Philippine President Signs Executive Order 74 to Shut Down Offshore Gaming Operations by 2024

Philippine President Ferdinand Marcos Jr. has formally enacted a complete ban on Philippine Offshore Gaming Operators (POGOs) through Executive Order 74, signed on November 5, 2024. This sweeping action, which takes effect by December 31, 2024, is aimed at closing all POGO operations across the country, including those providing support services and technological infrastructure. The move comes after Marcos vocalized concerns about POGOs during his State of the Nation address in July, where he cited the sector’s connections to crime and corruption as primary justifications for the ban.

With this new directive, Marcos has positioned his administration to eliminate the growing issue of offshore gambling that has drawn international scrutiny. In his statement, he emphasized that this order will put an end to all forms of POGO operations, leaving no room for future attempts to continue these services under different licenses or structures.

Key Reasons Behind the Ban: National Security and Financial Stability

President Marcos has underscored that the decision to ban POGOs was motivated by concerns over national security, financial stability, and the Philippines’ international reputation. The offshore gaming industry has been linked to multiple criminal activities, including online scams, money laundering, and other illicit financial practices. Additionally, Marcos highlighted the damage to the country’s image, particularly the adverse impact on foreign investments and tourism.

One of the primary reasons behind the ban is the Philippines’ efforts to be removed from the global grey list of nations flagged for high money laundering risks. For the past two years, the government has been working diligently to improve its financial systems and remove any obstacles to international partnerships. Eliminating POGOs is seen as a crucial step toward improving the country’s standing and reinforcing its commitment to combating corruption and financial crime.

Marcos expressed confidence that the executive order would fully address the issue, explaining that the nature of the ban precludes the possibility of POGOs returning under any new or modified licensing schemes. “There’s just no way… because it’s the nature of the operation that we are banning,” he said during a recent public address.

Lawmakers Debate Gaps in Enforcement and Potential Loopholes

While the executive order appears straightforward, there has been some debate among lawmakers regarding its scope and enforcement. Senator Risa Hontiveros, a long-time critic of POGOs, raised concerns over potential loopholes that could allow certain gaming activities to continue. Specifically, she questioned whether gaming operations conducted within licensed casinos or integrated resorts might still function as POGOs, particularly in special economic zones where regulations may not be as stringent.

Hontiveros, who chairs the committee overseeing POGO-related issues, has called for more clarification regarding whether the ban applies to all forms of online gaming, including those managed by the Philippine Amusement and Gaming Corporation (PAGCOR), the country’s primary gaming regulatory body. She suggested that without clear provisions, there could still be opportunities for POGOs to operate under alternate arrangements.

In response, President Marcos reassured lawmakers that the ban would apply comprehensively across all areas, including casinos, resorts, and special economic zones. He emphasized that no additional legislation was necessary, as the executive order itself addresses all concerns and ensures that no POGO-related activity could continue under a different guise.

Senate Pushes for Legislative Action to Prevent Future POGO Resurgence

Senator Sherwin Gatchalian, another outspoken critic of POGOs, has called for the repeal of tax provisions specifically designed for POGO operations. He argued that without eliminating these tax exemptions, future administrations might face challenges in enforcing the ban or could inadvertently create a pathway for POGOs to return. Gatchalian has advocated for legislative amendments to completely sever any legal or financial ties to the offshore gaming sector, preventing it from reemerging once the current ban is enforced.

The Path Forward: Enforcement and Cessation of POGO Operations

Executive Order 74 mandates that all POGO licenses and permits will be invalidated by December 31, 2024. To ensure a smooth transition, the Philippine government has established two technical working groups composed of representatives from various departments. These teams will oversee the process of winding down POGO operations and ensuring full compliance with the executive order.

The working groups will be tasked with managing the closure of all POGO-related entities, including operators, technology providers, and support services. The government aims to manage the cessation of these activities methodically, preventing any disruptions or illegal operations from continuing beyond the designated deadline.

Marcos’ executive order marks a decisive step in his administration’s plan to eliminate the Philippines’ association with POGOs. Through this comprehensive ban, the government aims to restore national security, improve financial systems, and create a more favorable environment for both local and foreign investors. While challenges remain, the directive represents a bold move toward addressing the social and economic concerns associated with offshore gambling.