Legal Competition II
March 14, 2007
Let’s take a walk through the legislative landscape, and examine the specific laws which created our special (gaming) economic zones.
RA 7903, officially known as the Zamboanga City Special Economic Zone Act of 1995, created the ZamboEcozone Authority. This is one of many zones that have mushroomed throughout the archipelago, of which the more famous ones are in the former U.S. bases, Subic and Clark. The zones are legal jurisdictions carved out from the rest of the Philippines, on the premise that a special zone able to provide abundant tax breaks can attract more businesses to locate in the country, thereby creating more jobs than would otherwise have been created.
Section 7 of the governing law for the ZamboEcozone Authority states its powers and functions, of which the relevant clause is this:
(f) To operate on its own, either directly or through a subsidiary entity, or license to other tourism-related activities, including games, amusements and recreational and sports facilities;
Take note of that language. We’ll revisit it soon.
On the other hand, there is Republic Act 7992, otherwise known as the Cagayan Special Economic Zone Act of 1995. Section 6, the relevant ”Powers and Functions” section, says:
(f) To operate on its own, either directly or through a subsidiary entity, or license to others, tourism-related activities, including games, amusements, recreational and sports facilities such as horse racing, dog racing, gambling casinos, golf courses, and others, under priorities and standards set by the CEZA;
Note that the CEZA law does not directly state that it can do Internet gambling; there is no language prohibiting it either. What it does state is that CEZA can license “sports facilities such as horse racing, etc.” under the umbrella of “tourism-related activities.” Is that umbrella wide enough to encompass Internet gambling?
But it is worth noting that CEZA’s language is much more explicit than ZSEZA’s. Again, ZSEZA’s enabling law merely states that it can do ”games, amusements, and recreational and sports facilities.”
How wide is the GARS language? Is it wide enough to include Internet gaming and gambling? The chief regulator of all gambling in the country is known as the Philippine Amusement and Gaming Corp., abbreviated to Pagcor, so ZamboZone proponents can argue that the terms “amusement” and “gaming” encompass gambling.
This isn’t all semantics. Given the nature of the Philippines, there’s always the risk that someone will challenge both CEZA and ZSEZA. And whatever court challenge may appear will eventually go all the way to the Supreme Court. That process will take several years; in the meantime, those that do establish online casinos can make hay while the regulatory sun is shining.
Entry Filed under: ALL, Bingo, Blackjack, Casino Games, Gambling, Internet, Legal/Law, Leisure & Resorts, Pagcor, PeJI, PhilWeb. .
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1. Games & Amusements « Games, Chances, Odds | June 13, 2007 at 10:40 am
[...] wrote in March that there could be a legal challenge mounted to see if the GARS language (games, amusements, [...]
2.
Alfredo | June 19, 2007 at 2:38 am
A new twist to this:
On June 8, 2007, the Department of Justice, in a letter penned by Secretary Raul Gonzalez, upon the request of PAGCOR Philippine Amusement and Gaming Corporation Chairman Efraim C. Genuino, is recalling/reconsidering the Department of Justice ‘s May 8 2007 (Opinion No. 22, Series of 2007) that ZAMBOECOZONE has the authority to operate games, including online/internet gambling inside the ZAMBOECOZONE.
In the Department of Justice letter to the Chair and Administrator of the Zamboanga City Special Economic Zone Authority, Ms. Georgina Yu, Secretary Gonzalez questioned the non-disclosure of ZAMBOECOZONE on the following:
1. That a previous opinion, on the same issue, has already been rendered by the Office of the President that specifically stated that the Zamboecozone has no authority to issue interactive gambling licenses;
2. That a petition on prohibition has been filed against Zamboecozone Authority and PeJI is pending before the Supreme Court and docketed as G.R. No. 177333 (and thus by settled precedents the Secretary of Justice cannot rule on legal questions with pending litigation in court).
3. That a “Cease and Desist” Order has already been issued by PAGCOR against PeJI.
3.
kenneth vincent p. beldua | July 17, 2007 at 3:27 am
true that indeed the zamboecozone law does not explicitly state that it can authorize the operation of casinos but again as stated by some of the commentors here: IS THERE ANY SECTION or PROVISION in the said statute that PROHIBITS the operation of internet gambling? and where should we classify the term gambling? Should not it be included in the umbrella term ‘games’ and “amusement?”
Clearly, there is political maneuvering here. The success of a particular economic zone should not be hampered just because of technicalities that do not even explicitly state that such is unallowable.
4.
Alfredo | July 23, 2007 at 9:09 am
Yes, there are arguments both ways. And of course there
are subtle political issues working in the background.
But the issues concerning whether Zamboecozon can proceed or not should be settled first rather than going forward and then finding out later on that certain acts are not legal or allowed under its charter.
I am guessing that this issue can even go up all the way to the Supreme Court.
5.
makoy | October 2, 2007 at 3:08 am
although there is no language or provision the zamboanga ecozone law that prohibits it to operate gambling, said law must be read in relation to PD 1602, the general anti-illegal gambling law.
being the general law, it is a blanket prohibition on all forms of gambling in the philippines. thus, any person, whether it be a private operator or a government entity such as economic zones or pagcor must show that it is allowed to operate gambling under another law, thus exempting it from PD 1602.
CEZA has that exemption when its law says it can have casinos, dog racing, horse racing within its ecozone in Cagayan.
SUBIC is also exempted from the anti-illegal gambling law when it also said that it can have casinos, horse racing and dog racing inside SBMA licensed by PAGCOR
PEZA ecozones can have PAGCOR licensed gambing because it enjoys the same benefits and privileges as SBMA under an ipso facto clause in the PEZA law.
ZAMBOANGA does not have that exemption. it does not have any language allowing casinos inside its ecozone like Subic and CEZA and it does not have the ipso facto clause that allows PAGCOR-licensed casinos inside PEZA ecozones.
considering that we are talking here of gambling which is prohibited and criminalized under PD 1602, there must be a very clear authority exempting Zambonaga from the prohibited/ criminalized act absent such clear grant of authority, PD 1602 applies.
The same law which prohibits and criminalizes jueteng, masiao, ending, etc. also prohibits and criminalizes Zamboanga ecozone’s gambling operations.
6.
makoy | June 4, 2009 at 9:04 pm
The supreme court already handed a ruling in this case, according to the decision:
“The Court finds that, indeed, R.A. No. 7903 does not authorize the ZAMBOECOZONE Authority to operate and/or license games of chance/gambling.”
“The words “game” and “amusement” have definite and unambiguous meanings in law which are clearly different from “game of chance” or “gambling.” In its ordinary sense, a “game” is a sport, pastime, or contest; while an “amusement” is a pleasurable occupation of the senses, diversion, or enjoyment. On the other hand, a “game of chance” is “a game in which chance rather than skill determines the outcome,” while “gambling” is defined as “making a bet” or “a play for value against an uncertain event in hope of gaining something of value.”
read the whole thing here: http://sc.judiciary.gov.ph/jurisprudence/2009/april2009/177333.htm