The Cagayan Freeport was established in the Philippines by the Cagayan Economic Zone Act of 1995. The Cagayan Economic Zone Authority (CEZA) is mandated to manage the development of the Freeport and is empowered to ‘operate, directly through license, joint venture or lease various tourism and gaming-related activities such as casinos, horse racing, dog racing, and all forms of gaming without having to pass through any national government agency, even the Philippine Amusement and Gaming Corporation (PAGCOR).’

The mandate gives CEZA the sole legal right to host and issue online gambling licences to offshore companies. This right to regulate its own gambling laws is now being questioned by Senator Jamby Madrigal, who champions rights for children and currently heads various foundations aimed at increasing awareness of disadvantaged street children. She believes that state-owned PAGCOR should control all gambling operations in the nation.

CEZA has defended its right to issue online gambling licences to offshore companies without PAGCOR approval. Last year CEZA made PHP110 million (US$ million), of which about 90% was gambling revenue. Port Irene in the freeport zone is becoming a hub for gaming activity. In 2008 CEZA is expected to have revenue of around PHP200 million (US$ million).

In Port Irene there are currently 195 rooms dedicated to gambling, with plans for an additional 400 this year alone. Future plans include a total of 800 rooms and 2 brick-and-mortar casino buildings. Online gambling for Filipinos is illegal and it is thought to be for this reason that there has been little opposition to gambling in Cagayan from the Church. CEZA is thought to be looking for investment for the provision of fibre-optic cables from Hong Kong and Taiwan to upgrade the quality of the Internet connection in Port Irene. (E-08.15.08)

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