ChanRobles Virtual law Library

A collection of Philippine laws, statutes and codes
not included or cited in the main indices
of the Chan Robles Virtual Law Library




WHEREAS, new sources of revenues must be created by the government to help finance priority infrastructure and socio-civic projects within the Metropolitan Manila Area to stabilize social growth and accelerate national economic development;   ESTDIA

WHEREAS, the operation and conduct of games of chance have been identified by historical statistics and after a careful study and survey as a potential source for generating these additional revenues; provided such games of chance are strictly manageable and made subject to close scrutiny, direction, supervision and control by the government;chanroblesvirtualawlibrary

WHEREAS, such management and supervision can only be effectively exercised if the operation and conduct of games of chance is operated by or thru a government owned/controlled corporation;chanroblesvirtualawlibrary

WHEREAS, sixty (60%) percent of the gross earnings derived by the grantee of this franchise shall be allocated to finance priority infra-structure and socio-civic projects;   cAHITS

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines by virtue of the powers vested in me by the Constitution, hereby decree a Franchise in favor of the Philippine Amusements and Gaming Corporation, any provision of law to the contrary notwithstanding.

Section 1.    Nature and Term of Franchise. — Subject to the terms and conditions established in this Decree, the Philippine Amusements and Gaming Corporation is hereby granted for a period of twenty-five (25) years, renewable for another 25 years, the right, privilege, and authority to operate and maintain gambling casinos, clubs and other recreation of amusement places, sports gaming pools, i.e., basketball, football, etc., whether on land or sea, within the territorial jurisdiction of the Republic of the Philippines.

Section 2.    Scope of Franchise. — In addition to the right and privileges granted it under Sec. 1, this Franchise shall entitle the franchise holder to do and undertake the following:cralaw:red

(1)    Enter into operator's and/or management contracts with duly registered and accredited company possessing the knowledge, skill, expertise and facilities to insure the efficient operation of gambling casinos; Provided, That the service fees of such management and/or operator companies whose services may be retained by the franchise holder of this Franchise shall not in the aggregate exceed ten (10%) percent of the gross income.   ECSHAD

(2)    Purchase foreign exchange that may be required for the importation of equipment, facilities and other gambling paraphernalia indispensably needed or useful to insure the successful operation of gambling casinos.

(3)    Acquire the right of way access to or thru public lands, public waters or harbors, including the Manila Bay Area; such right to include, but not limited to, the right to lease and/or purchase public lands, government reclaimed lands, as well as land or private ownership or those leased from the government. This right shall carry with it the privilege of the franchise holder to utilize piers, quays, boat landings, and such other pertinent and related facilities within these specified areas for use as landing anchoring, or berthing sites in connection with its authorized casino operations.

(4)    Build or construct structures, buildings, coastways piers, docks, as well as any other form of landing and berthing facilities for its floating casinos.   cASTED

(5)    To do and perform such other acts directly related to the efficient and successful operation and conduct of games of chance in accordance with existing laws and decrees.

Section 3.    Special Condition of Franchise. — Sixty (60%) percent of the aggregated gross earnings derived by the franchise holder from this Franchise shall be immediately set aside and allocated to fund the following infrastructure and socio-civic projects within the Metropolitan Manila Area:cralaw:red

(a)    Flood Control.

(b)    Sewerage and Sewage.

(c)    Nutritional Programs.

(d)    Population Control.

(e)    "Tulungan ng Bayan" Centers.

(f)    Beautification.

Section 4.    Exemptions. —
(1)    Duties, taxes and other imposts on importations. — All importations of equipment, vehicles, boats, ships, barges,rcraft and other gambling paraphernalia or facilities for the sole and exclusive use of the casinos, clubs and other recreation or amusement places to be established under and by virtue of this Franchise shall be exempt from the payment of duties, taxes and other imports.

(2)    Income and other taxes. — No income or any other form of taxes shall be assessed and collected under this Franchise from the franchise holder; nor shall any form of tax or charge attach in any way to the earnings of the franchise holder, EXCEPT a Franchise Tax of five (5%) percent of the gross revenue or earnings derived by the franchise holder from its operation under this Franchise. Such tax shall be due and payable quarterly to the National Government and shall be in lieu of all taxes of any kind, nature or description, levied, established, or collected by any municipal, provincial or National authority.

Section 5.    Other Conditions. —
(1)    Place. — The franchise holder shall conduct the gambling activities or games of chance on land or water within the territorial jurisdiction of the Republic of the Philippines.

(2)    Time. — Gambling activities may be held and conducted at anytime of the day or night; Provided, however, That during curfew hours all players and personnel of the gambling casinos shall remain within the premises of the casinos.

(3-a)    Persons allowed to play. —
(a)    Tourists and/or foreigners who are not residents of the Philippines.   IHcSCA

(b)    Residents with a net income for the previous year of at least P50,000.00, which fact to be certified to by the Bureau of Internal Revenue.

(3-b)    Persons not allowed to play. —
(a)    Government officials connected directly with the operation of the government or any of its agencies.

(b)    Members of the Armed Forces of the Philippines, including the Army, Navy,r Force or Constabulary.

(c)    Persons under 21 years of age or students of any school, college or university in the Philippines.

From these are excepted the personnel employed by the casinos, special guests, or those who at the discretion of the management may be allowed to stay in the premises.

(4)    Audit of income. — The books of accounts of the franchise holder, as well as all financial records and other supporting documents, shall be subject to audit by the Commission on Audit or his duly authorized representative.

(5)    Operation of related services. — The franchise holder is authorized to operate such necessary and related services, shows and entertainment. Any income that may be realized from these related services shall not be included as part of the gross income of the franchise holder for the purpose of applying the franchise tax, but the same shall be considered as a separate income of the franchise holder and shall be subject to income tax.   aESTAI

(6)    Personnel. — No union or any form of association shall be formed by persons working as employees of the casinos, whether directly or indirectly. For such purpose, all employees of the casinos shall be classified as "confidential" appointees and their employment thereof, whether by the franchise holder, or the operators, or the managers, shall be exempt from the provisions of the Labor Code or any implementing rules and regulations thereof.

Section 6.    The conditions of this Franchise shall be subject at all times to the provisions of all existing laws or decrees.   HaSEcA

Section 7.    This Decree shall take effect immediately.

Done in the City of Manila, this 1st day of January, in the year of Our Lord, nineteen hundred and seventy-seven.

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