Violation of Article 231 of the Revised Penal Code

Chapter Six
OTHER OFFENSES OR IRREGULARITIES BY PUBLIC OFFICERS

Art. 231. Open disobedience. — Any judicial or executive officer who shall

openly refuse to execute the judgment, decision or order of any superior
authority made within the scope of the jurisdiction of the latter and issued
with all the legal formalities, shall suffer the penalties of arresto mayor in
its medium period to prision correccional in its minimum period,
temporary special disqualification in its maximum period and a fine not
exceeding 1,000 pesos.
Signed on July 11, 1983

MALACAÑANG
Manila

PRESIDENTIAL DECREE NO. 1869

CONSOLIDATING AND AMENDING PRESIDENTIAL DECREE NOS. 1067-A, 1067-B,

1067-C, 1399 AND 1632, RELATIVE TO THE FRANCHISE AND POWERS OF THE
PHILIPPINE AMUSEMENT AND GAMING CORPORATION (PAGCOR).

WHEREAS, Presidential Decree No. 1067-A, 1067-B, 1067-C, 1399 and 1632, relative to the
Franchise and Powers of the Philippine Amusement and Gaming Corporation (PAGCOR),
were enacted to enable the Government to regulate and centralized thru an appropriate
institution all games of chance authorized by existing franchise or permitted by law;

WHEREAS, to facilitate the enforcement and application of the above-mentioned

Presidential Decrees, it is imperative to consolidate them into one statute;

WHEREAS, since its creation in 1977, PAGCOR has demonstrated its reliability as a source
of income for the Government, particularly for the funding of government infrastructure
projects, such that, as of December 1982, PAGCOR has generated gross revenue of P1.677
Billion, contributing P956 Million as the 60% share of the Government plus P83 Million in
the form of 5% franchise tax;

WHEREAS, PAGCOR’s operation has enabled the Government to identify the potential
sources of additional revenue, provided games of chances are strictly managed and made
subject to close scrutiny, regulation, supervision and control by the Government;

WHEREAS, to make it more dynamic and effective in its tasks, PAGCOR should now be
reorganized by (a) increasing the participation of the private sector in the subscription of the
authorized capital stock of PAGCOR and by adjusting the share of the Government in the
gross earning to 50%; provided, that the annual income of the Government is not less than
P150 Million and, if it is less, then the share of the Government shall be 60% of the gross
earnings; (b) providing for a settlement of the portion of the Government’s share that was
utilized for the stabilization of casino operations, and (c) providing for greater flexibility in
operation by limiting governmental audit only to the determination of the 5% franchise tax
and the Government’s share of 50% of the gross earnings;

WHEREAS, in order to make PAGCOR’s regulatory powers more effective, it is necessary

that businesses primarily engaged in gambling operations be affiliated with PAGCOR, and
become subject to its regulatory powers with respect to operation, capitalization and
organizational structure;

WHEREAS, under Presidential Decree No. 1416, as amended, the President of the
Philippines is authorized to reorganized the administrative structure of government offices:
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue
of the powers vested in me by the Constitution and by Presidential Decree No. 1416, as
amended, do hereby decree;

TITLE I – General Provisions

SECTION 1. Declaration of Policy. — It is hereby declared to be the policy of the State to

centralize and integrate all games of chance not heretofore authorized by existing franchises
or permitted by law in order to attain the following objectives:

(a) To centralize and integrate the right and authority to operate and conduct games of chance
into one corporate entity to be controlled, administered and supervised by the Government;

(b) To establish and operate clubs and casinos, for amusement and recreation, including
sports gaming pools (basketball, football, lotteries, etc.) and such other forms of amusement
and recreation including games of chance, which may be allowed by law within the territorial
jurisdiction of the Philippines and which will: (1) generate sources of additional revenue to
fund infrastructure and socio-civic projects, such as flood control programs, beautification,
sewerage and sewage projects, Tulungan ng Bayan Centers, Nutritional Programs, Population
Control and such other essential public services; (2) create recreation and integrated facilities
which will expand and improve the country’s existing tourist attractions; and (3) minimize, if
not totally eradicate, the evils, malpractices and corruptions that are normally prevalent in the
conduct and operation of gambling clubs and casinos without direct government involvement.

TITLE II – CREATION OF PHILIPPINE AMUSEMENT AND GAMING CORPORATION

SEC. 2. Philippine Amusement and Gaming Corporation (PAGCOR);

Creation and Purpose. — To implement State policy and pursue the objectives set forth in the
preceding SEC., there is hereby created a body corporate to be known as the Philippine
Amusement and Gaming Corporation, hereinafter referred to as the “Corporation”, which
shall have its principal office in Metropolitan Manila. The Corporation may establish such
offices, agencies, subsidiaries, or branches in the Philippines as its operations would require
and its Board of Directors may determine.

SEC. 3. Corporate Powers. — The Corporation shall have the following powers and
functions, among others:

a) to prescribe its By-Laws;

b) to adopt, alter and use a corporate seal;

c) to own real or personal property, and to sell, alienate, mortgage, encumber or otherwise
dispose of the same;

d) to make contracts, and to sue and be sued;

e) to employ such officers and personnel as may be necessary or proper to carry on its
business;
f) to acquire, lease or maintain, whether on land, water or air, personal property and such
other equipment and facilities as may be necessary or proper to carry out its purposes;

g) to import, buy, sell, or otherwise trade or deal in merchandise, goods, wares and objects of
all kinds and descriptions that may be necessary or proper to carry out the purposes for which
it has been created;

(h) to enter into, make, conclude, perform, and carry out contracts of every kind and nature
for any lawful purpose which are necessary, appropriate, proper or incidental to any business
or purpose of the PAGCOR, including but not limited to investment agreements, joint venture
agreements, management agreements, agency agreements, whether as principal or as an
agent, manpower supply agreements, or any other similar agreements or arrangements with
any person, firm, association or corporation.

i) to borrow money from local or foreign sources as may be necessary or proper for its
operations;

j) to invest its funds as the Corporation may deem necessary or proper in any activity related
to its principal operation, including in any bonds or securities issued or guaranteed by the
Government of the Philippines;

k) to perform such other powers and functions as may be provided by law; and

l) to do anything and everything necessary, proper, desirable, convenient or suitable for the
accomplishment of any of the purpose or the attainment of any of the objects or the
furtherance of any of the powers herein stated, either alone or in association with other
corporations, firms or individuals, and to do every other act or thing incidental, pertaining to,
growing out of, or connected with, the aforesaid purposes, objects or powers, or any part
thereof.

SEC. 4. Authorized Capital Stock. — The Corporation shall have an authorized capital stock
divided into one million voting and no par value shares, to be subscribed, paid for and voted
as follows:

a) 550,000 shares of stock to be subscribed to and paid for by the Government of the
Republic of the Philippines at an original issue value of P200.00 per share; and

b) 450,000 shares remaining may be subscribed to by persons or entities acceptable to the

Board of Directors at issue value to be determined by such Board of Directors.

The voting power pertaining to shares of stock subscribed to by the Government of the
Republic of the Philippines shall be vested in the President of the Philippines or in such
person or persons as he may designate.

The voting power pertaining to shares of stock subscribed by private persons or entities shall
be vested in them.

SEC. 5. Government Investment. — The Government advances to the Corporation authorized

on May 29, 1978, having reached the amount of P70,430,725.03, shall be converted into
equity as part of the investment of the Government to be applied to the subscription of
550,000 shares.

SEC. 6. Board of Directors. — The Corporation shall be governed and its activities be
directed, controlled and managed by a Board of Directors, hereinafter referred to as the
Board, composed of five (5) members, three (3) of whom shall come from the Government
sector and shall be appointed by the President, while the other two (2) shall be from the
private sector, who own at least 1 share of stock in the Corporation and who shall be elected
by the stockholders of the corporation in the annual general meeting or in a special meeting
called for such purpose.

Each Director shall serve for a term of one (1) year and until his successor shall have been
duly appointed and qualified.

SEC. 7. Powers, Functions and Duties of the Board of Directors. — The Board shall have the
following powers, functions and duties;

a) To allocate and distribute, with the approval of the Office of the President of the
Philippines, the earnings of the Corporation earmarked to finance infrastructure and socio-
civic projects;

b) To designate the commercial bank that shall act as the depository bank of the Corporation
and/or trustee of the funds of the Corporation;

c) To prepare and approve at the beginning of each calendar year the budget that may be
necessary under any franchise granted to it, to insure the smooth operation of the
Corporation; and to evaluate and approve budgets submitted to it by other corporations or
entities with which it might have any existing contractual arrangement;

d) To submit to the Office of the President of the Philippines before the end of February of
each year a list of all the infrastructure and/or socio-civic projects that might have been
financed from the Corporation’s earnings, and to submit such periodic or other reports as may
be required of it from time to time; and

e) To perform such other powers, functions and duties as may be directed and authorized by
the President of the Philippines or as may be necessary or proper for the accomplishment of
its purposes and objectives.

TITLE III – AFFILIATION PROVISIONS

SEC. 8. REGISTRATION. — All persons primarily engaged in gambling, together with their
allied business, with contract or franchise from the Corporation, shall register and affiliate
their businesses with the Corporation. The Corporation shall issue the corresponding
certificates of affiliation upon compliance by the registering entity with the promulgated rules
and regulations thereon.

SEC. 9. REGULATORY POWER. — The Corporation shall maintain a Registry of the

affiliated entities, and shall exercise all the powers, authority and the responsibilities vested
in the Securities and Exchange Commission over such affiliated entities mentioned under the
preceding SEC., including but not limited to amendments of Articles of Incorporation and
By-Laws, changes in corporate term, structure, capitalization and other matters concerning
the operation of the affiliating entities, the provisions of the Corporation Code of the
Philippines to the contrary notwithstanding, except only with respect to original
incorporation.

TITLE IV – GRANT OF FRANCHISE

SEC. 10. Nature and Term of Franchise. — Subject to the terms and conditions established in
this Decree, the Corporation is hereby granted from the expiration of its original term on July
11, 2008, another period of twenty-five (25) years, renewable for another twenty-five years,
the rights, privileges and authority to operate and license gambling casinos, gaming clubs and
other similar recreation or amusement places, gaming pools, i.e. basketball, football, bingo,
etc. except jai-alai, whether on land or sea, within the territorial jurisdiction of the Republic
of the Philippines.

SEC. 11. Scope of Franchise. — In addition to the rights and privileges granted it under the
preceding SEC., this Franchise shall entitle the Corporation to do and undertake the
following:

(1) Enter into operating or management contracts with any registered and accredited company
or qualified person possessing the knowledge, skill, expertise and facilities to ensure the
efficient operation of gambling casinos: provided, that the service fees of such management
and/or operator companies whose services may be retained by the Constitution shall not in
the aggregate exceed ten (10%) percent of the gross income;

(2) Purchase foreign exchange that may be required for the importation of equipment,
facilities and other gambling paraphernalia indispensably needed or useful to insure the
successful operation of gambling casinos;

(3) Acquire the right of way or access to or thru public land, public waters or harbors,
including the Manila Bay Area; such right shall include but not be limited to the right to lease
and/or purchase public lands, government reclaimed lands, as well as lands of private
ownership or those leased from the Government. This right shall carry with it the privilege of
the Corporation to utilize piers, quays, boat landings, and such other pertinent and related
facilities within these specified areas for use as landing, anchoring or berthing sites in
connection with its authorized casino operations;

(4) Build or construct structures, buildings castways, piers, decks, as well as any other form
of landing and boarding facilities for its floating casinos; and

(5) To do and perform such other acts directly related to the efficient and successful operation
and conduct of games of chance in accordance with existing laws and decrees.

SEC. 12. Special Condition of Franchise. — After deducting five (5%) percent as Franchise
Tax, the fifty (50%) percent share of the government in the aggregate gross earnings of the
Corporation from this Franchise, shall immediately be set aside and allocated to fund the
following infrastructure and socio-economic projects within the Metropolitan Area:
(a) Flood Control

(b) Sewerage and Sewage

(c) Nutritional Control

(d) Population Control

(e) Tulungan ng Bayan Centers

(f) Beautification

(g) Kilusang Kabuhayan at Kaunlaran (KKK) projects; provided, that should the aggregate
gross earnings be less than ₱150,000,000.00, the amount to be allocated to fund the above-
mentioned project shall be equivalent to sixty (60%) percent of the aggregate gross earnings.

In addition to the priority infrastructure and socio-civic projects within the Metropolitan
Manila specifically enumerated above, the share of the Government in the aggregate may also
be appropriated and allocated to fund and finance infrastructure and/or socio-civic projects
throughout the Philippines as may be directed and authorized by the Office of the President
of the Philippines.

SEC. 13. Exemptions. —

(1) Customs duties, taxes and other imposts on importations. — All importations of

equipment, vehicles, automobiles, boats, ships, barges, aircraft and such other gambling
paraphernalia, including accessories or related facilities, for the sole and exclusive use of the
casinos, the proper and efficient management and administration thereof, and such other
clubs, recreation or amusement places to be established under and by virtue of this Franchise
shall be exempt from the payment of all kinds of customs duties, taxes and other imposts,
including all kinds of fees, levies, or charges of any kind or nature, whether National or
Local.

Vessels and/or accessory ferry boats imported or to be imported by any corporation having
existing contractual arrangements with the Corporation, for the sole and exclusive use of the
casino or to be used to service the operations and requirements of the casino, shall likewise
be totally exempt from the payment of all customs duties, taxes and other imposts, including
all kinds of fees, levies, assessments or charges of any kind or nature, whether National or
Local.

(2) Income and other taxes. — (a) Franchise Holder: No tax of any kind or form, income or
otherwise, as well as fees, charges or levies of whatever nature, whether National or Local,
shall be assessed and collected under this Franchise from the Corporation; nor shall any form
of tax or charge attach in any way to the earnings of the Corporation, except a Franchise Tax
of five (5%) percent of the gross revenue or earnings derived by the Corporation from its
operation under this Franchise. Such tax shall be due and payable quarterly to the National
Government and shall be in lieu of all kinds of taxes, levies, fees or assessments of any kind,
nature or description, levied, established or collected by any municipal, provincial, or
national government authority.
(b) Others: The exemptions herein granted for earnings derived from the operations
conducted under the franchise specifically from the payment of any tax, income or otherwise,
as well as any form of charges, fees or levies, shall inure to the benefit of and extend to
corporation(s), association(s), agency(ies), or individual(s) with whom the Corporation or
operator has any contractual relationship in connection with the operations of the casino(s)
authorized to be conducted under this Franchise and to those receiving compensation or other
remuneration from the Corporation or operator as a result of essential facilities furnished
and/or technical services rendered to the Corporation or operator.

The fee or remuneration of foreign entertainers contracted by the Corporation or operator in

pursuance of this provision shall be free of any tax.

(3) Dividend Incomes — Notwithstanding any provision of law to the contrary, in the event
the Corporation should declare a cash dividend, that portion of the dividend income
corresponding to the participation of the private sector shall, as an incentive to the
beneficiaries, be subject only to a final income tax rate of ten (10%) percent in lieu of the
regular income tax rates. The dividend income shall not in such case be considered as part of
beneficiaries’ taxable income; provided, however, that such dividend income shall be totally
exempted from income or other forms of taxes if invested within six (6) months from the date
the dividend income is received, in the following:

(a) operation of the casino(s) or investments in any affiliate activity that will ultimately
redound to the benefit of the Corporation or any other corporation with whom the
Corporation has any existing arrangements in connection with or related to the operations of
the casino(s);

(b) Government bonds, securities, treasury notes, or debentures; or

(c) BOI-registered or export-oriented corporation(s).

(4) Utilization of Foreign Currencies. — The Corporation shall have the right and authority,
solely and exclusively in connection with the operations of the casino(s), to purchase, receive,
exchange and disburse foreign exchange, subject to the following terms and conditions:

(a) A specific area in the casino(s) or gaming pit shall be put up solely exclusively for players
and patrons utilizing foreign currencies;

(b) The Corporation shall appoint and designate a duly accredited commercial bank agent of
the Central Bank, to handle, administrative and manage the use of foreign currencies in the
casino(s);

(c) The Corporation shall provide an office at casino(s) exclusively for the employees of the
designated bank, agent of the Central Bank, where the Corporation shall maintain a dollar
account which will be utilized exclusively for the above purpose and the casino dollar
treasury employees;

(d) Only persons with foreign passports or certificates of identity (for Hong Kong patron
only) duly issued by the government or country of their residence will be allowed to play in
the foreign exchange gaming pit;
(e) Only foreign exchange prescribe to form part of the Philippine International Reserve and
the following foreign exchange currencies: Australian Dollar, Singapore Dollar, Hong Kong
Dollar, shall be used in this gaming pit;

(f) The disbursement, administration, management and recording of foreign exchange

currencies used in the casino(s) shall be carried out in accordance with existing foreign
exchange regulations; and periodical reports of the transactions in such foreign exchange
currencies by the Corporation shall be duly recorded and reported to the Central Bank thru
the designated Agent Bank; and

(g) The Corporation shall issue the necessary rules and regulations for the guidance and
information of players qualified to participate in the foreign exchange gaming pit, in order to
make certain that the terms and conditions as above set forth are strictly complied with.

SEC. 14. Other Conditions. —

(1) Place — The Corporation shall conduct the gambling activities or games of chance on
land or water within the territorial jurisdiction of the Republic of the Philippines. When
conducted on water, the Corporation shall have the right to dock the floating casino(s) in any
part of the Philippines where vessels/boats are authorized to dock under the Customs and
Maritime Laws.

(2) Time — Gambling activities may be held and conducted at anytime of the day or
night; provided, however, that in the places where curfew hours are observe, all players and
personnel of the gambling casinos shall remain within the premises of the casinos.

(3) Persons allowed to play —

(a) Tourist and/or foreigners who are not residents of the Philippines;

(b) Residents with a gross income for the previous year of at least P50,000.00, which fact
shall be certified to by the Bureau of Internal Revenue; and

(c) The number of guests of the above-mentioned qualified persons shall be limited to two (2)
only; provided, that the said guests are at least 21 years of age;

(4) Persons not allowed to play —

(a) Government officials connected directly with the operation of the Government or
any of its agencies;

(b) Members of the Armed Forces of the Philippines, including the Army, Navy, Air
Force or Constabulary; and

(c) Persons under 21 years of age or students of any school, college or university in the
Philippines.

From these are excepted the personnel employed by the casinos, special guests, or those who
at the discretion of the Management may be allowed to stay in the premises.
(5) Operation of related services — The Corporation is authorized to operate such necessary
and related services, shows and entertainment. Any income that may be realized from these
related services shall not be included as part of the income of the Corporation for the purpose
of applying the franchise tax, but the same shall be considered as a separate income of the
Corporation and shall be subject to income tax.

TITLE V – GOVERNMENT AUDIT

SEC. 15. Auditor — The Commission of Audit or any government agency that the Office of
the President may designate shall appoint a representative who shall be the Auditor of the
Corporation and such personnel as may be necessary to assist said representative in the
performance of his duties. The salaries of the Auditor or representative and his staff shall be
fixed by the Chairman of the Commission on Audit or designated government agency, with
the advice of the Board, and said salaries and other expenses shall be paid by the Corporation.
The funds of the Corporation to be covered by the audit shall be limited to the 5% franchise
tax and the 50% of the gross earnings pertaining to the Government as its share.

TITLE VI – EXEMPTION FROM CIVIL SERVICE LAW

SEC. 16. Exemption — All position in the Corporation, whether technical, administrative,

professional, or managerial are exempt from the provisions of the Civil Service Law, rules
and regulations, and shall be governed only by the personnel management policies set by the
Board of Directors. All employees of the casinos and related services shall be classified as
“Confidential” appointee.

TITLE VII – TRANSITORY PROVISIONS

SEC. 17. Transitory Provisions — The properties, monies, assets, rights, choses in action,
obligations, liabilities, records and contracts of the Philippine Amusement and Gaming
Corporation (PAGCOR) under Presidential Decree Nos. 1067-A, 1067-B, 1067-C, 1399 and
1632 shall continue to be vested in and assumed by the Corporation, pursuant to this Decree.

Likewise, all personnel of PAGCOR under the above-mentioned Decree shall be absorbed by
the Corporation under this Decree and shall remain in their respective positions without
demotion in rank or reduction in salary: provided, that employees who shall be separated
from the Corporation shall be given at least one month gratuity for every full year of service,
a fraction of over six months being considered a full year, but in no case more than twenty-
four months salary, in addition to all benefits to which they may be entitled under existing
laws, rules and regulations.

SEC. 18. Exemption From Labor Laws — No union or any form of association shall be
formed by all those working as employees of the casino or related services whether directly
or indirectly. For such purpose, all employees of the casinos or related services shall be
classified as “confidential” appointees and their employment thereof, whether by the
franchise holder, or the operators, or the managers, shall be exempt from the provisions of the
Labor Code or any implementing rules and regulations thereof.

TITLE VIII – REPEALING AND EFFECTIVITY CLAUSES

SEC. 19. Repealing Clause — All laws, decrees, executive, orders, administrative orders,
rules or regulations, inconsistent herewith are hereby repealed, amended or modified
accordingly.

SEC. 20. Effectivity — This Decree shall take effect immediately.

DONE in the City of Manila, this 11th day of July in the year of Our Lord, nineteen hundred
and eighty-three.

(SGD.) FERDINAND E. MARCOS

President of the Philippines

By the President:
(SGD.) JUAN C. TUVERA
Presidential Executive Assistant

MALACAÑANG
Manila

PRESIDENTIAL DECREE No. 1602

PRESCRIBING STIFFER PENALTIES ON ILLEGAL GAMBLING

WHEREAS, Philippine Gambling Laws such as Articles 195-199 of the

Revised Penal Code (Forms of Gambling and Betting), R.A. 3063 (Horse
racing Bookies), P.D. 449 (Cockfighting), P.D. 483 (Game Fixing), P.D.
510 (Slot Machines) in relation to Opinion Nos. 33 and 97 of the Ministry
of Justice, P.D. 1306 (Jai-Alai Bookies) and other City and Municipal
Ordinances or gambling all over the country prescribe penalties which are
inadequate to discourage or stamp out this pernicious activities;

WHEREAS, there is now a need to increase their penalties to make them

more effective in combating this social menace which dissipate the energy
and resources of our people;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Republic

of the Philippines, by virtue of the powers vested in me by the
Constitution, do hereby order and decree:

Section 1. Penalties. The following penalties are hereby imposed:

(a) The penalty of prison correccional in its medium period of a fine

ranging from one thousand to six thousand pesos, and in case of
recidivism, the penalty of prision mayor in its medium period or a fine
ranging from five thousand to ten thousand pesos shall be imposed upon:

1. Any person other than those referred to in the succeeding sub-sections

who in any manner, shall directly or indirectly take part in any illegal or
unauthorized activities or games of cockfighting, jueteng, jai alai or horse
racing to include bookie operations and game fixing, numbers, bingo and
other forms of lotteries; cara y cruz, pompiang and the like; 7-11 and any
game using dice; black jack, lucky nine, poker and its derivatives, monte,
baccarat, cuajao, pangguingue and other card games; paik que, high and
low, mahjong, domino and other games using plastic tiles and the likes;
slot machines, roulette, pinball and other mechanical contraptions and
devices; dog racing, boat racing, car racing and other forms of races,
basketball, boxing, volleyball, bowling, pingpong and other forms of
individual or team contests to include game fixing, point shaving and
other machinations; banking or percentage game, or any other game
scheme, whether upon chance or skill, wherein wagers consisting of
money, articles of value or representative of value are at stake or made;

2. Any person who shall knowingly permit any form of gambling referred
to in the preceding subparagraph to be carried on in inhabited or
uninhabited place or in 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 malfactor shall be punished by
prision correccional in its maximum period and a fine of six thousand
pesos.

(b) The penalty of prision correccional in its maximum period or a fine of

six thousand pesos shall be imposed upon the maintainer or conductor of
the above gambling schemes.

(c) The penalty of prision mayor in its medium period with temporary
absolute disqualification or a fine of six thousand pesos shall be imposed
if the maintainer, conductor or banker of said gambling schemes is a
government official, or where such government official is the player,
promoter, referee, umpire, judge or coach in case of game fixing, point
shaving and machination.
(d) The penalty of prision correccional in its medium period or a fine
ranging from four hundred to two thousand pesos shall be imposed upon
any person who shall, knowingly and without lawful purpose in any hour
of any day, possess any lottery list, paper or other matter containing
letters, figures, signs or symbols pertaining to or in any manner used in
the games of jueteng, jai-alai or horse racing bookies, and similar games
of lotteries and numbers which have taken place or about to take place.

(e) The penalty of temporary absolute disqualifications shall be imposed

upon any barangay official who, with knowledge of the existence of a
gambling house or place in his jurisdiction fails to abate the same or take
action in connection therewith.

(f) The penalty of prision correccional in its maximum period or a fine

ranging from five hundred pesos to two thousand pesos shall be imposed
upon any security officer, security guard, watchman, private or house
detective of hotels, villages, buildings, enclosures and the like which have
the reputation of a gambling place or where gambling activities are being
held.

Section 2. Informer's reward. Any person who shall disclose information

that will lead to the arrest and final conviction of the malfactor shall be
rewarded twenty percent of the cash money or articles of value
confiscated or forfeited in favor of the government.

Section 3. Repealing Clause. Provisions of Art. 195-199 of the Revised

Penal Code, as amended, Republic Act No. 3063, Presidential Decrees
Numbered 483, 449, 510 and 1306, letters of instructions, laws,
executive orders, rules and regulations, city and municipal ordinances
which are inconsistent with this Decree are hereby repealed.

Section 4. Effectivity. This Decree shall take effect immediately upon

publication at least once in a newspaper of general circulation.

Done in the City of Manila, this 11th day of June, in the year of Our Lord,
nineteen hundred and seventy-eight.
 EXECUTIVE ORDER NO. 226 February 17, 1995

INSTITUTIONALIZATION OF THE DOCTRINE OF "COMMAND

RESPONSIBILITY" IN ALL GOVERNMENT OFFICES, PARTICULARLY AT ALL
LEVELS OF COMMAND IN THE PHILIPPINE NATIONAL POLICE AND OTHER
LAW ENFORCEMENT AGENCIES.

WHEREAS, strict and effective management and control of an organization

by the supervisor is critical in ensuring responsive delivery of services by
the government, especially in police matters;

WHEREAS, a supervisor/commander is duty-bound and, as such, is

expected to closely monitor, supervise, direct, coordinate, and control the
overall activities of his subordinates within his area of jurisdiction, and
can be held administratively accountable for neglect of duty in taking
appropriate action to discipline his men;

WHEREAS, in order to ensure a more effective, sustained, and successful

campaign against erring government personnel, it is imperative that the
doctrine of "command responsibility" be institutionalized and strictly
applied in all government offices and at all levels of command in the PNP
and other law enforcement agencies.
NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the
Philippines, by virtue of the powers vested in me by law, do hereby order:

Sec. 1. Neglect of Duty Under the Doctrine of "Command Responsibility".

- Any government official or supervisor, or officer of the Philippine
National Police or that of any other law enforcement agency shall be held
accountable for "Neglect of Duty" under the doctrine of "command
responsibility" if he has knowledge that a crime or offense shall be
committed, is being committed, or has been committed by his
subordinates, or by others within his area of responsibility and, despite
such knowledge, he did not take preventive or corrective action either
before, during, or immediately after its commission.

Sec. 2. Presumption of Knowledge. - A government official or supervisor,

or PNP commander, is presumed to have knowledge of the commission of
irregularities or criminal offenses in any of the following circumstances:

a. When the irregularities or illegal acts are widespread within his area of
jurisdiction;

b. When the irregularities or illegal acts have been repeatedly or regularly

committed within his area of responsibility; or

c. When members of his immediate staff or office personnel are involved.

Sec. 3. Implementing Rules and Regulations. - The National Police

Commission (NAPOLCOM) in coordination with the Department of Interior
and Local Government (DILG) and the Civil Service Commission (CSC)
shall promulgate the necessary rules and regulations of this Executive
Order within thirty (30) days after the issuance thereof.

Sec. 4. Administrative Liability. - Any violation of this Executive Order by

any government official, supervisor, officer of the PNP and that of any law
enforcement agency shall be held administratively accountable for
violation of existing laws, rules and regulations.
Sec. 5. Effectivity. - This Executive Order shall take effect immediately.
lawphi1.net

Done in the City of Manila this 17th day of February, in the year of our
Lord, nineteen hundred and ninety-five.

Administrative offense of gambling

It must be emphasized that all individuals, whether government officials
or not, are prohibited by Philippine laws to engage in any form of illegal
gambling. The latest law related to illegal gambling is Republic Act (RA)
9287, entitled “An Act Increasing the Penalties for Illegal Numbers
Games, Amending Certain Provisions of Presidential Decree (PD) No.
1602, and for Other Purposes.” Thus, it is stated under Section 1 of the
law that, “[It] is the policy of the state to promote a just and dynamic
social order that will ensure the prosperity and independence of the
nation and free the people from poverty through policies that provide
adequate social services, promote full employment, a rising standard of
living, and an improved quality of life for all. It is, likewise, the policy of
the state that the promotion of social justice shall include the
commitment to create economic opportunities based on freedom of
initiative and self-reliance.” It then proceeded by stating, “The state
hereby condemns the existence of illegal gambling activities, such as
illegal numbers games, as this has become an influential factor in an
individual’s disregard for the value of dignified work, perseverance and
thrift since instant monetary gains from it are being equated to success,
thereby becoming a widespread social menace and a source of
corruption.”

PD 1602 enumerates the different Philippine gambling laws, such as

Articles 195 to 199 of the Revised Penal Code (Forms of Gambling and
Betting); RA 3063 (Horse Racing Bookies); PD 449 (Cockfighting); PD 483
(Game Fixing); PD 510 (Slot Machines) in relation to Opinion Nos. 33 and
97 of the Ministry of Justice; PD 1306 (Jai-Alai Bookies); and other city
and municipal ordinances for gambling all over the country.

The liability, therefore, of a government official engaged in illegal

gambling is both criminal and administrative.

As to the criminal liability of a government official engaged in illegal

gambling, Section 3 of RA 9287 prescribes the penalty of imprisonment
from 30 days to 90 days, if such person acts as a bettor. Section 5
imposes the stiffer penalty of 12 years and one day to 20 years and a fine
ranging from P3 million to P5 million and perpetual absolute
disqualification from public office for government employees and public
officials if such public official acts as ”collector, agent, coordinator,
controller, supervisor, maintainer, manager, operator, financier or
capitalist of any illegal-numbers game.”

The Revised Rules on Administrative Cases in the Civil Service (RRACCS)

promulgated on November 8, 2011, classifies the act of “gambling
prohibited by law” as a light offense punishable by “reprimand for the first
offense; suspension of one to 30 days for the second offense; and
dismissal from the service for the third offense.” While the RRACCS does
not state whether such penalty applies only if the public official is a
bettor, it is submitted that a public official who acts as a “collector, agent,
coordinator, controller, supervisor, maintainer, manager, operator,
financier or capitalist” of any illegal gambling should be held
administratively liable for the grave offense of “grave misconduct” and not
simply the light offense of “gambling prohibited by law.”

In light of the foregoing, the public official who engage in a “friendly

P5,000 bet” in any basketball game or boxing match may be held
criminally and administratively liable. So how about playing tong-its or
other card games without a monetary bet in office? While this may not be
considered as “illegal gambling” under existing penal laws or “gambling
prohibited by law” punishable as a light offense under RRACCS, such
government official should be held, at the very least, for misconduct.
Thus, in an administrative case filed against a court employee merely
playing cards in the judge’s chambers or in his office, the disclaimer that
money was not involved is declared to be inconsequential. The Supreme
Court in said case stated that “[i]n fact, their defense that they were
simply having an innocuous card game sans monetary bets does not
excuse their misconduct.” It then quoted Albano-Madrid v Apolonio (A.M.
No. P—1-1517, February 17, 2003) as follows: “What is more alarming,
in our view, is respondents’ nonchalance concerning the effect of their
misconduct. They have the gall to split hairs and say that they were
playing cards, but not gambling. If loafing during office hours could not be
countenanced, the more reason playing cards could not be tolerated in
the judge’s chambers. Such act or conduct that violates the norm of
public accountability or diminishes the people’s faith in the judiciary could
never be tolerated or condoned.”

While this case speaks about a court employee playing cards in the
judge’s chambers or in his office, playing tong-its or other card games
without a monetary bet in office should have the same effect of violating
the norm of public accountability expected from all government officials
and employees (or of diminishing the people’s faith in the government
service). Incidentally, may I reiterate to our readers that Memorandum
Circular 8, issued by Malacañang on August 28, 2001, enjoins all
government personnel from entering or playing in casinos. This column
should not be taken as a legal advice applicable to any case as each case
is unique and should be construed in light of the attending circumstances
surrounding such particular case.

Lawyer Toni Umali is the current assistant secretary for Legal and
Legislative Affairs of the Department of Education. He is licensed to
practice law not only in the Philippines, but also in the state of California
and some federal courts in the US after passing the California State Bar
Examinations in 2004. He has served as a legal consultant to several
legislators and local chief executives. As education assistant secretary, he
was instrumental in the passage of the K to 12 law and the issuance of its
implementing rules and regulations. He is also the alternate spokesman of
the DepEd.