Pagcor shuts down 200 POGO firms

by Mary Grace Padin, Paolo Romero (The Philippine Star) – 9 Oct 2019

MANILA, Philippines — Authorities have so far shut down around 200 Philippine offshore gaming operators (POGOs) that have been operating without license, the Philippine Amusement and Gaming Corp. (Pagcor) said yesterday.

Pagcor chairman and chief executive officer Andrea Domingo said the agency, in cooperation with the National Bureau of Investigation (NBI) and Philippine National Police (PNP), has successfully raided fly-by-night online gaming operations in the country.

“The last count, the report, and that was a few months ago, they’ve already closed 170 small operations. These are small fly-by-night operations,” Domingo said at a forum yesterday.

“But now I think they should be reaching 200 because we get an average of about 10 certifications from NBI and PNP on who they suspect to be illegal – certification that they ask us if they are registered with us. If they’re not registered with us then that means they will raid and close them down,” she added.

Earlier, Pagcor entered into a mutual cooperation agreement with the NBI, PNP, Bureau of Immigration and the Department of Justice for a concerted effort against illegal online gambling.

Various agencies have also joined forces and formed the POGO task force to strengthen the crackdown on POGOs and their foreign employees not paying the appropriate taxes.

There are currently 60 POGO firms licensed by Pagcor. However, the regulator earlier imposed a moratorium on new licenses until such time that issues plaguing the industry are addressed.

Domingo said the moratorium also came at a time when online gaming was banned in Cambodia, preventing the Philippines from becoming the catch basin for fleeing operators.

“As courtesy and respect for the Chinese government closing down online gaming in Cambodia, remember we said we will not accept any more applications for online gaming. We do not want to be the basin for the fallout in Cambodia,” the Pagcor chief said.

However, she said some operators in the country may benefit from the ban in Cambodia by attracting more customers.

“The operators might benefit from it in terms of having more players, but we’re not sure of that, we have not seen a real big spike in the GGR (gross gaming revenue),” she said.

According to Domingo, the POGO industry is contributing P20 billion a year on lease payments to the real estate sector.

She said the industry is also estimated to generate P24 billion in income taxes annually and P1.25 billion in value-added tax monthly from foreign workers who purchase around P12.5 billion a month.

House mulls bill on POGO taxation

Such developments have prompted the House of Representatives to consider passing a bill that seeks to prescribe a taxation scheme for POGOs.

The committee on ways and means is now drafting the proposal following the closure by the Bureau of Internal Revenue of some POGOs allegedly to failure to pay taxes.

Albay Rep. Joey Salceda, committee chairman, said his panel is proposing a franchise tax of five percent based on an operator’s gross revenues.

“It will be a tax on gaming monopoly and on gambling. POGOs shall be registered as resident corporations as basis for their taxability,” he said. – With Jess Diaz