More than 60 percent of licensed Philippine online gaming system administrators were operating below the country’s new minimum revenue benchmarks based on second-quarter run rates, according to Arden Consult.
The finding was included in a legal guide released by the Philippine legal and regulatory advisory firm on Thursday, suggesting that the minimum guaranteed fee (MGF) introduced by the Philippine Amusement and Gaming Corporation (PAGCOR) could accelerate consolidation among smaller operators.
Arden Consult’s proprietary data also estimated Philippine online gross gaming revenue at approximately $1.19 billion in the first half of 2026, down 31 percent year-on-year.
Marie Antonette “Tonet” Quiogue, founder and CEO of Arden Consult, described the MGF as a ‘market-selection mechanism’ rather than simply an additional regulatory charge.
‘In practical terms, it is part of the regulator’s clean-up: weaker or non-operational holders must recapitalize, consolidate, pursue an approved transaction, or exit,’ Quiogue wrote.
‘The Philippine market is not becoming less relevant to foreign capital; it is becoming more selective about the capital it will accept.’
The first phase of the MGF took effect on July 1st and runs until the end of 2026.
A Gaming System Administrator (GSA) offering electronic casino games must pay the higher of PAGCOR’s percentage-based regulatory fee or PHP9 million ($147,000) per month, based on a minimum monthly GGR benchmark of PHP30 million ($489,000).
GSAs without electronic casino games face a monthly minimum of PHP3 million ($49,000), based on a PHP15 million ($245,000) revenue benchmark.
The requirements will increase again on January 1st, 2027. The electronic casino benchmark will rise to PHP35 million ($571,000), with an MGF of PHP10.5 million ($171,000).
For operators without electronic casino games, the benchmark will increase to PHP20 million ($326,000), with a PHP4 million ($65,000) minimum fee.
The fixed floor applies even when an operator’s actual revenue falls below the benchmark, increasing the cost of maintaining a dormant or consistently underperforming accreditation.
Market entry offers reach $15M
The pressure comes as Arden Consult reports a growing number of approaches from investors and intermediaries seeking entry into the regulated Philippine online gaming market.
According to Quiogue, existing accreditations are being marketed at prices ranging from $3 million to as much as $15 million, reflecting the scarcity created by PAGCOR’s moratorium on new GSA applications.
New applications have been held in abeyance since March 2024. Foreign investors seeking direct exposure to the domestic online gaming market must therefore generally invest in, acquire or enter into a commercial arrangement with an existing accredited operator.
However, Quiogue cautioned that the accreditation itself cannot be bought separately from the company holding it.
‘There is no such thing as buying a PAGCOR “license”,’ she wrote. ‘A Certificate of Accreditation for a GSA is a non-transferable privilege issued to a specific corporation or legal entity.’
Any acquisition, share subscription, merger or other change in ownership, beneficial ownership or control requires prior approval from the PAGCOR Board and a full probity review.
Arden said investors had also been approached with offers involving dormant companies, URLs or partnership structures under which a new party would finance and operate the business while the original shareholders remained its nominal owners.
Such arrangements could be treated as an undisclosed transfer of control, an unauthorized sublicense or an attempt to circumvent PAGCOR’s moratorium.
‘Do not structure first and disclose later,’ Quiogue wrote, adding that the ownership, control and operating arrangements presented to PAGCOR should match how the business will function in practice.
Buying an accredited company also means acquiring its regulatory and financial history. Potential liabilities could include unpaid PAGCOR fees, deductions from performance deposits, player balances, tax exposures, anti-money laundering findings, unapproved brands and contracts with unaccredited service providers.
Arden said investors should therefore consider whether waiting could offer a cleaner alternative to paying a scarcity premium for an existing operator and its historical liabilities.
‘The present scarcity is regulatory and may be temporary,’ Quiogue wrote.
PAGCOR has not indicated when or whether it will reopen GSA applications. However, Arden said the possibility should form part of investors’ market-entry assessments as the regulator reviews its existing operator roster and the effects of the new fee floor become clearer.
