WHEREAS, it is now the desire of the government to fully
develop and exploit casino operations as a source of revenue to finance
important infra-structure and socio-civic projects;
WHEREAS, to achieve this goal, after the successful
experiment conducted in the Floating Casino, "PHILIPPINE TOURIST I" during the
year 1977, there is now the need to expand the areas of operations outside the
Metropolitan Manila Area;
WHEREAS, it is now the intention of the government to
allocate and appropriate revenues generated from this newly developed source to
fund priority infra-structure and/or socio-civic projects throughout the
Philippines, as may be directed and authorized by the Office of the
President;
WHEREAS, to attain this objective, certain amendments have
to be made to Presidential Decrees Nos. 1067-A and 1067-B;
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the
Philippines, by virtue of the powers vested in me by the Constitution, do hereby
order and decree the following:
SECTION l. Section 5 of Presidential Decree No. 1067-A dated
January 1, 1977, is hereby amended to read as follows:
"SECTION 5. Board of Directors. The Corporation
shall be governed and its activities be directed, controlled and managed by a
Board of Directors that shall be composed of five (5) members, namely: (1) The
Chairman of the National Development Corporation, who shall act as Chairman; (2)
Government Corporate Counsel; (3) Office of the Executive Assistant, Office of
the President, or their respective representatives; and two other members to be
appointed by the President of the Philippines from the private
sector."
SECTION 2. Section 3 of Presidential Decree No. 1067-B is
hereby amended to read as follows:
"SECTION 3. SPECIAL CONDITION OF FRANCHISE.—Sixty
(60%) percent of the aggregate gross earnings derived by the Franchise Holder
from this Franchise shall be immediately set aside and allocated to fund the
following infra-structure and socio-civic project within the Metropolitan Manila
Area;
Flood Control.
Sewerage and Sewage.
Nutritional Programs.
Population Control.
'Tulungan ng Bayan' Centers.
Beautification.
In addition to the priority infra-structure and socio-civic projects within
the Metropolitan Manila Areas specifically enumerated above, the 60% share of
the government in the aggregate gross earnings derived by the Franchise Holder
from this Franchise may now be appropriated and allocated to fund and finance
any infra-structure and/or socio-civic projects throughout the Philippines as
may be directed and authorized by the Office of the President."
SECTION 3. Section 4 of Presidential Decree No. 1067-B is
hereby amended to read as follows:
"SECTION 4. EXEMPTIONS.—
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 duties, taxes and other imposts, including all kinds of fees, levies,
or charges of any kind or nature.
Vessels and/or accessory ferry boats imported or to be imported by any
corporation having existing contractual arrangements with the Franchisee, 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 taxes, duties and other imposts, including all kinds of fees,
levies, assessments or charges of any kind or nature, whether National or local.
Income and other taxes.—
Franchise Holder: No tax of any kind or form, income or otherwise, as well
as fees, charges, or levies of whatever nature, shall be assessed and collected
under this Franchise from the Franchise Holder; nor shall any form of tax or
charge attach in any way to the earnings of the Franchise Holder, except a
Franchise Tax of five (5%) percent of the gross revenue or earnings derived by
the Franchise Holder 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
taxes, levies, fees or assessments of any kind, nature or description, levied,
established, or collected by any municipal, provincial or National authority.
Others: The exemption 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
insure to the benefit of and extend to corporation/s, association/s, agency/ies,
or individual/s with whom the Franchisee has any contractual relationship in
connection with the operations of the casino/s authorized to be conducted under
the franchise and to those receiving compensation or other remuneration from the
Franchise Holder as a result of essential facilities furnished and/or technical
services rendered to the Franchise Holder.
Dividend Income.—In the event the Franchisee 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 flat income 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 form of taxes if
invested within six (6) months from the date the dividend income is received, in
the following:
Operation of the casino/s or investments in any affiliate activity that will
ultimately redound to the benefit of the Franchisee-corporation; or any other
corporation with whom Franchisee has any existing arrangements in connection
with or related to the operations of the casino/s;
Government bonds, securities, treasury notes, or government debentures;
BOI-registered or export-oriented corporation/s;
Any productive enterprise, or
In payment of government or other form of indebtedness guaranteed by the
government through any of its financing or banking institutions.
Utilization of foreign currencies.—The Franchisee 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 specific area in the casino/s or gaming pit shall be put up solely and
exclusively for players and patrons utilizing foreign currencies;
Franchisee shall appoint and designate a duly and accredited commercial
bank, agent of the Central Bank, to handle, administer and manage the use of
foreign currencies in the casino/s;
Franchisee shall provide an office at the casino/s exclusively for the
employees of the designated bank, agent of the Central Bank, where the
Franchisee shall maintain a dollar account which will be utilized exclusively
for the above purpose and the casino dollar treasury employees;
Only persons with foreign passports, or certificates of identity (for
Hongkong patrons only), duly issued by the government or country of their
residence will be allowed to play in the foreign exchange gaming pit.
Only foreign exchange prescribed to form part of the Philippine
International Reserve and the following foreign exchange currencies: Australian
Dollar, Singapore Dollar, Hongkong Dollar, shall be used in this gaming pit;
The disbursements, 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 transactions in
such foreign exchange currencies by the Franchisee shall be duly recorded and
reported to the Central Bank thru the designated Agent Bank.
The Franchisee 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 setforth are strictly complied with."
SECTION 4. Section 5, Par. (1) of Presidential Decree No.
1067-B is hereby amended to read as follows:
"SECTION 5. OTHER CONDITIONS.—
Place.—The Franchise Holder 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 Franchise Holder 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."
SECTION 5. This Decree shall take effect immediately.
DONE in the City of Manila, this 2nd day of June, in the year of Our Lord,
nineteen hundred and seventy-eight.
(Sgd.) FERDINAND E. MARCOS
President
Republic of the Philippines
By the President:
(Sgd.) JUAN C. TUVERA
Presidential Assistant
