RA 9487

Republic Act No. 9487, the law extending Pagcor’s franchise, was signed by Philippine President Gloria Macapagal-Arroyo June 20th. If you recall, this bill (House Bill 3409)  was approved on Feb. 19 during Congress’s special session.

The law extends Pagcor’s franchise, expiring on July 11, 2008, by another 25 years. The key provision is that instead of just having the right to run casinos, Pagcor now has “authority to operate and license gambling casinos, gaming clubs, and other similar recreation or amusement places, gaming pools, etc.”

Earlier Supreme Court jurisprudence had nullified a Pagcor contract with the now defunct Sage, with the high court finding that Pagcor had the authority to operate, but not sub-franchise its franchise.

Another key provision is that Pagcor must “obtain the consent of the local government unit that has territorial jurisdiction over the area chosen as the site for any of its operations.” Previously, Pagcor was not legally required to get the LGU consent, though in practice it did.  

Everything But Pacific

It was a great bet, if you could get your broker to take your money.

Shares of Pacific Online Systems Corp. , the exclusive operator of lotto outlets in the Visayas and Mindanao regions, had a rip-roaring ride, jumping almost 50% in their debut on the Philippine Stock Exchange. The stock went from its IPO price of P8.88 to P13.25.

The company sold 39.8 million shares to investors (it has 191 million shares in total). With the first-day rise of P4.37 per share, the people who were able to get any of the 39.8 million up for grabs are now collectively P174 million pesos richer. Not bad.

Pacific Online president Willie Ocier attributed the company’s successful public offering to its growth potential. “I think the reason why the stock performed very well is because of the belief of the investing public that we are a growth company. We are hopeful that the new products that will be offering will contribute to the growth of the company,” Ocier told reporters following the listing ceremony for Pacific Online shares.

The exciting thing for gamblers are the new games forthcoming:

Power Lotto is similar to current lotto games but a ticket is priced higher at P50 and the jackpot price worth P50 million. EZ 2 is a two-digit game aimed at competing with local jueteng while Keno is the marathon lottery game.

The state-owned Philippine Charity Sweepstakes Office is evaluating the new gaming products.

Ocier said Keno, the fastest-growing lottery game in Australia, would be launched by the second half of the year. Pacific Online plans to set up 200 parlor sites for Keno within the year at a cost of some P30 million.  

Betting on Betting

Come April, there will be another way to bet on the gambling industry in the Philippines. Pacific Online Systems Corp., which operates 1,048 lotto terminals, primarily in the Visayas and Mindanao regions, will begin trading on the Philippine Stock Exchange. So if you believe in Filipinos’ love of gambling, which will you play : Pacific Online, Leisure & Resorts (LR), PhilWeb (WEB), or the thinly traded Prime Gaming (PGPI)? Which will you put your money on?

Pacific Online Systems Corp., the exclusive online lottery system provider of state-owned Philippine Charity Sweepstakes Office in Visayas and Mindanao, has filed an application to sell shares to the public.

Belle Corp., the majority shareholder of Pacific Online, said in a disclosure to the stock exchange that the gaming company filed its initial public offering application with the Securities and Exchange Commission.

The company did not provide additional details on the offering.

The public offering, which could be the first IPO for the year, is expected to generate as much as P250 million in proceeds.

Join Raffle, Uncover Tax Cheats

The joint Burea of Internal Revenue and Pagcor-sponsored game Premyo sa Resibo is less than a year old. While consumers get raffle tickets, and the chance to become millionaires, the government has been getting a trove of data. And so far, that data is revealing how many retailers hate paying taxes.  What is it that pundits often say? To end our budget deficits, the government does not have to pass new tax laws, just enforce the existing ones.  

A popular government raffle program has uncovered massive tax cheating by more than half of the 140,000 establishments whose receipts were submitted by consumers to the Bureau of Internal Revenue for a chance to win P1 million.

From June to August 2006, Teves reported that the Premyo-sa-Resibo campaign had resulted in the gathering by the BIR of some 7.8 million receipts covering about 140,000 establishments.

“Of these establishments, only 52.6 percent had valid TINs (Tax Identification Numbers). About 51.2 percent had no records of income tax payments with the BIR, while the rest had made only minimal income tax payments,” Teves said.

He said the BIR Central Office had disseminated the information to the regional districts so they could conduct investigations and audits.

When is $1 Million Not $1 Million?

“Read the fine print” is the perennial advice to us consumers. Check this story about a $1 million lottery winner not being able to pay for his medical bills. Not only do the rules say that the top prize should be disbursed over 20 years, there’s also the taxman taking his portion of the winnings.

Million-dollar lottery winner Wayne Schenk doesn’t feel very lucky, in spite of hitting the jackpot.

That’s because the dying ex-Marine was diagnosed with incurable lung cancer five weeks before snatching the $1 million prize on a $5 scratch-off ticket — but the New York Lottery says no dice on paying him in full.

With doctors giving him little more than a year to live, the former Marine has no need for a new house, or a fancy car. He’s hoping to buy a little time — by checking into a Philadelphia hospital that specializes in treating advanced-stage cancers.

The $1 million New York Lottery prize pays out in $50,000 annual installments over 20 years, and the Eastern Regional Medical Center told him it would need $125,000 up front and $250,000 in reserves to be tapped as his treatment proceeds.

Enjoying Your Earnings

If you win the lotto or make a killing at the baccarat tables, how would you spend your winnings? If you’re the type who likes to tickle her tonque with exquisite tastes and exotic flavors, here’s one way to do it.

Foodies are flying in to Bangkok from far-flung corners of the world this weekend to experience a scintillating 11-course gala dinner — with a one-million-baht price tag.

Only the most well-heeled food and wine connoisseurs are expected to take a seat at the exclusive table in the Thai capital, where the feast will be prepared by six Michelin three-star chefs from Europe.

“We limit at 40 seats, and right now it’s fully booked,” said Kanokrat Petchpornprapas, a spokeswoman for Mezzaluna, the restaurant holding the event at the top of one of Bangkok’s tallest and most luxurious hotels, overlooking the Chao Phraya River.

Gravity Shift

It’s inevitable, they would say. As our giant neighbor-to-the-north China gets richer, there’s more disposable income, and that money will inevitably find its way into . . . . what the industry likes to call “leisure activities.”   

The NYTimes says in 2006, Macao brought in more revenue than the famed Las Vegas strip. So soon, the one city in the world’s most populous country where it’s legal to bet will supplant Las Vegas as the global byword for gambling. 

 ”What happens in Vegas, stays in Vegas” was a phrase in an ad promoting the U.S.’s Sin City. Does “What happens in Macao, stays in Macao” have the same ring? Just hope that Macao’s limited land area for expansion will mean a spillover of the Sino gambling crowd into the Philippines.

Fueled by a casino investment boom and the millions of Chinese visitors flooding in, Macao said its gambling revenue had soared 22 percent in 2006, to $6.95 billion. A Portuguese colony that was returned to China in 1999, Macao is the only place in China where gambling is legal, and last year it attracted more than 22 million visitors, mostly from China.

This year, Macao may take in $8 billion in gambling revenue, according to industry analysts, up from $2 billion in 2001. Macao is still behind the entire state of Nevada, which in 2005 reported close to $12 billion in gaming revenue. “Whether or not Macao passed Las Vegas last year is just a headline,” said Harry Curtis, a gambling analyst at JPMorgan. “The fact is, as we stand today, Macao is going to be a bigger market than Las Vegas. And by the end of the decade it could be twice the size of Las Vegas.”

25, followed by nine zeroes

See here Pagcor’s performance for 2006.  The question to ask is: how big can Pagcor grow, given that Asia is seeing an upsurge in the gambling/gaming industry? Pagcor has long been an “export company”, deriving a big chunk of its revenue from regional high-rollers who plane in to catch the action in any of its casinos.

But the game is changing. Galloping wealth in China will see a horde of Chinese tourists eager to test their luck. Even with casinos opening up in Singapore, Korea, besides those already famous ones in Macau, will there be enough for the army of punters from the People’s Republic?

Culture

Some commentary on the Philippines’ gambling culture. The picture gives that added impact.

Gambling appears to be part of life for many people in the Philippines, a country where life has for the most part been harsh enough to make not a few turn to luck and chance for hope.

Almost The Biggest Regret

See this story about a winner who almost forfeited a million pesos. Sometimes our fears get the better of us. Without the intervention of others, she would have lived up to her last name.

Fate, however, was smiling on the young woman. A few days before the end of the 60-day period, a distant relative who worked for the BIR dropped by Dolor’s house and told her about her windfall.

Dolor immediately sent word to PhilWeb, the BIR and Pagcor, and prepared for her eight-hour trip to Metro Manila.

“It’s surreal,” she said. “Every day I hear about people winning the lottery, the sweepstakes, raffles at malls, but I’ve never met any of them. Now that I’ve won, I believe.”