Philippines Warns Timor-Leste of Potential Risks

Philippine officials have sounded the alarm as POGOs eye Timor-Leste as their potential new base of operations. Following the POGO ban in the Philippines, the offshore gaming industry seeks new opportunities, posing fresh challenges. With concerns over socioeconomic impacts and security risks, Timor-Leste faces a critical decision on embracing or avoiding POGOs. Learn how this developing situation could shape the future of offshore gaming and affect the regulatory landscape in Asia.

Philippines Warns Timor-Leste of Risks as POGOs Eye New Destination Amid Ban

Officials in the Philippines have issued a stern warning to Timor-Leste about the potential influx of Philippine Offshore Gaming Operators (POGOs) into the island nation. The cautionary statement comes in the wake of President Ferdinand Marcos’ July ban on POGOs, a move driven by increasing concerns over criminal activities associated with the industry.

During his state visit on October 2, Philippine Justice Secretary Jesus Crispin Remulla directly advised Timor-Leste officials of the potential dangers of hosting former POGOs. The Department of Justice (DoJ) highlighted Timor-Leste as “one of the possible destinations where POGO operations could transfer.” Remulla emphasized the socioeconomic and security challenges that these operations might bring to the country, warning that they could jeopardize the island nation’s domestic stability.

The POGO Ban and the Fallout in the Philippines

In his state of the nation address in July, President Marcos officially banned POGOs amid reports of extensive illegal activities. The president condemned their operations as “disguised as legitimate entities,” but noted that they had ventured into “illicit areas furthest from gaming.” Among the alleged crimes were financial scamming, money laundering, prostitution, human trafficking, kidnapping, torture, and even murder.

The decision to ban POGOs was met with overwhelming support from lawmakers. Following the announcement, the Philippine Amusement and Gaming Corporation (Pagcor) was ordered to “wind down operations” by the end of 2024. Consequently, the Bureau of Immigration moved to downgrade the work visas of foreign POGO employees, instructing them to leave the country. So far, more than 3,000 foreign workers have already left, with the remaining workforce having until October 15 to voluntarily surrender their work papers.

Timor-Leste’s Aspiration to Become an Offshore Gaming Hub

Meanwhile, Timor-Leste has been positioning itself as the next major center for offshore gaming in the region. With the backing of President Jose Ramos-Horta, the country seeks to attract operators and become a new hub for the iGaming industry. The Virtual Gaming Association of Timor-Leste (VGA) is driving this initiative, urging the government to issue B2C and B2B licenses modeled after reputable jurisdictions like Malta and the Isle of Man.

VGA Chairman Richard Leather has emphasized that the association will enforce “best practices in online gambling regulation and licensing.” He added, “We look forward to speaking with responsible operators and suppliers looking for a serious, safe, and secure jurisdiction for their business.”

However, the Philippines’ recent experiences with POGOs serve as a cautionary tale. During his discussions with Timor-Leste officials, Secretary Remulla stressed the importance of examining the broader implications of welcoming POGO operations. He urged Timor-Leste to critically assess how such activities might affect the country’s domestic affairs, potentially mirroring the crime and social issues witnessed in the Philippines.

A Careful Approach to Gambling Regulation

Despite its openness to online gambling, Timor-Leste remains cautious about the implications of land-based casino operations. President Ramos-Horta has publicly expressed his opposition to land-based casinos targeting local residents. He clarified, “[Gambling] is not something that interests me unless it targets foreigners. I don’t want some poor Timorese to lose everything in gambling with all the human and sometimes tragic consequences. But if foreigners want to gamble online and Timor offers an online gambling possibility, fine.”

This stance aligns with the nation’s cautious approach to integrating gambling within its economy while protecting its citizens from the potential pitfalls associated with excessive gambling.

As POGOs seek new operational bases following their expulsion from the Philippines, Timor-Leste faces a pivotal decision. While the island nation aspires to become a key player in the offshore gaming market, it must weigh the potential socioeconomic and security risks associated with hosting POGOs. The warnings from Philippine officials serve as a reminder of the complexities and challenges that accompany the gambling industry’s rapid expansion. Timor-Leste’s next steps could shape its role in the Asian gaming landscape, setting an example for how emerging markets handle the balance between economic opportunity and responsible regulation.