Digiplus urges fair rules, warns of black market shift

Listed online gaming operator DigiPlus Interactive Corp. is staying the course despite mounting regulatory scrutiny — and it wants lawmakers to strike a fair middle ground before more players get pushed into the shadows.

“Operationally, we were not affected. It's the stock price that has been affected… We're still on target,” DigiPlus chairman Eusebio Tanco said during a media briefing on Friday.

Tanco said DigiPlus remains fully operational, with over 40 million registered users and plans to launch in Brazil by September, followed by an entry into South Africa.

However, even as the company moves forward, it is raising concerns about the risks of excessive regulation, particularly the potential for driving users to illegal operators.

“From a legitimate operation’s point of view like that of DigiPlus, the government can add a little bit more regulation, because if you over regulate the money it migrates to the illegal. There's a balance where you can regulate so that you can attract the illegal to apply for licenses to be legalized,” Tanco said.

“It will not go away. It will just shift from the legal to the illegal, or from the illegal to the legal. I think what we want, every one of us wants, is the legal will shift to the legal. I think that's the best,” he added. 

Tanco noted that regulated operations under the Philippine Amusement and Gaming Corp. currently generate around P150 billion in revenue. Bringing the rest of the unregulated market into the legal fold could add another P200 to P300 billion.

“You have 70 percent out there that is unregulated, that is unmonitored, mostly with no consumer protection. They don't play by the rules. Those are illegal,” he said.

Meanwhile, DigiPlus president Andy Tsui also voiced concerns about some of the proposed measures being floated, including a hike in the minimum top-up amount to P10,000, which he warned could backfire.

“Certainly there will be some impact, but we're still analyzing it. But one thing I want to highlight is this, if the amount of the minimum top is set too high, some of the players we are pushing to the black market,” Tsui said.

“Because black market operators don't follow any procedures, and they don't have eKYC, they don't have to comply with the minimum top up. So if the amount is set up too high, certainly it's not good for the industry, and also they will lose the revenue.”

He also warned that moves to block e-wallet access could simply lead users to find workarounds.

“The reason is that for convenience, if the entry is removed from the e-wallets, of course, the players will find other ways. They know the brand names. They will search for it. They will enter from Google. I think there's no significant difference if you enter from the e-wallet or elsewhere,” he said.

Last week, DigiPlus announced its plan to expand into South Africa, leveraging on the country's proposed Remote Gambling Bill, which would legalize more online gaming formats. The company said the plan complements its international growth strategy following its scheduled Brazil launch this September.