Expert: PAGCOR minimum guaranteed fee to hit smaller firms
The Philippine Amusement and Gaming Corporation (PAGCOR) is set to introduce a minimum guaranteed fee (MGF) on all accredited online gambling operators from April 2026. But, industry advisers warn this move could reshape the structure of the local iGaming market.
Under a memorandum dated 15 December, PAGCOR said all gaming system administrators (GSAs) and gaming venue operators (GVOs) offering e-games will be required to pay a fixed monthly fee based on minimum gross gaming revenue (GGR) thresholds.
“In order to address the gaps in the current fee structure and uphold the principles of fairness, accountability, and fiscal responsibility, please be informed that the PAGCOR’s Board of Directors approved in its meeting on 04 December 2025 the implementation of a Minimum Guaranteed Fee per month,” Jessa Mariz Fernandez, PAGCOR electronic gaming licensing head, said in the memo.
However, John Calderon, Executive Managing Partner at Consulcy Advisory Group, told SiGMA News the impact on smaller GSAs could be severe, particularly those operating close to the regulator’s minimum GGR requirements. “Looking at the current data, the new minimum guaranteed fee is going to hit smaller GSAs really hard,” Calderon said. He added that operators hovering around the minimum thresholds face limited room for error. “Operators who are just barely making the minimum GGR could easily run into losses if they have one slow month.”
Calderon also pointed to the likelihood that some licence holders may never enter the market under the new cost structure. “A lot of license holders that aren’t even active probably won’t bother launching at all because the costs are too high,” he said.
“The market may feel more stable, but it will also be less competitive and less diverse.”
– John Calderon, Executive Managing Partner at Consulcy Advisory Group
Market consolidation risks
PAGCOR’s latest list of accredited GSAs and registered brands shows 65 GSAs currently authorised to operate. These firms already remit a share of their GGR to the regulator as part of their licensing obligations. The addition of a fixed monthly MGF, regardless of short-term performance, could accelerate consolidation, according to Calderon.
“This will leave only the big, well-funded GSAs in control,” he said. “The market will shrink, with fewer operators and fewer brands, and smaller players will have almost no chance to grow.”
Under the first tranche of implementation, from 1 April to 30 September 2026, GSAs offering electronic casino games and generating a minimum of PHP30 million ($509,400) in monthly GGR will pay a PHP9 million ($152,820) MGF. Those without electronic casino games and earning at least PHP15 million ($254,700) in monthly GGR will pay PHP3 million ($50,940).
From 1 October 2026 onwards, the thresholds and fees rise further. GSAs with electronic casino games generating at least PHP35 million ($594,300) in monthly GGR will pay PHP10.5 million ($178,290), while those without electronic casino games and earning PHP20 million ($339,600) will pay PHP4 million ($67,920) per month.
Calderon said these levels favour scale and capital strength, potentially locking out smaller and mid-sized firms. “Big GSAs will take more control, and smaller operators will either struggle or drop out entirely,” he said.
Regulatory stability versus innovation
From a regulatory standpoint, the MGF offers PAGCOR a predictable revenue stream, particularly from operators with operational status. Fernandez said the fee would apply to all transactions commencing 1 April 2026, for GSAs with operational status.
Calderon acknowledged this benefit but questioned the broader market effects. “From what we can see, the MGF will give PAGCOR steady, predictable revenue,” he said. “But it will also push weaker and inactive operators out.”
He warned that the cost of entry could deter new participants and slow innovation in the Philippine iGaming sector. “New players will see the market as expensive and too hard to enter, which will slow innovation,” Calderon said. While fewer operators may make the market easier to supervise, Calderon argued that reduced competition carries its own risks. “The market may feel more stable, but it will also be less competitive and less diverse,” he said.
Risk of pushing activity underground
Calderon also raised concerns that the policy could have unintended consequences beyond consolidation. “By squeezing smaller operators instead of helping them grow, PAGCOR is basically giving the market to the big players,” he said.
He suggested that a more graduated approach could have supported new entrants and niche brands. “Instead of letting new or small operators start small and add some variety, many are being forced out or pushed underground,” Calderon said. In his view, this dynamic could undermine the regulator’s long-term objectives. “The Philippine gambling scene risks turning into an unpredictable space,” he added.
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