CEZA Chief affirms no POGOs in Cagayan Special Economic Zone

Jenny Ortiz August 1, 2024

The Cagayan Economic Zone Authority (CEZA) has denied the presence of Philippine Offshore Gaming Operators (POGOs) within its jurisdiction. In a House of Representatives joint hearing on Wednesday, Katrina Ponce Enrile, CEZA Administrator and CEO, firmly stated, “There are no POGOs in the Cagayan Special Economic Zone and Freeport. There never was, and there never will be.”

Enrile’s statement comes after Philippine President Ferdinand Marcos Jr. banned all offshore gaming operations in the country as announced in his third State of the Nation Address (SONA) last week.

CEZA‘s oversight of offshore interactive gaming (iGaming) operations predates the establishment of POGOs by the Philippine Amusement and Gaming Corporation (PAGCOR) for more than a decade. Enrile highlighted CEZA’s pioneering role in this sector, noting, “CEZA established itself as the first interactive gaming jurisdiction in Asia and stood at the forefront of regulatory innovation.”

Enrile presented several key distinctions between CEZA’s regulation of iGaming and PAGCOR’s management of POGOs. Among them are the focus of CEZA solely on licensing and regulation, avoiding the conflict of interest inherent in PAGCOR’s dual role as regulator and operator; iGaming regulations have evolved over two decades, incorporating global best practices and advanced technology; issuance of its own working visas and monitors expatriates in coordination with the Bureau of Immigration (BI), maintaining a controlled workforce with a 70 percent Filipino and 30 percent expatriate ratio; operating its own data centre and internet service provider through collaborations, with master licensors investing $100 million (€923.5 million) each in the zone; and servicing providers do not accept bets, do not permit sub-licensing, and adhere to a “one-company, one-license” model, contrasting with PAGCOR’s more fragmented approach.

CEZA’s legislative defence

During the hearing, House Deputy Speaker Antonio Albano urged the Presidential Anti-Organized Crime Commission (PAOCC) to apologise for alleging the presence of POGOs near Enhanced Defence Cooperation Agreement (EDCA) sites. The Camilo Osias Naval Base in Sta. Ana, Cagayan, is approximately 7.8 kilometres from CEZA. Despite PAOCC’s lack of comment, spokesperson Winston Casio attributed the information to intelligence reports and Securities and Exchange Commission documents.

Protecting CEZA’s integrity

Chief Presidential Legal Counsel Juan Ponce Enrile, the author of the CEZA charter, joined his daughter in defending CEZA’s operations. He emphasised the strategic importance of CEZA, saying, ” There is a purpose for CEZA. Until today, that purpose is being pursued. That is the message I want to give.”

The younger Enrile reinforced this sentiment, highlighting CEZA’s adherence to its charter and regulatory integrity. “[CEZA] remains steadfast in its commitment to provide a sound regulatory framework anchored on fairness, honesty, transparency, integrity, and responsible conduct of interactive gaming.”

Optimism and development plans

In an interview with SiGMA News two months ago, CEZA’s Chief of Staff, Miguel Hernandez, and Chief of Business Processing and Regulation, Novy Cruz, shared insights on CEZA’s strategic initiatives to foster growth. Hernandez noted, “We are seeing a resurgence of interest in CEZA, with new licensees investing in infrastructure.”

CEZA is also planning to launch a blockchain-based online application system to enhance transparency and accountability in licensing processes. Cruz explained, “The purpose of using blockchain technology is for full transparency, ensuring there’s no way to alter the system.”