The Philippines’ Secretary of Finance, Ralph Recto, says his department opposes a total ban of online gambling, a service-sector currently permitted to serve domestic consumers.
In a digital message in reply to the BusinessWorld news outlet, published on Thursday but reportedly sent at the end of last month, Mr Recto said his department’s “cost benefit analysis… shows that the industry can have a net benefit impact on the economy if certain negative externalities are controlled through more stringent regulations”.
The media outlet added Mr Recto also indicated he supported the idea of tighter controls on what it termed “electronic” gaming.
In regulatory terms, the Philippines usually makes a distinction between remote gaming, delivered via the Internet from tables or slots within the country’s land-based casinos, and what the regulator the Philippine Amusement and Gaming Corp (Pagcor) refers to as “electronic games”, delivered via other methods.
The Philippines’ electronic games market is composed of e-games, e-bingo, and bingo grantees, according to Pagcor’s definition of the play segment.
“We reiterate that the Department of Finance will follow the policy direction of the president,” said Mr Recto, referring to the nation’s leader, President Ferdinand Marcos Jr. He has pledged to address the topic, since the time some lawmakers began earlier this year calling for a ban, though said he would not act in haste.
The Finance Secretary noted in his own comments: “We will implement the administration’s stance on this issue.”
BusinessWorld cited Mr Recto calling for a “holistic” approach to gambling regulation, so that legitimate operators remained compliant, and contributed necessary dues.
The news outlet said it approached Pagcor for reaction to Mr Recto’s remarks. It cited the regulator replying: “Our focus remains on regulating the entire Philippine gaming industry and not on any specific segment.”
The consistent position of Pagcor is that a total ban would not prevent locals from gambling online, but merely drive them to unregulated providers and produce harmful outcomes.
Pagcor contributes tax and other social payments from its oversight of the gaming sector. It said in an early-September press release, that licence fees generated from the licensed online gaming sector amounted to PHP69 billion (US$1.2 billion) in the first seven months of this year, of which approximately PHP41 billion came from “e-games”.
But in late October, Pagcor said it had witnessed a “sharp decline” in its income since August. The regulator attributed that to the delinking of online gambling platforms from electronic wallets (e-wallets) – as ordered by the Philippines’ central bank – and a slight decline in the number of new players.
BusinessWorld noted in its Thursday report that last month Antonio A. Ferrer, chairman of the House of Representatives’ Games and Amusements Committee, said it would issue a report by year-end, in relation to a consolidated bill that would propose either a total ban or stricter industry rules.
The news outlet also cited Calixto V. Chikiamco, president of the Foundation for Economic Freedom, a Philippine lobbying organisation, as saying: “Banning [it] will only drive online betting underground where government cannot get its share of tax revenues and where consumers are more exposed to exploitation.”
He added: “It will deter investments in online gaming and allow grey market operators more freedom until regulations are fixed and stable.”
