Philippine online gaming industry still unsure where it stands


philippine-online-gaming-confusionOnline gambling technology provider PhilWeb’s hopes of acquiring a new gaming license in the Philippines have hit a major snag.

On Tuesday, PhilWeb filed papers with the Philippine stock exchange revealing that the Philippine Amusement and Gaming Corporation (PAGCOR) had informed PhilWeb that the company will have to compete for the right to provide gambling technology at PAGCOR-licensed eGames cafes.

Until this summer, PhilWeb supplied technology to hundreds of eGames cafes, which offer internet-connected terminals providing online casino products for local residents. Then newly elected Philippine President Rodrigo Duterte declared “online gambling must stop,” leading to PAGCOR declining to renew PhilWeb’s gaming license.

PhilWeb went into a death spiral that was only halted when chairman Roberto Ongpin agreed to sell his entire stake in the company, leading to hopes that PhilWeb would have its license renewed under different management.

But in a letter dated December 12, PAGCOR chair Andrea Domingo informed PhilWeb that a simple license renewal was “no longer legally feasible.” Domingo said PAGCOR planned to award the eGames technology contract through a public auction, in keeping with the terms of the Government Procurement Reform Act. PAGCOR corporate spokesperson Carmelita Valdez told Business World that the regulator was currently preparing the public tender’s terms of reference.

Meanwhile, Philippine Justice Secretary Vitaliano Aguirre II has clarified that fugitive gaming operator Jack Lam’s unauthorized online gambling operations are still forbidden to reopen. Lam fled the Philippines a month ago after 1,316 Chinese nationals were arrested for working illegally at the online operations run out of Lam’s Fontana Casino in Clark Freeport.

Following Lam’s skedaddle, Philippine law enforcement ordered the closure of the Fontana as well Lam’s Fort Ilocandia Casino in Laoag City. Late last week, the Fontana closure order was lifted but Aguirre has now clarified that the order doesn’t apply to Lam’s online operations, which were never licensed by any Philippine authority.

Duterte recently announced a renewed offensive against online gambling operators, although PAGCOR has since clarified that recipients of the new Philippine Offshore Gaming Operator (POGO) licenses aren’t targets of the new crackdown.

The crackdown is focused on operators who held licenses issued by the Cagayan Economic Zone Authority (CEZA) and other special economic zones in Aurora and Bataan provinces. On Monday, CEZA administrator Jose Mari Ponce issued a statement saying CEZA was “open to the investigation of its online gaming support services operations” in order to “clear up issues” surrounding its licensing process.

Bataan Gov. Abet Garcia struck a slightly more defiant tone in defending the right of the Authority of Freeport Area of Bataan (AFAB) to regulate online gambling. Garcia said the Republic Act 9728 allowed AFAB to “operate online gaming, gambling casinos, etc.” subject to PAGCOR’s approval and supervision, which “must not be unreasonably withheld.”

AFAB chairman Emmanuel Pineda said the crackdown on Lam’s online operations had led to rumors of similar raids targeting AFAB, which caused “tension, fears, anxiety and uncertainty” for the online operations of AFAB’s master licensor Grand Innovasia Concept Corp (GICC).