clavano apparently described as “POGOs targeted for closure” over expired or revoked licences, or tax delinquency.

Philippine media and even gaming industry media went on to publish or quote Reuters’ September 26 report without commenting on the confusion.

PAGCOR’s own data indicates that, as of September 20 this year, 40 POGOs have had their licences cancelled, with cancellations also applying to two “special class” service providers and another 172 ordinary service providers.

But this cancellation data is cumulative and the regulator has not released its own numbers on how many former licensees have broken the law or exited the market for commercial reasons, or when.

In Wednesday’s statement, PAGCOR chairman and CEO Alejandro Tengco said his agency “strictly” monitors POGO licensees.

Any “gaming entity that fails to pass the application process for an offshore gaming licence and to fulfil the documentary and financial requirements, among others, cannot be labelled as legal offshore gaming operators, or POGO”, the statement said.

He said PAGCOR has been working closely with law enforcement and other government departments to identify “any illegal offshore gaming operations in the country and thwart kidnapping and human trafficking incidents”.

The justice ministry’s purported claim that an estimated 40,000, mostly Chinese, employees of illegal operations are set to be deported also contradicts recent misgivings expressed by the ministry’s top official.

Justice secretary Jesus Crispin Remulla last week announced that 281 Chinese nationals would be deported in early October after being caught working for illegal operators.

But he also warned that the immediate deportation of 40,000 illegal workers would overwhelm processing and detention capacity and potentially trigger a “humanitarian crisis”.

A bill submitted recently to Congress with the support of senior lawmakers threatens to ban the online gambling industry entirely, including nascent domestic operations. If passed, the bill would demand a massive and unprecedented repatriation process of legal and illegal staff.

Some lawmakers have publicly resisted the surge in calls for prohibition, with senators Sherwin Gatchalian and Juan Edgardo Angara on Tuesday warning of dangerous ripple effects for the national coffers and a real estate industry that thrives on POGO and service provider leases.

Also on Tuesday, House of Representatives Ways and Means Committee chairman Joey Salceda warned that the end of regulation and a blanket ban would strip the gaming industry of some 90,000 jobs, exacerbating social problems and driving operations underground.

A better solution involves "very strong regulatory powers” and tight-knit communications between PAGCOR and law enforcement agencies, Salceda said.

“There should be a systematic approach, a physical way of addressing the problem with the combined action of the NBI [National Bureau of Investigation], PNP [Philippine National Police] and BID [Bureau of Immigration and Deportation].”

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