Tensions in Philippines as Casino Licenses Open Up

Makati Skyline at night. Makati is a city in the Philippines` Metro Manila region and the country`s financial hub.

There was a shocking scene in the Philippines this week as President Rodrigo Duterte sacked one of his government’s lawyers for suggesting that casino permits be opened up. In a scene reminiscent of a game show, Duterte called out the lawyer in a fiery outburst.

Duterte lost patience

Officials from APECO (Aurora Pacific Economic Zone) have been told they should be able to grant licenses for land-based casinos in the Philippines, but the country’s president, Rodrigo Duterte, strongly disagrees. The fallout came after the government corporate counsel, Rudolf Philip Jurado, recommended that the APECO be granted similar rights to the Philippine Amusement Gaming Corporation (PAGCOR) in granting casino licenses in the country.

Duterte reportedly fired Jurado in a public outburst, telling ABS-CBN: “May I call the government corporate counsel now? Are you here? Because if you are here, come out. You are fired.

“I have been trying to be patient with everybody. But there is always that opportunity to interpret a law or insist in your stupid proposition until the problem gets out of hand.”

Although the lawyer Jurado was basing his argument on legislation regulating the economic area, the President was questioning the interpretation. The query now being posed is whether the Philippine Economic Zone Authority (PEZA) has been granting licenses without informing PAGCOR.

How regulation works

Gambling in the Philippines is regulated by PAGCOR and the Philippine Charity Sweepstakes Office (PCSO). The former is the government agency responsible for implementing regulations and the latter is a government-backed lottery scheme aiming to support charities through the money raised by the game.

The laws on gambling in the Philippines allow for a relatively wide range of betting and land-based gaming, including legal casinos, lotteries, betting on horse racing, online gambling, and cockfighting.

There are other forms of gambling that are prominent in the country even though they are illegal, but the relatively relaxed laws mean that most people engage in legal gambling.

Limited licensing going forward

This latest fallout came after President Duterte ordered limits on the numbers of casino licenses being granted in order to prevent the oversupply of gambling services.

PAGCOR has not been processing license applications since the President made the request back in February 2018 and this has increased the pressure on PEZA and the potential granting of licenses in the county by a third party.

With the limitations on gambling in other countries near the Philippines, the recent outburst could slow down their growth.

So far, the country has been a hot spot for gaming companies and gamers alike, but if the granting of licenses slows down it may be that other countries, such as Thailand, will see this as an opportunity to capitalize on the market.

The number of casinos in the country is already very high and iGaming is legal, so it is possible that there will be little impact on the revenue generated by gaming as a whole, but the market may adjust and move toward online gaming in the middle to long term.

Filipino gambling history

Gambling in the Philippines can be traced back to the 16th Century and is still a popular pastime in the country.

To give a better idea of scale, there are more casinos in Manila than in Macau. Because gambling is banned in many countries surrounding the Philippines, the country has capitalized on the market so far, but this could all change under Duterte.