Two online casinos that provide entertainment to Chinese clients will soon leave the Philippines. Gambling regulators revealed a possible case against the companies.
Property and casino shares have declined, as the novel coronavirus continues to ravage the archipelago.
The Philippines has the longest lockdown in Asia and has the fastest increase in the number of cases in the Western Pacific area within the last two weeks. Currently, the country had more than 35,000 cases, including more than 1,200 deaths. On Sunday alone, the country recorded more than 650 infections, with eight deaths.
Coronavirus infection in the country continues to rise, along with its neighboring countries. The Philippine government imposed the shutdown of facilities prone to a mass gathering in mid-March to curve the spread of the deadly pandemic.
During the gradual reopening of the economy, Philippine President Rodrigo Duterte allowed Philippine Offshore Gaming Operators (POGOs) to resume business operations despite criticisms.
POGOS criticized, Lawmakers urged a ban
Lawmakers in the Philippines questioned the operations of POGOS in the Philippines. Critics linked the operations Chinese-catering online casinos to crimes, including kidnapping, prostitution, and human tracking.
In May, Philippine Amusement and Gaming Corp (PAGCOR), Philippine’s gaming regulator, published a newsletter in defense of the online casinos. The regulator said the agencies such as the Bureau of Internal Revenue, the Bureau of Immigration, and the local government unit collects a large amount of taxes and other fees from the companies.
The regulating body is assured that they are closely working with the Chinese embassy to track down illegal Chinese nationals in trouble with the law. The gaming regulator released the article after they allowed the partial reopening of the POGOs in May.
Two online casinos asked to cancel their license
Jose Tria, assistant vice president of PAGCOR, said more than 5,000 employees, mostly foreign nationals, might lose their jobs. Tences Asian Services Solutions and SC World Development Group Ltd. asked the regulating body to revoke their license to operate.
The PAGCOR official said they are doing their best to convince the companies to stay. Stocks of the two companies fell after the news broke out. Bloomberry Resorts Corp shares fell by 9 percent. Suntrust Home Developers, the majority of shares owned by Fortune Noble, a unit of Suncity Group Holdings, fell 7.5 percent.
Megaworld Corporation fell 5.3 percent, Property and casino stocks fell during the trading period.
Astro del Castillo, First Grade Finance managing director, noted that casino operators and developers would suffer a direct hit from the continued withdrawal of online gaming operators. The director said online casinos are an essential market for residential and offices.
Mr. Tria said the prolonged government stay-at-home mandate and the burden of additional taxes and fees affected the operations and revenue of online casinos. Recently, lawmakers proposed to slap additional franchise fees and taxes on online gambling company’s gross revenue. They are also proposing a 25 percent income tax on foreign nationals working for the POGOS.
PAGCOR warned that online gambling operators might choose nations with more relaxed restrictions and lesser operating costs.
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