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A Senate bill seeks to change the mandate of an agency that runs casinos, issues gaming licenses, and regulates gambling in the country.
Instead managing casinos and issuing licenses, the Philippine Amusement and Gaming Corp (Pagcor) should just be a full regulatory agency, a transformation that would allow it to rake in an additional P250 billion in annual revenues.
Under Senate Bill 3187, Pagcor would cease its casino operations and sell its licenses, proceeds of which would be remitted to the national treasury.
“The new Pagcor or Pagcom (Philippine Amusement and Gaming Commission) would be fully focused on registering, overseeing and issuing license, authority, privilege or permit to gaming operators,” said Senator Ralph Recto, who filed the bill.
Recto has argued that Pagcor’s two distinct functions--regulation and casino operation--should not be placed in one agency and is incongruent with the national policy of “levelling the playing field” in the gaming industry.
Once established, the Pagcom would further strengthen the gaming agency and prepare it for the challenges brought forth by the Entertainment City project.
“We’re not abolishing or emasculating Pagcor. We are, in fact, shepherding its return to its main core function which is, to provide regulation over the gaming industry,” he said.
He added: “We’re just correcting an anomaly wherein the one given the task to issue casino licenses is also allowed to operate its own outlets. It’s tantamount to licensing Count Dracula to run a chain of blood banks while giving exclusive accreditation to blood donors."
Without the right focus, Pagcor may be unable to fully exercise competent supervisory and regulatory functions and ensure correct revenue share collection since it is also tied up with casino operations.
Recto also assured that the bill would uphold existing licenses, franchises, and contracts once Congress enacts it into law.
“All contracts and licensing agreements forged under the old Pagcor would be respected while the prospective Philippine Amusement and Gaming Commission or Pagcom waddles through transition,” Recto, who is also Senate ways and means chair, said.
Recto cited “Saving Clause” in Section 23 of his measure which guarantees that “unless otherwise provided in this Act, rights and privileges vested or acquired under the provisions of Presidential Decree 1869, as amended by Republic Act 9847, its nature and term of franchise, prior to the effectivity of this Act shall remain in full force and effect.”
$6B annual revenue share from Entertainment City
Once the Entertainment City project becomes fully operational, Pagcor as a regulatory body could realize as much as $6 billion in revenue share or about P250 billion in fresh revenues every year, Recto said.
He said this would dwarf Pagcor’s current remittance to government of around P15 billion annually.
“No timetable related to Entertainment City project would be waylaid. As a matter of fact, the shift to being a commission will fully make Pagcor capable of overseeing the four big casino-hotel projects in Entertainment City and protecting the government share,” Recto said.
“And once these four major casino projects come in full swing, Pagcor-owned casinos would surely be losing money fast due to the stiff competition posed by the new modern casinos in Entertainment City, which would truly rival the gaming centers in Macao and Singapore,” Recto added.
The Entertainment City project will be anchored by four major casino-hotels operated by Travellers group, Tiger Resorts, SM Consortium and Bloomberry with the first anchor-locator debuting early next year.
Pagcor is expected to draw revenue share of 15 percent from high-roller gaming, 25 percent from non-high roller games and another 5 percent from food and beverages.
Privatization of casinos
Recto stressed the privatization of Pagcor-owned casinos would naturally become inevitable once they start to incur huge losses from stiff competition, shrinking their revenues and ultimately, reducing government share.
The senator said the government could easily earn another P100 billion to P150 billion from the privatization of Pagcor’s casinos.
He said affected Pagcor personnel could reap handsome severance packages as guaranteed by his proposed measure and who are more than qualified to steward privately-run casinos and get higher compensation in return.
Recto said the transformed Pagcor would likewise continue and enhance present funding support to Malacanang’s priority projects like infrastructure, education, and health.
“It is also not wishful thinking that with a P250-billion new cash going into the national coffers, there would be less pressure to collect new taxes,” Recto said. InterAksyon.com