MANILA, Philippines?Senate President Juan Ponce Enrile is urging the Philippine Amusement and Gaming Corp. (Pagcor) to review what he dubbed as a ?sweetheart deal? between the gaming monopoly and PhilWeb Corp. to operate online casino games in the country.
?I hope you will find a way to better the share of the government because I think this is a sweetheart deal,? Enrile told Pagcor Chair Cristino L. Naguiat Jr. during the Senate finance committee hearing on government-owned and -controlled corporations.
But PhilWeb president Dennis Valdes, in a statement, disputed Enrile?s charges claiming the lawmaker was ?misinformed.?
?If anything, it is a sweetheart deal for Pagcor,? said Valdes noting that its deal to run Internet Casino Stations (ICS) with Pagcor has been the most profitable contract (excluding the traditional casinos) with any private sector since it was signed in 2004.
?Over the life of the contract, PhilWeb has remitted to Pagcor over P2.3 billion, and the remittance for 2009 alone totaled P1.1 billion.?
Bigger slice
Naguiat said that Pagcor would get P1.3 billion from PhilWeb (Valdes said it was P1.5 billion) this year as part of its 60-40 profit sharing arrangement with PhilWeb. Pagcor gets the bigger slice.
Enrile questioned why the deal between Pagcor and PhilWeb did not go through a public bidding and why the company owned by former Trade Minister Roberto Ongpin was ?so special? that former Pagcor Chair Efraim Genuino gave it a contract to online casinos coterminous with the franchise of Pagcor which would end in 2033.
?We share the same sentiment your honor,? replied Naguiat when Enrile asked why Ongpin was favored over other people.
Pagcor apparently picked PhilWeb because of its proprietary software used in running the online casinos, but Enrile said Pagcor could have easily created or bought its own software and ran the business on its own. Enrile said: ?How lucky can Ongpin be.?
But Valdes stressed that Pagcor was the lucky party in the agreement as it made ?no capital expenditures or operating expenses with regard to the ICS, as PhilWeb underwrites all these costs.?
Valdes noted that Pagcor had more lopsided sharing arrangements with other operators such as bingo and poker where the gaming monopoly got only 20 percent of the profits.
Valdes also pointed out that the contract was exempted from the mandatory public bidding under Article XVI, Sec. 50 of the Procurement Reform Act which ?authorizes the procuring entity to accept the offer of the supplier immediately or after some negotiations when the subject of the contract are proprietary rights of a party.?
Getting back
Enrile explained that he had no grudge against his fellow Marcos Cabinet member (Enrile was Marcos? Defense Minister) and that he only wanted to get back at Ongpin for having treated PhilWeb?s former president, Alex Villamar, very badly.
?I don?t like his (Ongpin?s) attitude. He put in jail of the NBI (National Bureau of Investigation) Alex Villamar who was the one who put up PhilWeb?s business. He (Ongpin) had all of (Villamar?s) assets attached on the ground that he was stealing from the company. He took everything back including his (Villamar?s) several billion shares,? said Enrile in an interview after the hearing.
Valdes said there was no truth to the allegation that Ongpin harassed Villamar or that Villamar developed PhilWeb?s software.
?Villamar was president of PhilWeb from its inception in 2000 to May 2004. During his tenure, PhilWeb ran up a deficit of over P800 million, in large part due to his poor management. Worse, Villamar set up several personal companies on the side, keeping the revenues for himself and leaving the expenses with PhilWeb. Due to this dishonesty and his illegal use of company time, over P300 million in losses were incurred by PhilWeb,? said Valdes.
Valdes claimed Villamar was fired by Ongpin and several criminal and civil cases were immediately filed against him. He claimed that a settlement was reached between Ongpin and Villamar in 2010 with the help of Enrile who took him in his company, Philcomsat.
