In an effort to combat illegal gaming and boost the legitimate e-games sector, the Philippine Amusement and Gaming Corp. (Pagcor) has announced another reduction in its fee rates for electronic games.

In a statement, Alejandro H. Tengco, Pagcor chairman and chief executive officer, said fee rates for E-Games were reduced from 35 percent to 30 percent effective Jan. 1, 2025, in a bid to combat illegal gaming operations and foster industry growth.

Tengco said the move aims to incentivize unregistered online gaming operators to transition to the legal market and contribute to the regulated sector.

He added that the rate reduction is part of Pagcor’s ongoing efforts to create a more favorable regulatory environment.

"By lowering our share rates, Pagcor is creating a more favorable regulatory environment by encouraging unregistered online gaming operators to transition to the legal market,” Tengco said.

He added that rates for E-Games operated by integrated resorts were also reduced to 25 percent to compensate for overhead expenses incurred by brick-and-mortar operators.

The fee rates collected by Pagcor are based on a fixed percentage of the licensees' gross gaming revenues (GGR).

The government’s gaming regulator believes the lower rates will provide operators with more resources for marketing and help prevent closures, ensuring the sector's continued growth and profitability.

Tengco noted that the gradual reduction in rates, initiated in 2023, has already yielded positive results.

"In fact, the gradual reduction in rates enabled the E-Games sector to surpass, as early as last September, its P100 billion GGR target for the entire 2024," he said. Prior to these reductions, Pagcor was collecting fees of more than 50 percent of GGR, which deterred expansion.

The most recent reduction in share rates for E-Games prior to this month's change occurred in April 2024, when the rates were lowered to 35 percent.

"The gradual reduction of share rates has significantly contributed to the growth of the E-Games sector, which has become a key driver of the local gaming industry,” Tengco said.

This policy change has also led to a significant increase in the number of licensed E-Games operators, with many former gray market players opting to secure Pagcor licenses.

Currently, Pagcor has issued 1,188 licenses for various on-site and online gaming offerings, a 13.57 percent increase from the 1,046 licenses issued in 2023.

The number of accredited gaming service providers also increased significantly, from 49 in 2023 to 174 in 2024.

“We expect this trend to continue, and we are optimistic that the best is yet to come for the country’s E-Games sector,” Tengco added.