Supreme Court concurrence finds PAGCOR committed no grave abuse in issuing POGO rules

The Philippine Supreme Court ruled on April 25, 2023 that the Philippine Amusement and Gaming Corporation (PAGCOR) did not commit grave abuse of discretion in issuing the Rules and Regulations for Philippine Offshore Gaming Operations (POGO), according to a separate concurring opinion by Associate Justice Marvic M.V.F. Leonen¹. The opinion was issued in the consolidated cases G.R. No. 228234, G.R. No. 228315 and G.R. No. 230080, which questioned the constitutionality of the POGO rules¹.

The petitions were filed by Jovencio H. Evangelista, Miguel Daniel C. Cruz on behalf of UNILAD-Philippines, and the Anti-Trapo Movement of the Philippines, Inc.¹. They argued that PAGCOR had no authority to operate and regulate online gambling under its charter, and asked that the rules be declared null and void for being unconstitutional¹. The court's ponencia found that the remedies of certiorari and prohibition were proper, that direct resort to the Supreme Court was proper, that the substantive issue warranted exception from the requirements of judicial review, and that PAGCOR did not commit grave abuse of discretion¹.

Leonen agreed with the ponencia that PAGCOR committed no grave abuse of discretion, but disagreed with its finding that the petitions presented an actual case or controversy¹. He wrote that the petitioners lacked legal standing and that there was no transcendental importance to override that requirement². He voted to dismiss the consolidated petitions¹.

The opinion also referenced the legal framework for PAGCOR's authority. P.D. No. 1869 was issued on July 11, 1983, and R.A. No. 9487, which amended Section 10 of P.D. No. 1869, was approved on June 20, 2007¹. Leonen noted that in his dissenting opinion in Saint Wealth Ltd. v. Bureau of Internal Revenue, G.R. No. 252965, December 07, 2021, he joined Associate Justice Amy C. Lazaro-Javier in concluding that offshore-based POGO licensees are doing business in the Philippines and are subject to regulation by Philippine authorities¹. The opinion also stated that there is no other authority under existing laws explicitly granted the mandate to issue online gaming licenses and regulate the same, other than the Aurora Pacific Economic Zone and Freeport Authority under Section 12 of R.A. No. 9490 as amended by Republic Act No. 10083¹.

The petitions also raised the imposition of a 5% franchise tax on income arising from the gaming operations of offshore-based POGO licensees¹. The sources do not state the outcome of that specific issue.

What it means for players

The Supreme Court's ruling leaves PAGCOR's POGO rules in force, so the licensing and regulatory framework for offshore gaming operators that serve players outside the Philippines remains in place. For people gambling in the Philippines, the decision does not change the rules for domestic casinos, licensed sports betting or other PAGCOR-regulated games. The case concerned the authority to regulate offshore operators, not the legality of gambling for individuals in the country. The sources do not say whether the ruling affects tax obligations for players or operators. Anyone looking at how gambling is regulated in the Philippines can check the Philippines guide and the wider gambling laws overview.

What happens next

The separate concurring opinion was promulgated on April 25, 2023¹. The sources do not report any further appeals, enforcement actions or legislative steps following the decision.