PAGCOR Collects Licensing Fees, but the Philippines Cannot Play

Published December 13, 2016 by Lee R

PAGCOR Collects Licensing Fees, but the Philippines Cannot Play

The contradiction between prohibiting national play and collecting licensing fees for offshore-facing operators is being contested in the Philippines Supreme Court.

Does it sound odd that the Philippines regulatory body is issuing licenses to operators, while their own citizens are forbidden from playing?

Legally Opposing PAGCOR

Well, it does to a Philippines civil liberties group. The NGO Union for National Development and Good Governance-Philippines (UNLAD-Philippines) claims that the Philippine Amusement and Gaming Corporation PAGCOR is expanding and abusing its power without Congressional approval.

Supreme Court Challenge

UNLAD formally challenged PAGCOR’s issuance of license to Philippine operators who would not be serving Pilipino players in a Supreme Court lawsuit filed last month, claiming on November 7th that PAGCOR did not have the Constitutional right to issue offshore gaming licenses.

Basis for Contest

UNLAD cited Presidential Decree 1869 Rules on Offshore Gambling in refuting PAGCOR’s authority to regulate or operate online gambling catering to foreign players living outside the Philippines.

PAGCOR’s Rise to Power

After ascending to regulatory power in September following a government crackdown on iGaming provided to Philippine citizens, PAGCOR immediately raised eyebrows by offering five figure licenses to offshore-facing gaming operators. The measure was designed to replace the revenue lost when the incoming Duterte Administration shut down 286 e-gaming parlours belonging to PhilWeb Corp, whose e-gaming license PAGCOR refused to renew in the crackdown.

Fee Levels

The new PAGCOR license application fees are $40,000 for an online sports betting license and $50,000 for an online casino license, with accepted applications costing operators in the Philippines an additional $200,000 for online casino and $150,000 for online sports betting operations.

PAGCOR’s Response

PAGCOR asserts the value of the legal right to oversee licensing of offshore-facing companies in the Philippines as a way to collect revenues that benefit the country, pointing out that the new initiative has already generated $18.7 million in licensing and application processing fees, with 72% is earmarked for social development. 

Too Much Power

Another conflict of interest arises from the fact that PAGCOR is currently serving as both regulator and operator, running 11 casinos under the Casino Filipino brand. PAGCOR maintains that it is currently in the process of relinquishing operator duties and will be acting exclusively as an operator before the end of Q3 2017.

As the Regulation Turns

While PAGCOR tries to iron out its legal and ethical issues before being legitimized in the eyes of the public, PAGCOR officials will continue to process eye-popping amounts of money.

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