Press Release
August 9, 2010

Drilon: Pagcor should not be operating casinos,
only exercise licensing and regulatory functions

Senator Frank Drilon today said he was in favor of the proposed privatization of casino operations in the country but said the Philippine Amusement and Gaming Corp. (Pagcor) should retain its licensing and regulatory functions and bid out casino operations to the private sector through an open and transparent process.

"The present set up wherein Pagcor serves as both the licensor and operator of casinos is anomalous. There is a clear conflict of interests here," said Drilon, adding that while Congress can amend the current Pagcor Charter, there was no law stopping President Beingo "Noynoy" Aquino II from "adopting a policy that, henceforth, Pagcor should no longer engage in the operations of casinos."

Drilon said as a matter of policy, Pagcor should not be operating casinos in the Philippines. "In other jurisdictions such as in Las Vegas and in Macau, the government agency concerned only issues the necessary licenses and regulates the gambling operations," Drilon said.

"They do not operate casinos. The privileges of operating casinos in Las Vegas and in Macau are bided out to the private sector in an open and transparent manner."

Drilon, who is chairman of the Senate Committee on Finance, said the income generated from the licensing of the casinos "should go directly to the government's general fund just like ordinary taxes collected."

"This system will eliminate leakages in government income from the casino operations," Drilon pointed out.

He lamented that, at present, too much discretion were being given to the members of the Pagcor Board of Directors "who are entitled to huge amounts of intelligence funds that are not even subject to regular government auditing procedures."

Without mentioning the proposal of San Miguel Corp. vice chair Ramon S. Ang to privatize Pagcor, Drilon said government can now start bidding out casino operations. "I have no problem with privatizing casino operations provided that these are bided out in an open and transparent manner," Dilon said.

But Drilon said Congress should now amend Republic Act No. 9487, also known as the Pagcor Charter, so that "future administrations will no longer be able to revert to the old practice of operating casinos." Drilon said.

"Pagcor should limit itself to issuing licenses and regulating casino operations," Drilon said. He said Pagcor should only exercise regulatory powers similar to the powers of the Games and Amusement Board (GAB) and the Philippine Racing Commission (PRC).

Earlier, Ang proposed that government can privatize Pagcor to raise as much as $10 billion and transform the country into a tiger economy. Ang said he himself planned to make a bid to acquire Pagcor with his Malaysian financiers.

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