Fueled by advancements in computer technology, the Online Gaming industry has become one of the biggest moneymakers in the Philippines today. As responsible online gaming becomes an accepted form of recreation or diversion for a number of Filipinos, the annual profits of online casinos, bingo and sports-betting companies keep increasing at a tremendous rate. PhilWeb, one of the largest online gaming companies in the Philippines today, posted a profit increase of 52% in the first quarter of 2010 alone. Company revenues also rose by 42%, totaling to about Php 239 million. The number is still expected to double, even as the year progresses.
The introduction of new technology has led to the opening of new avenues for the Philippine gambling industry. The first online casino was created by the Philippine Amusement and Gaming Corporation (PAGCOR) in the year 2000. The government later established a competitive gaming industry in 2002, granting control of online casinos to the PhilWeb Corporation. The development of the online gaming industry led to an unprecedented increase in profits for PAGCOR and PhilWeb, both companies raking in a whopping Php 116 million by the end of 2003. Today, the Philippine gambling industry averages a profit of about Php 50 million per month, or Php 1.8 billion per year.
As the online gambling industry continues to expand, more and more Filipinos are discovering the joys of online casinos, online poker, and other Internet betting games. To satisfy the growing demand, the PAGCOR recently established several PAGCOR e-games cafes – Internet shops specifically dedicated to online casino games. Customers can now play a number of online casino games, including poker, roulette, and blackjack, or bet on anything from the latest sporting events, to the outcome of the next election.
CEZA, short for Cagayan Economic Zone Authority, is a government agency responsible for administering tax breaks and other incentives to gambling companies in the country. Based in the Cagayan Freeport Area, CEZA works hand in hand with PAGCOR in managing the different elements of the country’s gambling industry. This is especially true with BPO companies that do not directly engage in gambling activities, but instead broker technical support services to gaming outfits headquartered abroad. These types of companies are required to register with both CEZA and PAGCOR, and obtain operating licenses from CEZA’s designated Master Licensor, the First Cagayan Leisure Resort Corporation (FCLRC).
The FCLRC, located in the Cagayan Special Economic Zone and Freeport (CSEZFP), issues Interactive Gaming Licenses to gambling companies setting up operations in the country. Licenses include all available forms of online gaming, including casinos, sports betting, and lotteries. As the forefront of gaming in the area, First Cagayan regulates and monitors all activities that pertain to the licensing and operation of interactive games.
Companies that register with CEZA enjoy a 4-6 year income tax holiday, free importation of operating equipment, a special tax rate of 5% of the gross income, after the lapse of the tax holiday period, in lieu of all local and national taxes, and other benefits. CEZA also regulates gaming licenses in the country, including those of internet casinos, and online gaming outfits. More and more casinos are now setting up operations in CEZA zones to take advantage of the tax benefits.
According to Atty. Leslie Charlotte Martin, corporate lawyer for Makati-based firm Kittelson & Carpo Consulting, “Internet gambling has become one of the most lucrative industries globally, and now in the Philippines as well. To cater to the growing demand, more and more online casinos and betting companies are setting up operations in the country, and relocating to CEZA zones. The online gaming industry is not only a great moneymaker for the company owners, but can also provide additional employment opportunities for Filipinos, as well as increase the inflow of investments into the Philippines.”
Online gambling has become one of the most lucrative industries in the Philippines today. Its profits average about Php 1 billion per year. Thus, it is very much apparent that the internet gambling industry is here to stay. The investors can certainly bet on that.