The Philippine Amusement and Gaming Corp. (PAGCOR) has cleared three of Manila’s four destination casinos to offer online and remote gambling in the Philippines.
Solaire Resort & Casino, Okada Manila and City of Dreams Manila, all located in the Entertainment City resort enclave, could be accepting wagers from Filipinos by year’s end, according to Andrea Domingo, chairwoman and CEO of the government regulator.
A fourth venue, located in the Subic Bay Yacht Club, about 50 miles west of the capital, is in the software testing phase, she said, and is expected to be up and running soon.
With licenses open to all privately owned casinos, it’s certain that more properties will join the fray in what is shaping up as a serious expansion of the country’s domestic market, the first since Entertainment City was conceived more than a decade ago.
It comes as welcome news, too, both for an industry that’s been devastated by the Covid crisis, and for a national government whose sizable income from gaming taxes and fees has all but disappeared.
PAGCOR generates slightly less than half its revenues from a string of 40 directly operated and satellite casinos and machine gaming venues. The rest from taxes and fees paid by the private market. The total in 2019 topped PHP75 billion, or more than US$1.5 billion, of which PHP56 billion was turned over to the government in the form of direct remittances and contributions to various social and educational programs.
Coming out of a seven-month lockdown, PAGCOR’s take from operations fell 93 percent from the first quarter to the third. Its share of private-sector revenues took another massive hit as gaming revenues from Entertainment City’s four resorts and private casinos located in the Clark Special Economic Zone and elsewhere fell 61 percent over the same period. In net income terms, the agency suffered a decline of more than 97 percent over the first nine months compared to the same period in 2019.
“I think it’s getting better,” Domingo said of PAGCOR’s efforts to dig out.
Speaking in a recent question-and-answer session hosted by industry news and events portal Asia Gaming Brief she described September as “kind of slow.”
“But in October and November it was really good, so that we were able to meet all of our revised targets. I think by the year’s end we should be able to come up with a positive bottom line, and we’ll probably be making 33 billion-34 billion pesos in spite of having been open only four or five months.”
Offshore gaming operations are also on the mend. Of the 61 licensed operators doing business before the pandemic hit and forced most of the Chinese nationals who run them to return home, some 35 have reopened, Domingo said.
At least as large as the entire land-based industry in terms of annual gaming revenues, the POGOs, as they’re known, have evolved into a lucrative source of income for PAGCOR since Domingo came on board in 2016 and the government moved decisively to rein in what largely had been an unlicensed, unregulated industry. Last year, they generated PHP5.73 billion for the agency from a 2 percent levy on win.
The launch of the casino-based platforms is something entirely different but one which PAGCOR hopes will develop into a far more meaningful revenue stream from the combination of a 25 percent tax on win and a 5 percent “franchise tax.”
“Live Shots,” as the network is known, will be open to Philippine residents only, at least initially, and only on a limited basis that combines a close eye on KYC with the government’s ability to head off any problem gambling issues. Deposits and withdrawals must be transacted on-site and betting levels will be closely monitored𑁋although credit play and e-wallets will be options should operators decide to go with them.
“We are very, very strict,” Domingo explained. “Only VIP players that are in (the casinos’) player-tracking systems, are registered with them, will be able to play. No minors or any bad personalities will be allowed to play. It’s very important: 1) that there is no proliferation; 2) that the bets are fair and that they’re protected; and 3) that the appropriate revenues are collected; and, of course, that anti-money laundering regulations and laws are property implemented.”
Games will encompass the range of slots and table games, with some uniquely Philippine products𑁋notably, cockfighting likely to be on offer as well.
“It’s actually like a national sport to us,” Domingo said.
And one, interestingly enough, which PAGCOR hopes will open doors to some foreign jurisdictions when the agency is ready to take “Live Shots” on the road.
“We are focusing on other countries beyond ASEAN and beyond Asia,” she said, “and we think we might be able to penetrate the cockfighting arena in South America and maybe in the southern part of the United States.”
Plans also call for marketing horseracing in the U.S. and dog racing in the UK and Ireland.
“But that will probably be one or two years from now,” she said.
Domingo sees “Live Shots” as a key contributor to Philippine gaming’s return to the PHP250 billion industry ($5 billion) it was before the pandemic, and that’s not counting the POGOs.
Ultimately, she sees it as a lot more.
“I think it can be bigger than land-based.”
