Philippine Regulator To Slash Fees For Online Operators

January 22, 2024
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The head of Philippine gambling regulator PAGCOR has promised a series of material cuts to offshore-facing online operator (POGO) fees by 2025, as it pushes back against growing hostility to the online industry.
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The head of Philippine gambling regulator PAGCOR has promised a series of material cuts to offshore-facing online operator (POGO) fees by 2025, as it pushes back against growing hostility to the online industry.

PAGCOR chairman and CEO Alejandro Tengco last week told local media that the government share of online casino revenue could fall as low as 30 percent as part of measures to strengthen POGO licensee defences against underground activity.

Recent cuts mean the government’s share of POGO revenue is “now at 42.5 percent, and I’m going to bring it to 37.5 percent by March [2024]”, the Philippine Daily Inquirer quoted Tengco as saying in a Monday (January 22) report.

Tengco said the goal of the cuts is to make licensed operations more competitive after years of damage from the coronavirus pandemic, Chinese government pressure and tougher scrutiny and enforcement in the Philippines.

“I just want to kill illegal gaming,” he said. “These [illegal operators] proliferated because PAGCOR charged [its licensees] so much.”

The comments follow a statement by Tengco to reporters on January 15 in which he welcomed applications from new POGO operators, now known as Internet Gaming Licensees (IGLs) because of the stigma that the “POGO” acronym carries.

POGO licensees have been under sustained attack by senators amid multiple probes into the industry, while key government agencies have joined public calls for the regulated industry to be eradicated.

The latest scandal is a renewed outbreak of alleged corruption in the Bureau of Immigration, whose officers were accused by justice minister Jesus Crispin Remulla last week of issuing thousands of work visas attached to more than 500 fake companies, many of which were likely covering for POGO or underground gambling operations.

Amid Remulla’s demand that immigration bureau documents be secured for a justice probe, immigration commissioner Norman Tansingco responded on Thursday by announcing the abolition of the Visa Task Force, and that four of its lawyers had received “show cause orders” in November before being relieved of their duties.

With public and official confidence in the online gambling industry cratering after years of scandals involving murder, kidnapping, enslavement and other violence, corruption of government institutions, tax and compliance controversies, and chronic illegal immigration involving Chinese nationals, Tengco continues to play the economics card in defence of the sector.

“It’s not easy to [shutter] the industry,” he said. “There are close to 70,000 Filipinos working in the POGO sector. Where will you put them?

“There are also 625,000 square metres [of office space] occupied by” POGOs and service providers, he said, along with associated revenue for other commercial segments.

Tengco told the Inquirer that his reduction of government revenue share to 42.5 percent has stemmed the closure of POGO licensees from six per month to one every two months.

“In short, they’re encouraged to compete,” he said.

Meanwhile, Tengco appears to have expedited PAGCOR’s plan to launch its own Casino Filipino-branded online gambling website, an initiative targeting local and overseas customers ahead of the proposed privatisation of PAGCOR’s commercial operations. The local and foreign market combination is currently prohibited by PAGCOR.

Tengco told the Manila Bulletin daily on Wednesday that the launch could take place as early as the second half of 2024.

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