FIFTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES )
First Regular Session )

HOUSE OF REPRESENTATIVES

Introduced by Representative Rufus B. Rodriguez and
Representative Maximo B. Rodriguez, Jr.

House Bill No. 3750

EXPLANATORY NOTE

The Philippine Charity Sweepstakes Office (PSCO) has been reviewing the
franchises of suspected jueteng operators using the small town lottery (STL) as front
for their illegal numbers game operations. PCSO general-manager Ferdinand Rojas
Il, himself admitted that the STL was being used as “front” by some jueteng
‘operators.

As a result, certain governors and mayors have ordered the stoppage or
suspension of STL operations in their areas invoking their alleged absolute
decentralized powers to regulate any business within their territorial jurisdiction
pursuant to the Local Government Code of 1991
However, the Department of Justice issued an opinion upon the request of PCSO
chair Margarita Juico ruling that local government units (LGUs) have no power to
stop the operations of the STL and other similar lotteries in their cities and towns and
that the authority of city or municipal governments to regulate business within their
respective areas of jurisdiction given by Section 447 and 458 of the Local
Government Code of 1991 does not include the power over operations of national
government agencies and its instrumentalities.

The opinion stated further that, “Put differently, it means LGUs have no power
to issue business permits, licenses to the agencies and instrumentalities of the State,
of which the PCSO is one, nor demand or collect permitllicense fees incident to the
issuance of such permitsilicenses,” and “Its duly appointed sales agents are, as you
have pointed out, mere extensions of the PCSO, and should, like the PCSO, be also
considered exempt from the licensing authority of the LGUs where they operate.”

This opinion may have weakened the LGUs because they are now powerless
to act against gambling lords who use the legal STL as a front for illegal gambling,
like jueteng.

In view of the foregoing, immediate approval of this bill is earnestly requested.

NS

RUFUS B. RODRIGUEZ

MAXIMO B. RODRIGUEZ, JR.


FIFTEENTH CONGRESS )
REPUBLIC OF THE PHILIPPINES —)
First Regular Session )

HOUSE OF REPRESENTATIVES

~~ Introduced by Representative Rufus B. Rodriguez and
Representative Maximo B. Rodriguez, Jr.

House Bill No. __ 37 50

AN ACT
REQUIRING THE APPROVAL OF BOTH THE LOCAL GOVERNMENT UNIT AND
THE PHILIPPINE CHARITY SWEEPSTAKES OFFICE (PCSO) BEFORE
OPERATORS OF SMALL TOWN LOTTERY AND OTHER GAMES SANCTIONED
BY THE PCSO START OPERATIONS

SECTION 1. Operators of Small Town Lotteries (STL) and other lotteries sanctioned
by the Philippine Charity Sweepstakes Office (PCSO) are hereby mandated to first
secure a permit from the local government unit where they plan to operate before
they can start their operations.

SEC. 2. The PCSO is hereby mandated to first secure from applicants of STL

franchises the approval of the LGU where they plan to operate before granting the
franchise.

SEC. 3, All STL franchise holders as of the approval of this Act are given sixty (60)
days to secure the necessary permit from the LGU where they are operating in order
for them to be able to continue their operations.

SEC. 4. Repealing Clause. - All other laws, decrees, orders, issuances, rules and
regulations which are inconsistent with the provisions of this Act are hereby
repealed, amended or modified accordingly.

SEC. &. Separability Clause. - If, for any reason, any provision of this Act, or any part
thereof, is declared invalid or unconstitutional, all others sections or provisions not
affected thereby shall remain in force and effect.

SEC. 6. Effectivity. - This Act shall take effect fifteen (15) days after publication in
two (2) newspapers of national circulation.

Approved,