Nevada Regulators Closer To Updating Gaming License Requirements

July 6, 2022
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As the gaming industry continues to evolve in Nevada, regulators have spent considerable time this year updating the state’s rules related to licensing, associated equipment, junket registrations and sports-betting data, among other areas.

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As the gaming industry continues to evolve in Nevada, regulators have spent considerable time this year updating the state’s rules related to licensing, associated equipment, junket registrations and sports-betting data, among other areas.

Proposed regulatory changes, authored by the Nevada Gaming Control Board (NGCB) staff, to the registration of associated equipment manufacturers and distributors are the latest to be considered for final approval by the Nevada Gaming Commission (NGC).

The updates also harmonize the revocation process with gaming devices and associated equipment, as well as allowing the NGCB, depending on the risk, to consider changing a gaming entity requiring a license to a registration, according to control board staff.

Currently, the NGCB is allowed to immediately revoke any gaming device that represents a risk to the integrity and well-being of Nevada. The proposed amendment would address associated equipment related to gaming in the same manner.

Nevada regulations define associated equipment as any equipment used remotely or directly in connection with gaming or mobile gaming, any game, race book or sports pool that would not otherwise be classified as a gaming device, including dice and playing cards, among other devices.

The commission will consider whether to approve the draft updates at its meeting on July 28.

“During the 2021 legislative session, some statutory changes were made through the passage of Assembly Bill 7 specific to regulations of associated equipment manufacturers and distributors,” said Mike Somps, senior deputy attorney general with the Nevada attorney general’s office.

As a result of those changes, Somps said, regulations need to be adopted that not only require manufacturers and distributors of associated equipment to be registered but also people having a significant involvement in the manufacturing or distribution of associated equipment.

Somps told the three-member control board at a hearing last month that NGCB staff took the opportunity when crafting the regulations to make some broader changes that are designed to “create a one-stop location” for how registration will work for four types of registrations.

Those would be registrations for manufacturers and distributors of associated equipment, service providers, independent hosts and junkets or "independent agents", which means anybody who approves or grants the extension of gaming credit on behalf of a licensee.

According to state regulations, independent agents also collect debts and contract with a licensee or its affiliate to provide services outside Nevada, including for transportation, food, lodging, or any combination of those whose retail price exceeds $1,000 in any seven-day period for guests at a licensed gaming establishment.

Somps said these four registrations have similar requirements, so the goal of this regulation was to consolidate all the requirements into one. He added that the regulation also addresses how to register and that the board must maintain a list on its website of those who are registered.

The fee for registering remains at $500, but the amount of the investigation fee is left up to the discretion of the board chairman. Somps said each registration is valid for five years, while another change would allow independent hosts to act on behalf of more than one licensee.

As of Tuesday (July 5), no public or industry comment had been posted on the NGCB’s website.

“We figured these changes would make it easier for the industry to understand,” said Diane Presson, a supervisor with the NGCB. “If approved by the commission, it will allow the board depending on the risk to change something from licenses to a registration. That was one of the other goals we had.”

Brin Gibson, chairman of the NGCB, praised Presson and board staff for going back and cleaning up regulations as if they “were written out of whole cloth, which is how it should be done.”

NGCB member Phillip Katsaros described the updated regulations as “a great product.”

“It is where it needs to be,” Katsaros said. “That doesn’t mean in the future we may have tweaks as well as things evolve in our industry. That’s to be expected.”

Elsewhere, the NGCB will hold a hearing on July 13 to consider possibly recommending to the commission a set of amendments to regulations regarding information that needs to be furnished by licensees, unlicensed games, accounting records, records of ownership, audited financial statements, and slot machine tax and license fees.

Among the proposed change is a requirement that every licensee report to the board annually, instead of quarterly, the name and address of every person, including lending agencies, “who has, or had during the previous 12 months, any right to share in the profits.”

But the control board has yet to schedule another meeting to consider approving updates to its sports-betting rules.

The NGCB debated proposed regulatory changes in May that included establishing a minimum criteria for suppliers’ of sports-betting data to be licensed as an “information service,” as well as a sports wagering licensee’s responsibility for services provided by its data suppliers.

Among the other proposed amendments are removing the requirement that account wagering systems and call centers be physically located in Nevada and removing the word “management” from the definition of an information technology service provider.

During a May 4 workshop on the proposals, Gibson asked the state’s gaming industry to submit additional comments before the board considers any final recommendations. Since its initial workshop two months ago, no additional industry comments have been submitted to the control board.

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