Presidential Decree No.

1602
(Simplifying and Providing Stiffer Penalties for Violations of Philippine Gambling
Laws)

Section 1. Violations and Penalties. The penalty of prision mayor in its medium
degree or a fine ranging from Five Hundred Pesos to Two Thousand Pesos and in case of
recidivism the penalty of prision correccional in its medium degree or a fine of ranging from
One Thousand Pesos to Six Thousand Pesos shall be imposed upon:

(a) Any person other than those referred to in the succeeding subsection who in any
manner, shall directly or indirectly take part in any game of cockfighting, jueteng, bookies
(jai- alai or horse racing to include game fixing) and other lotteries, cara y cruz or
pompiang and the like, black jack, lucky nine, pusoy or Russian Poker, monte, baccarat
and other card games, palk que, domino, mahjong, high and low, slot machines, roulette,
pinball and other mechanical inventories or devices, dog racing, boat racing, car raising
and other races, basketball, volleyball, boxing, seven-eleven dice games and the like and
other contests to include game fixing, point shaving and other machinations banking or
percentage game, or any other game or scheme, whether upon chance or skill, which do
not have a franchise from the national government, wherein wagers consisting of money,
articles of value of representative of value are made;

(b) Any person who shall knowingly permit any form of gambling referred to in the
preceding subdivision to be carried on in inhabited or uninhabited places or any building,
vessel or other means of transportation owned or controlled by him. If the place where
gambling is carried on has a reputation of a gambling place or that prohibited gambling is
frequently carried on therein or the place is a public or government building or barangay
hall, the culprit shall be punished by the penalty provided for in its maximum period and a
fine of Six Thousand Pesos.

The penalty of prision correccional in its maximum degree and a fine of Six
Thousand Pesos shall be imposed upon the maintainer, conductor of the above gambling
schemes.

The penalty of prision mayor in its medium degree and temporary absolute
disqualification and a fine of Six Thousand Pesos shall be imposed if the maintainer,
conductor or banker is a government official, or if a player, promoter, referee, umpire,
judge or coach in cases of game-fixing, point-shaving and other game machination.

The penalty of prision correccional in its medium degree and a fine ranging from
Five Hundred pesos to Two Thousand Pesos shall be imposed upon any person who shall
knowingly and without lawful purpose in any hour of any day shall have in his possession
any lottery list, paper, or other matter containing letter, figures, signs or symbols which
pertain to or in any manner used in the game of jueteng, jai-alai or horse racing bookies
and similar game or lottery which has taken place or about to take place.

Section 2. Barangay Official. Any barangay official in whose jurisdiction such

gambling house is found and which house has the reputation of a gambling place shall
suffer the penalty of prision correccional in its medium period and a fine ranging from Five
Hundred to Two Thousand Pesos and temporary absolute disqualifications.
 While the acts under the Revised Penal Code are still punished under the new law,
yet the concept of gambling under it has been changed by the new gambling law.

Before, the Revised Penal Code considered the skill of the player in classifying
whether a game is gambling or not. But under the new gambling law, the skill of the
players is immaterial.

Any game is considered gambling where there are bets or wagers placed with the
hope to win a prize therefrom.

Under this law, even sports contents like boxing, would be gambling insofar as
those who are betting therein are concerned. Under the old penal code, if the skill of the
player outweighs the chance or hazard involved in winning the game, the game is not
considered gambling but a sport. It was because of this that betting in boxing and
basketball games proliferated.

Unless authorized by a franchise, any form of gambling is illegal. So said the court
in the recent resolution of the case against the operation of jai-alai.

There are so-called parlor games which have been exempted from the operation of
the decree like when the games are played during a wake to keep the mourners awake at
night. Pursuant to a memorandum circular issued by the Executive Branch, the offshoot of
the exemption is the intentional prolonging of the wake of the dead by gambling lords.

As a general rule, betting or wagering determines whether a game is gambling or

not. Exceptions: These are games which are expressly prohibited even without bets.
Monte, jueteng or any form of lottery; dog races; slot machines; these are habit-forming
and addictive to players, bringing about the pernicious effects to the family and economic
life of the players.

Mere possession of lottery tickets or lottery lists is a crime punished also as part of
gambling. However, it is necessary to make a distinction whether a ticket or list refers to a
past date or to a future date.

Illustration:

X was accused one night and found in his possession was a list of jueteng. If the date
therein refers to the past, X cannot be convicted of gambling or illegal possession of lottery
list without proving that such game was indeed played on the date stated. Mere
possession is not enough. If the date refers to the future, X can be convicted by the mere
possession with intent to use. This will already bring about criminal liability and there is no
need to prove that the game was played on the date stated. If the possessor was caught,
chances are he will not go on with it anymore.

There are two criteria as to when the lottery is in fact becomes a gambling game:
1. If the public is made to pay not only for the merchandise that he is buying, but
also for the chance to win a prize out of the lottery, lottery becomes a gambling game.
Public is made to pay a higher price.
 2. If the merchandise is not saleable because of its inferior quality, so that the public
actually does not buy them, but with the lottery the public starts patronizing such
merchandise. In effect, the public is paying for the lottery and not for the merchandise, and
therefore the lottery is a gambling game. Public is not made to pay a higher price.

Illustrations:

(1) A certain supermarket wanted to increase its sales and sponsored a lottery where
valuable prices are offered at stake. To defray the cost of the prices offered in the
lottery, the management increased their prices of the merchandise by 10 cents each.
Whenever someone buys from that supermarket, he pays 10 cents more for each
merchandise and for his purchase; he gets a coupon which is to be dropped at
designated drop boxes to be raffled on a certain period.

The increase of the price is to answer for the cost of the valuable prices that will be
covered at stake. The increase in the price is the consideration for the chance to win in
the lottery and that makes the lottery a gambling game.

But if the increase in prices of the articles or commodities was not general, but only on
certain items and the increase in prices is not the same, the fact that a lottery is
sponsored does not appear to be tied up with the increase in prices, therefore not
illegal.
Also, in case of manufacturers, you have to determine whether the increase in the
price was due to the lottery or brought about by the normal price increase. If the
increase in price is brought about by the normal price increase [economic factor] that
even without the lottery the price would be like that, there is no consideration in favor of
the lottery and the lottery would not amount to a gambling game.

If the increase in the price is due particularly to the lottery, then the lottery is a
gambling game. And the sponsors thereof may be prosecuted for illegal gambling
under Presidential Decree No. 1602.
(2) The merchandise is not really saleable because of its inferior quality. A certain
manufacturer, Bhey Company, manufacture cigarettes which is not saleable because
the same is irritating to the throat, sponsored a lottery and a coupon is inserted in every
pack of cigarette so that one who buys it shall have a chance to participate. Due to the
coupons, the public started buying the cigarette. Although there was no price increase
in the cigarettes, the lottery can be considered a gambling game because the buyers
were really after the coupons not the low quality cigarettes.

If without the lottery or raffle, the public does not patronize the product and starts to
patronize them only after the lottery or raffle, in effect the public is paying for the price
not the product.

Under this decree, a barangay captain who is responsible for the existence of gambling
dens in their own locality will be held liable and disqualified from office if he fails to
prosecute these gamblers. But this is not being implemented.

Gambling, of course, is legal when authorized by law.

Fund-raising campaigns are not gambling. They are for charitable purposes but they have
to obtain a permit from Department of Social Welfare and Development. This includes
concerts for causes, Christmas caroling, and the like.