1/27/25, 2:52 PM Philippine Amusement and Gaming Corp. vs. Philippine Gaming Jurisdiction Inc.
Title
Philippine Amusement and Gaming Corp. vs. Philippine Gaming Jurisdiction Inc.
Case Decision Date
G.R. No. 177333 Apr 24, 2009
ZAMBOECOZONE Authority's power to regulate games of chance challenged by
PAGCOR; Supreme Court ruled Section 7(f) of R.A. No. 7903 does not authorize such
authority, emphasizing plain meaning of "games" and "amusements."
Jur.ph - Case Digest (G.R. No. 177333)
Legal Reasoning Model
Facts:
1. Creation of ZAMBOECOZONE Authority
Republic Act No. 7903 (R.A. No. 7903), enacted on February 23, 1995, created the
Zamboanga City Special Economic Zone (ZAMBOECOZONE) and the
ZAMBOECOZONE Authority. Section 7(f) of the law grants the ZAMBOECOZONE
Authority the power to operate or license tourism-related activities, including games,
amusements, and recreational and sports facilities.
2. Resolution No. 2006-08-03
On August 19, 2006, the ZAMBOECOZONE Authority passed Resolution No. 2006-08-03,
approving the application of private respondent Philippine E-Gaming Jurisdiction, Inc.
(PEJI) to act as a Master Licensor/Regulator of online/internet/electronic gaming and
games of chance.
3. PAGCOR's Petition for Prohibition
The Philippine Amusement and Gaming Corporation (PAGCOR) filed a petition for
Prohibition, challenging the authority of the ZAMBOECOZONE Authority to operate,
license, or regulate games of chance within the ZAMBOECOZONE. PAGCOR argued
that Section 7(f) of R.A. No. 7903 does not explicitly grant the ZAMBOECOZONE
Authority the power to regulate games of chance.
4. Comparison with Other Economic Zone Laws
PAGCOR cited three other statutes (R.A. No. 7227, R.A. No. 7922, and R.A. No. 7916) that
explicitly granted economic zones the authority to operate games of chance. PAGCOR
contended that the absence of such explicit language in R.A. No. 7903 means the
ZAMBOECOZONE Authority lacks the authority to regulate games of chance.
5. ZAMBOECOZONE Authority's Defense
The ZAMBOECOZONE Authority argued that the terms "games" and "amusements" in
Section 7(f) include "games of chance" and that PAGCOR failed to prove its exclusive
authority over such activities.
6. Opinion of the Office of the President
The Office of the President, through Deputy Executive Secretary Manuel B. Gaite, issued
an opinion stating that R.A. No. 7903 does not authorize the ZAMBOECOZONE Authority
to engage in gaming activities unless expressly allowed by law.
Issue:
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1/27/25, 2:52 PM Philippine Amusement and Gaming Corp. vs. Philippine Gaming Jurisdiction Inc.
1. Whether the ZAMBOECOZONE Authority has the authority under Section 7(f) of R.A.
No. 7903 to operate, license, or regulate games of chance within the ZAMBOECOZONE.
2. Whether PAGCOR has the exclusive authority to regulate games of chance in the
Philippines.
3. Whether the terms "games" and "amusements" in Section 7(f) of R.A. No. 7903 include
"games of chance."
Ruling:
The Supreme Court granted PAGCOR's petition. It ruled that Section 7(f) of R.A. No. 7903
does not authorize the ZAMBOECOZONE Authority to operate, license, or regulate games of
chance. The Court emphasized that the terms "games" and "amusements" do not include
"games of chance" or "gambling" based on their plain and ordinary meanings. The Court
also found persuasive the opinion of the Office of the President, which supported PAGCOR's
position.
The Court directed the ZAMBOECOZONE Authority to cease and desist from exercising
jurisdiction over games of chance and ordered PEJI to stop operating such games under the
license granted by the ZAMBOECOZONE Authority.
Ratio:
1. Plain Meaning Rule in Statutory Construction
The Court applied the plain meaning rule (verba legis), which holds that when the
words of a statute are clear and unambiguous, they must be given their literal meaning.
The terms "games" and "amusements" in Section 7(f) of R.A. No. 7903 do not include
"games of chance" or "gambling," as these terms have distinct legal meanings.
2. Comparison with Other Statutes
The Court compared R.A. No. 7903 with other economic zone laws (R.A. No. 7227, R.A.
No. 7922, and R.A. No. 7916) and noted that these laws explicitly granted the authority to
operate games of chance. The absence of such explicit language in R.A. No. 7903
indicates that the ZAMBOECOZONE Authority lacks such authority.
3. Doctrine of Respect for Administrative Construction
The Court gave weight to the opinion of the Office of the President, which interpreted
R.A. No. 7903 as not authorizing the ZAMBOECOZONE Authority to engage in gaming
activities. This interpretation is consistent with the doctrine of respect for
administrative or practical construction, which recognizes the expertise and informed
judgment of administrative agencies.
4. Legislative Intent
The Court found no evidence that the legislature intended to grant the
ZAMBOECOZONE Authority the power to regulate games of chance. The lawmakers
could have explicitly included such authority, as they did in other statutes, but they did
not.
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