Listed gaming company PhilWeb Corp. has clarified that its chairman, Roberto Ongpin, resigned to protect the company from closure.
Ongpin, who was publicly singled out by President Rodrigo Duterte in a tirade against “oligarchs” last week, was earlier announced as leaving PhilWeb to focus on his property company, Alphaland Corp.
“The main reason why Mr. Ongpin resigned from PhilWeb is to save the company. He recognized that if he stayed on, PhilWeb’s e-Games outlets could be shut down, which would lead to the loss of its business and eventual closure, affecting more than 5,000 employees,” PhilWeb President Dennis Valdes said in a statement.
Duterte had said Ongpin was an example of an oligarch who had taken advantage of connections within the government to serve his own business interests.
The President has vowed to eliminate online gaming, which he deemed as internet-based gambling.
Valdes stressed that PhilWeb has licenses from the Philippine Amusement and Gaming Corp. (Pagcor), the state gaming regulator and operator, to operate 286 “Pagcor e-Games” cafes nationwide.
Its operations are not in the nature of online gaming, which are usually accessed by an office or home computer, he pointed out.
“Pagcor e-Games is not online gaming. It is a private, members-only network of clubs where players need to be physically present in order to play. Access to these clubs is strictly controlled such that it is only open to members who are over 21 years old and are financially capable of gaming,” the PhilWeb president said.
He said each Pagcor e-Games site conforms to location restrictions set by both Pagcor and the local government unit in which it is based.
Earlier, Pagcor revoked 124 online gaming licenses to enforce President Duterte’s order to stop internet-based gambling operations.
Valdes warned that canceling PhilWeb’s contract would lead to its immediate inoperability as well as losses to the government.
The losses to Pagcor was estimated at P6 million per day or P2.1 billion yearly, which was the government’s share from PhilWeb’s e-Games revenues last year, Valdes said.
Shutting down e-Games will also mean a P280-million loss to the Bureau of Internal Revenue, which represents PhilWeb’s corporate income tax, value-added tax and other taxes paid in 2015.
“The sudden closure of a publicly listed company may cause serious concerns to foreign investors,” Valdes said, noting that the company has more than 1,500 stockholders, some of which are foreign funds.
“There are enormous long-term economic and financial considerations that Mr. Ongpin took into consideration when he resigned from PhilWeb, which the government should also look at closely as it decides on the company’s fate,” Valdes said.
PhilWeb has been a service provider to Pagcor, managing the e-Games network, for the past 14 years. During this period, the company remitted more than P14 billion to Pagcor.