""~" 
~en\iJt:r 
SIXTEENTIl CONGRESS OF THE REPUBLIC) 
. (@ft.".f I~' ;;;'''rtbr~ 
OF THE PHILIPPINES 
) 
First Regular Session 
) 
'13 
JUL -8 P 3 :11 
SENATE 
S. No. 
Introduced by Senator Ralph G. Recto 
Explanatory Note 
This bill seeks to separate PAGCOR's regulatory function from its role as operator of 
gaming activities. These distinct functions should not be placed under one agency in order to 
maintain a separation of powers and uphold a system of checks and balances. 
There should be a clear separation between the regulatory and proprietary activities of 
PAOCOR in order to achieve a level playing field with other private gaming corporations. The 
government also has no business running gambling facilities. Instead, fue government should 
adopt fue policy that its role should only be steering and not rowing. This means government 
should deal with coordination and control of gaming entities but should not get involved in direct 
gaming operation. 
The delineation of functions will also allow the regulatory agency to focus on the 
supervision and monitoring of gaming operators to ensure that they comply-with fue established 
rules and regulations including compliance with the required remittance of government share to 
the National Treasury. 
Under the bill, the present P AOCOR is abolished while a Philippine Amusement and 
Gaming Commission (P AGCOM) is created which will discharge the function of regulating the 
gaming operations in the country. 
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The existing PAGCOR casinos shall be privatized by the Privatization and Management 
Office (PMO) and proceeds from such privatization shall be remitted to the National Treasury 
and shall form part of the General Fund to be available for expenditure upon authorization of 
Congress through the annual General Appropriations Act (GAA). 
The gaming facilities shall focus on foreign tourists. A license shall be issued to gaming 
operators only in Local Government Units (LGUs) where the tourist arrivals as certified by the 
Department of Tourism are 100,000 foreign tourists per annum or more. Furthermore, in order to 
discourage locals from patronizing the casino, a minimum of Php \,000 entrance fee shall be 
charged. 
The PAGCOM shall collect from casino operators five (5%) percent as gross revenue tax. 
Further, after such deduction, PAGCOM shall collect additional twenty-five percent (25%) from 
the aggregate gross earnings, 75% of which shall be earmarked for the K-12 Program of the 
Department of Education (DepEd) and shall be in addition to fue amounts appropriated in the 
General Appropriations Act; 5% for priority projects of the LOU hosting the gaming facility, 
10% for the creation of a Trust Fund in the Department of Social Welfare and Development 
(DSWD) intended for the establishment and operation of rehabilitation centers for fue treatment 
of addictions including compulsive gambling, drug dependency and alcoholism, among others, 


and 10% for PAGCOM's administrative cost. The 25% share of the National Govermnent shall 
be reflected in the GAA as a Special Purpose Fund. 
In order to ease the impact of the separation from government service, P AGCOR officials 
and employees who will opt not to be absorbed by the new P AGCOM, will receive a Severance 
Mitigation Package (SMP) based on the recommendation of the Governance Commission for 
Government-Owned and Controlled Corporations (GCG) and approval of the-President. 
The SMP benefits shall be on top of whatever separation and retirement benefits those 
officials and employees of the abolished P AGCOR may be entitled to under existing laws. 
However, once the SMP is availed of, they shall not be eligible for employment in the PAGCOM 
for the next five (5) years from separation/retirement. 
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On the other hand, those officials and employees who will opt to stay with PAGCOM and 
will be able to get a regular plantilla position shall enjoy a compensation package that is not 
subject to the Salary 'Standardization Law and should approximate if uot exceed what they have 
been receiving from the abolished P AGCOR, 
This bill will ensure the effective operation of gaming corporations in order to provide 
the government with more funds for the implementation of priority programs. Hence, approval 
of this bill is earnestly sought. 


'semdr 
SIXTEENTH CONGRESS OF THE REPUBLIC) 
(r}1f,;r. uf ttjl' ),.tf"ff'bfll 
OF THE PHILIPPINES 
) 
First Regular Session 
) 
'13 
JUL -8 P 3 :11 
SENATE 
S. No. S30 
Introduced by Senator Ralph G. Recto 
AN ACT 
CREATING THE PHILIPPINE AMUSEMENT AND GAMING COMMISSION 
(pAGCOM), AUTHORIZING THE APPROPRIATION OF FUNDS THEREFOR, AND 
FOR OTHER PURPOSES 
Be it enacted in the Senate and House of Representatives of the Philippines in the 
Congress assembled: 
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Chapter I 
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GENERAL PROVISIONS 
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SECTION 1. Short Title. - This Act shall be known as the "Philippine Amusement and 
Gaming Commission (~AGCOM) Act of2013." 
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Sec. 2. Declaration of Policy. - It is hereby declared policy of the State fo integrate a 
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centralized and efficient regulatory service in the Philippines in the conduct of operation for all 
games of chance and other similar forms of amusement and recreation by providing for the 
creation of a Commission, in such a manner as to promote transparency, efficiency and business 
viability within its jurisdiction. In the pursuit of this policy, this Act shall have the following 
objectives: 
(a) To clearly delineate the operation of gaming activities, on one hand, and regulation, 
on the other; 
(b) To centralize and consolidate all forms of regulatory power, including licensing and 
enforcement, of gaming activities in one governmental entity in order to promote 
efficiency, transparency and good governance; 
(c) To place the operation of gaming activities in the hands of the private sector by 
privatizing PAGCOR's current gaming operations; 
(d) To establish, regulate and issue a license to operate business activities of all games of 
chance and such other similar forms of amusement and recreation, within the 
territorial jurisdiction of the Philippines; 
(e) To ensure that such businesses will generate sources of additional revenue for the 
national government; 


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(f) To eradicate the evils, malpractices and incidence of corruption that are prevalent in 
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the conduct and operation of gaming clubs and casinos which operate in the absence 
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of governmental supervision; 
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(g) To expand and improve the tourism industry; 
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(h) To introduce additional safeguards in the regUlation and operation I of gaming 
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activities; and, 
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Sec. 3. Definition a/Terms. - For purposes of this Act, the terms: 
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(a) "Commission" shall refer to the Philippiue Amusement and Gaming Commission 
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created under Section 4 of this Act. 
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(b) "President" shallTefer to the President of the Republic ofthe Philippines. 
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(c) "PAGCOR" shall refer to the Philippine Amusement and Gaming Corporation 
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created under Presidential Decree No. 1869, as amended by Republic Act No. 9487. 
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(d) "PMO" shall refer to the Privatization and Management Office organized under 
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Chapter 4 ofExe~utive Order No. 323 (S. 2001). 
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Chapter II 
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PHILIPPINE AMUSEMENT AND GAMING COMMISSION 
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THE COMMISSION 
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Sec. 4. Creation. - There is hereby created and established an independent, quasi-judicial 
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regulatory body to be named the Philippine Amusement and Gaming Commission (P AGCOM), 
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hereinafter referred to as the Commission. For this purpose, the Commission shall be attached to 
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the Office of the President for supervision and control. 
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Sec. 5. Powers and Functions. - The Commission shall have the following powers and 
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functions: 
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(a) To provide comprehensive policy guidance for the promotion and development of 
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the Commission, as provided in this Act; 
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(b) To ensure that the Commission performs its functions in a proper, efficient and 
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effective manner; 
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(c) To determine the organizational structure and staffing pattern of the Commission in 
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accordance with the provisions of this Act, subject to existing Department of Budget 
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and Management (DBM) and Civil Service Commission (esC) rules and regulations: 
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Provided, That the P AGCOM compensation plan including a performa~ce incentive 
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scheme, for officials and employees shall be exempted from I the Salary 
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Standardization Law but subject to the recommendation of the Department of Budget 
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and Management and approval of the President of the Philippines; 
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(d) To decide on all matters relating to licenses, certificates, and permits for the operation 
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of gaming activities and prescribe the appropriate terms and conditions thereof; 
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(e) To establish and maintain linkages with international gaming commissions, 
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associations or organizations of other countries, and international non-governmental 
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organizations whose main objective is regulation and supervision of games of chance 
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and other similar recreation and amusement activities; 
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(f) To coordinate and cooperate with other govermnent agencies and entities concerned 
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with any aspect involving the provisions of this Act; 
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(g) To prescribe rules governing proceedings before it; 
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(h) To issue provisional remedies and interlocutory orders, including preliminary 
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injunction, whether prohibitory or mandatory, in all cases in which it has jurisdiction, 
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and in which cases the pertinent provisions of the Rules of Court shall apply; 
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(i) To punish for contempt in accordance with the pertinent provisions of the Rules of 
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Court; 
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(j) To issue subpoena duces tecum and ad testificandum and summon witnesses to 
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appear in any proceedings of the Commission; 
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(k) To administer oaths and affirmations in the transaction and performance of their 
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official duties; 
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(I) To conduct investigations and hearings of complaints for violation of gaming laws 
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and of the Commission's rules and regulations, orders, decisions andlor IjUlings and to 
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impose fines and/br penalties for such violations; 
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(m)To determine, prescribe, approve and periodically review and adjust the manner and 
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method of payment of fees, costs, and penalties to be paid to or collected by the 
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Commission; 
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(n) To formulate policies, directives, programs and projects, as well as the rules and 
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regulations and guidelines to implement the provisions of this Act; and 
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(0) To exercise such other acts as are incidental to or are appropriate and necessary in 
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connection with the creation of the Commission. 
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Sec. 6. Composition, Qualification and Tenure. - The Commission shall be headed by a 
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Commissioner as Chairman and four (4) Deputy Commissioners as members, all of whom shall 
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be appointed by the President for a term of three (3) years and may be reappointed for another 
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term unless removed for cause. They must be citizens of the Philippines, of good moral 
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character, holder of a coJIege degree and with at least five (5) years actual and distinguished 
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experience in their respective fields. 
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The President upon recommendation of the Commission shall appoint an Executive 
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Director. He must be a citizen of the Philippines and of good moral character. The Executive 
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Director shall have the following powers and functions: 
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(a) Advise and assist the Commission in the formulation and implementation ofthe 
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objectives, policies, plans and programs of the Commission; 
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(b) Direct and supervise officials and employees of the Commission; 
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(c) Prepare an annual report on the activities of the Commission at the close of 
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each fiscal year and to submit a copy thereof to the Preside!)t and Congress; 


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(d) Keep and maintain official records and reports of the procee~ingS of the 
Commission; 
( e) Oversee aU the operational activities of the Commission; 
(f) Coordinate the programs and projects of the Commission and be responsible for 
its economical, efficient and effective administration; 
(g) Administer oaths in connection with all matters relating to the business of the 
Commission; and 
(h) Perform such other duties as may be assigned by the Commissioner. 
Any appointment to fill the vacancy in the foregoing provision arising from death, 
removal, retirement or resignation shall be made only for the unexpired term. 
Sec. 7. Meetings and Quorum. - In all cases, the Commission shall convene and act as a 
collegial body in all matters referred to in Section 5 of this Act. The Commission shall meet at 
least once a month, or as determined by the Commission. The presence of at least three (3) 
members shall constitute a quorum. 
Sec. 8. Decision and Appeal. - In all cases or proceedings before the Commission, the 
decision of the majority shall prevaiL Decisions of the Commission shall become final and 
executory fifteen (15) days from receipt thereof. Only one (I) motion for reconsideration shall be 
filed with the Commission. 
The decision, order or resolution ofthe Commission shall be appealable to the Office of 
the President within thirty (30) days from receipt. The decision of the Office of the President 
shall be final and executory unless stayed by an order of the Court of Appeals. 
CHAPTER III 
LICENSING REGULATIONS 
Sec. 9. Registration and Licensing of Gaming Operators.- The Commission shall 
register and issue license, authority, privilege or permit to gaming operators, subject to such 
rules, gnidelines, procedures and other issuances as the Commission may promulgate: 
Provided, That licens~s shall be issued to gaming operators only in municipalities and cities 
with tourist arrivals of 100,000 or more foreign tourists annually as certified by the Department 
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of Tourism (DOT) unless the gaming facility will be located in a new entertainment resort 
facility and the DOT certifies as to the potential tourist arrivals equivalent to or more than the 
required number: Provided, further, That the P AGCOM shall require gaming operators to 
collect an entrance fee of not less than PI ,000 for local players. 
The Commission shall also ensure that the granting and revocation of licenses, 
authority, privilege or permits are carried out fairly, transparently, and without discrimination. 
Sec. 10. Special Condition on License-Holders. - After deducting the five percent (5%) 
gross revenue tax, the Commission shall collect twenty-five percent (25%) of the aggregate gross 
eamings of License-Holders, which shall be remitted to the National Treasury: Provided, That 
the equivalent amount shall be included in the General Appropriations Act (GAA) as a Special 


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Purpose Fund with the following breakdown: ten percent (l 0%) for the administrative cost of 
PAGCOM; five percent (5%) for the Local Government Unit (LGU) hosting the gaming 
facilities; ten percent (10%) for the Department of Social Welfare and Development (DSWD) 
intended for the establishment and operation of rehabilitation centers; and seventy-five percent 
(75%) for the K-12 Program of the Department of Education (DepEd): Provided,further, That a 
Trust Fund is hereby created in the DSWD for the operation of rehabilitation centers for all 
forms of addiction including compulsive gambling, drug dependency and alcoholism: Provided, 
even further, That the 75% allocation for the K-12 Progam of the DepEd shall be in addition to 
the amounts appropriated in the General Appropriations Act. 
CHAPTER IV 
ABOLITION OF PAGCOR 
Sec. 11. Abolition of the Philippine Amusement and Gaming Corporation (fAGCOR). -
The PAGCOR, created' under Presidential Decree No. 1869, as amended by Repuhlic Act No. 
9847, is hereby abOlished. 
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All powers, duties and rights vested by law and exercised by P AGCOR 1ll the 
performance of its regulatory powers, is hereby transferred to the Commission. 
All assets, real and, personal properties, except those that may be privatized under 
Chapter V of this Act, including funds and revenues owned by or vested in the different offices 
ofPAGCOR are transferred to the Commission. 
All contracts, records and documents relating to the powers and functions of the 
abolished agency, its offices and branches are likewise transferred to the Commission. 
CHAPTER V 
PRIV A TlZA TION OF THE PHILIPPINE AMUSEMENT AND GAMING 
CORPORATION (PAGCOR) 
Sec. 12. Privatization of PAGCOR '$ Operations. -
All assets pertaining to the 
operations of gaming activities of P AGCOR shall be privatized and disposed of in accordance 
with this Act, and, as soon as practicable, the Commission on Audit (COA), in coordination with 
PAGCOR, the Commission and the Privatization and Management Office (PMO) shall conduct a 
complete acconnting and inventory of such assets to determine and ascertain their nature, 
description, amount and value, as well as other rights and obligations pertaining thereto, if any. 
Nothing herein shall be construed as preventing the PMO from causing the appraisal by a 
third party of any of the assets prior to or in the course of preparing the privatization or 
disposition plans for the said assets. 
Sec. 13. Additional Mandate of the PMO. - 1n addition to its powers, duties and functions 
under Executive Order No. 323 (s. 2001), as amended, the PMO shall, for and in behalf of the 
National Government, take possession of, conserve, provisionally manage, and dispose of the 
assets which have been identified for privatization and disposition by the Commission. 


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In the discharge of its mandate under Executive Order No. 323 (s. 2001) and this Section, 
the PMO is hereby empowered to implement a specific marketing and disposition program for 
privatization and disposition; to execute and deliver, on behalf of the National Government, 
deeds of sale, contracts, trust instruments, and other legally operative documents as may be 
necessary or appropriate to convey title to, take possession of, and conserve, such assets; to 
engage external expertise as may be necessary in the fulfillment of its tasks under this Act; to 
adopt internal rules and regulations in relation to the marketing and disposition of the assets; and 
to submit periodic reports to the Commission on the status of the disposition program. 
Any and all sales and other modes 'of privatization or disposition or any form of 
divestment or transmission of rights over these assets shall not be considered final unless 
approved or ratified by the Commission. 
Sec. 14. Powers of the Privatization and Management Office.-The PMO is hereby 
accorded discretionary powers with regard to the preparation of the privatization plans and 
policies of the assets transferred to it. The PMO is empowered to enter into sales through public 
bidding, negotiated sale, lease, or any form of divestment or transmission of rights over the 
assets: Provided, That operations of these assets or a partnership with the private sector in the 
management or operation thereof prior to actual sale or disposition shall remain with P AGCOM. 
Sec. 15. Commission to Determine Transfer Value. - The Commission is hereby vested 
with full and complete poWers and prerogatives to determine the indicative sale or transfer 
valuations of the assets identified for privatization or disposition by the PMO, which valuations 
shall be based on COA's audit report or listing as adverted to or those made by a reputable third-
party appraisal firm: Provided, That any valuations approved by the Commission shall not be 
deemed a condonation, waiver, or extinguishment of any obligation by any third rrty to such 
assets. 
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Sec. 16. Reimbursement and Retention. - In order to fulfill its additional rr!andate under 
this section, the PMO shall be reimbursed for reasonable expenses incurred in the management 
and disposition of these assets, subject to pertinent laws, rules and regulations. 
Sec. 17. Remittance 'of Proceeds of Privatization. - All proceeds or receipts from the 
privatization, sale or disposition of the assets, except portions thereof for operational expenses of 
the Commission, or such amount approved by the Commission to be refunded to the PMO under 
the preceding section, shall be remitted to the Bureau of Treasury (BTr). 
Sec. 18. Reporting ReqUirements. - The Commission shall, on a· semi-annual basis, 
submit to the President and to Congress a report on the status of disposition of the assets, which 
shall include, among others, a description of the individual assets privatized and disposed of, 
their purchasers, the consideration received, and the terms of payment as agreed upon. 


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CHAPTER V 
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SEPARATION AND RETIREMENT BENEFITS 
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Sec. 19. Separation and Retirement Benefits. - Officials and employees of the P AGCOR 
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who choose to separate from govermnent service or who shall choose to retire, if eligible, shall 
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be given a Severance Mitigation Package (SMP) in addition to other separation and retirement 
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benefits to which they may be entitled under existing laws and regnlations, and based on the 
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recommendations of the GCG created under R.A. 10019 and approval of the President. 
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Provided, that no affected employee who opt to retire/separate from service shall 
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receive less than an aggregate of Two Hundred Thousand Pesos (Php 200,OO(J).OO) as his 
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retirement or separation benefit: Provided, further, That those who availed of the benefits under 
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the foregoing provisions shall not qualify for re-employment to the Commission within five (5) 
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years from the date of retirement or separation from service. 
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CHAPTER VI 
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FINAL PROVISIONS 
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Sec. 20. Funding. - The budgetary requirements for the operation of the Commission 
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shall be charged against the income ofthe P AGCOM. 
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The cost of retirement and separation benefits of officers and employees of the abolished 
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P AGCOR shall be charged to the funds of the Corporation before its privatization. 
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Sec. 21. Auditor. - The COA may appoint a representative who shall be the Auditor of the 
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Commission and such personnel as may be necessary to assist said representative in the 
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performance of his duties. 
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Sec. 22. Interim Period. - All incumbent officials and personnel of P AGCOR whose 
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positions are vital for the purposes, for which this Act was created, shall continue to discharge 
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the functions of their positions until the Commission has been organized. 
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Sec. 23. Saving Clause. - Unless otherwise provided in this Act, rights and privileges 
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vested or acquired under the provisions of Presidential Decree 1869, as amended by Republic 
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Act No. 9847, its nature and term of franchise, prior to the effectivity of this Act shall remain 
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in full force and effect. 
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Sec. 24. Implementing Rules and Regulations. - Within ninety (90) days from the date 
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of effectivity of this Act, the Commission, the PMO, the Social Security System (SSS), and the 
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DBM, shall formulate the rules and regnlations for the proper implementation of this Act. 
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Sec. 25. Separability Clause. - If any part 01' provision of this Act shall be declared 
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unconstitutional, the other parts or provisions hereof which are not affected thereby, shall 
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continue in full force and effect. 
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Sec. 26. Repealing Clause. -
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(a) Presidential Degree No. 1869, otherwise known as the PAGCOIt Charter, as 
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amended by Republic Act No. 9847 is hereby repealed; 


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(b) All laws, executive issuances, orders and rules and regulations contrary to or 
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inconsistent with the provisions of this Act or any part thereof are hereby repealed, 
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amended andlor modified accordingly. 
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Notwithstanding the foregoing, nothing in this Act shall diminish the powers and 
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functions of agencies, relative to the operation and regulation of gaming activities, provided 
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under Republic Act Nos. 7922, 9490, 1169, as amended, and Presidential Decree Nos. 420 and 
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Sec. 27. Effectivity. - This Act shall take effect fifteen (15) days after its complete 
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publication in the Official Gazette or in two (2) newspapers of general circulation. 
Approved, 
mksbc