Missouri Gaming Supplier Regulatory Overview

Introduction

The Missouri Gaming Commission ("Commission") oversees regulation of all manufacturers and suppliers of equipment to the state's riverboat casinos. Riverboat gaming was authorized in August of 1993, and there are currently 12 riverboat casinos that employ over 10,000 individuals. Last year an estimated 25.83 million people visited Missouri casinos, resulting in over $1.73 billion in revenue.

The Commission requires that individuals or entities that manufacture or supply gaming equipment to the state's casinos be licensed. In addition, certain employees of licensed entities must be found suitable for participation in the state's gaming industry.

Supplier License Requirements

A Supplier's License is required of all persons or entities that manufacture, sell, maintain, provide testing services for, or provide services in connection with gaming equipment.¹

Duration

A Supplier's License is valid for one year.² Renewal forms must be submitted at least 90 days before the expiration date of the current license.³

Fees

A onetime $10,000 application fee is due when submitting application materials to the Commission. Once issued, the Commission requires an annual license fee of $5,000.⁴

Application

Applicants must complete the Supplier's License Application. Information necessary to complete the application includes:

1. Basic identity information;
2. Products information;
3. Business description;
4. Gaming licenses in other jurisdictions;
5. Securities trading violations;
6. Civil litigation history;
7. Debt history;
8. Tax audit history;
9. Political contributions, past five years; and
10. Criminal history.⁵

In addition, the following documents must be submitted in connection with the application:

1. List of the applicant's complete inventory;
2. Price list;
3. Form lease agreements for tangible property;
4. Form service agreements;
5. Agreements between the applicant and casino licensees;
6. Certificates of good standing in the applicant's state of incorporation;
7. Certificate of good standing from the Missouri secretary of state;
8. Certified copies of the Articles of Incorporation and bylaws;
9. Partnership agreement;
10. Audited financial statements, last three years;
11. List of businesses owned, in whole or in part, by the applicant or its key persons;
12. List of relatives of the applicant or its key persons who also hold a license issued by the Commission;
13. Detailed description of the business;
14. List or current and former addresses;
15. List of all other jurisdictions in which the applicant does business;
16. Identity of registered agents, legal service representatives, accounting service representatives, and banking and financial service representatives;
17. Detailed statement regarding the experience of the applicant and its key persons;
18. Description of all bonus and profit-sharing agreements;
19. List of partners, officers, or other persons having policy-making authority;
20. List of individuals or entities with beneficial ownership in the applicant;
21. List of individuals or entities with control over the applicant;
22. Agreements regarding fees, rents, salaries, or other compensation;
23. List of other professional or regulatory licenses held;
24. List of any public official who has been employed by or holds ownership in or a debt instrument issued by the applicant;
25. List of debt instruments;
26. Detailed description of the relationship with casino facility licensees;
27. List of any additional person holding an interest in the applicant;
28. Detailed list of applicant's position in the marketplace and competitive conditions;
29. List of all current and former distributors;
30. Copies of all certificates, registrations, and licenses that allow the company to conduct business;
31. Statements regarding equal opportunity employment conditions; and
32. List of all individuals who will file a Key Person or Occupational Level I application.⁶

Key Person License Requirements

All key persons of licensed suppliers must submit an individual Personal Disclosure Form I in connection with the Supplier's License Application. Key persons include the following:

1. Officers, directors, trustees, or general managers;
2. Holders of 5 percent or more in direct or indirect legal or beneficial publicly traded interest in the applicant or a key person of the applicant;
3. Holders of 1 percent or more in direct or indirect legal or beneficial private interest in the applicant or a key person of the applicant; and
4. Holders of any direct or indirect legal or beneficial interest in an applicant or key person of an applicant if the interest was required to be issued under agreement with or authority of a government entity.⁷

Duration

Key Person licenses are valid for one year from the date of issuance. Renewal forms must be submitted at least 60 days before the expiration of the current license.⁸

Fee

A onetime application fee of $1,000 is due at the time application materials are submitted to the Commission. Once issued, the annual licensing fee is $100.⁹

Application

Applicants must complete the Key Person and Level I Application (Personal Disclosure Form I). The following information is required to complete the application:

1. Basic identity information;
2. Citizenship information;
3. Residence data, since age 18;
4. Family and social data;
5. Military service history;
6. Educational background;
7. Offices and positions held;
8. Employment and licensing information;
9. Spouse's employment and licensing information;
10. Businesses in which applicant or spouse has 5 percent or more ownership interest;
11. Regulatory action/testimony history;
12. Family relationships with employees at gaming operations;
13. Civil, criminal, and investigatory history, including family members' history;
14. Bankruptcy history;
15. Vehicle operator data;
16. Financial data and history;
17. Foreign bank accounts;
18. Loans or gifts of greater than $10,000, past five years, to any member of immediate family;
19. Insurance claims of over $25,000, past five years, including claims by any immediate family member;
20. Finder's fees, past five years; and
21. Identity of three character witnesses, non-family members.¹⁰

In addition, the following documents must be submitted in connection with the application:

1. Photograph;
2. Copy of driver's license; and
3. Tax returns, past five years.¹¹

Occupational Level I License Requirements

All employees in an Occupational Level I position at a licensed supplier must be individually licensed. Occupational Level I positions include the following:

1. Internal Audit Manager;
2. Director of Security;
3. Controller;
4. IT Manager;
5. Surveillance Manager;
6. Assistant General Manager;
7. Managers responsible for ensuring the integrity of all testing standards and certifications; and
8. Any other person or entity that the Commission determines must file an Occupational Level I application.¹²

Duration

Occupational Level I licenses are valid for one year from the date of issuance. Renewal forms must be submitted at least 60 days before the expiration of the current license.¹³

Fee

A onetime application fee of $1,000 is due at the time application materials are submitted to the Commission. Once issued, the annual licensing fee is $100.¹⁴

Application

Applicants must complete the Key Person and Level I Application (Personal Disclosure Form I). The following information is required to complete the application:
1. Basic identity information;
2. Citizenship information;
3. Residence data, since age 18;
4. Family and social data;
5. Military service history;
6. Educational background;
7. Offices and positions held;
8. Employment and licensing information;
9. Spouse's employment and licensing information;
10. Businesses in which applicant or spouse has 5 percent or more ownership interest;
11. Regulatory action/testimony history;
12. Family relationships with employees at gaming operations;
13. Civil, criminal, and investigatory history, including family members' history;
14. Bankruptcy history;
15. Vehicle operator data;
16. Financial data and history;
17. Foreign bank accounts;
18. Loans or gifts of greater than $10,000, past five years, to any member of immediate family;
19. Insurance claims of over $25,000, past five years, including claims by any immediate family member;
20. Finder's fees, past five years; and
21. Identity of three character witnesses, non-family members.¹⁵

In addition, the following documents must be submitted in connection with the application:

1. Photograph;
2. Copy of driver's license; and
3. Tax returns, past five years.¹⁶

Occupational Level II License Requirements

All employees in an Occupational Level II position at a licensed supplier must be individually licensed. An Occupational Level II position is defined as any position that would require the employee to have access to the gambling boat to perform duties involving installation, servicing, maintenance, repair, accessing secured or locked components of gaming equipment, or verifying or payment of patron awards. The Commission may also direct other employees to file an Occupational Level II application.¹⁷

Duration

Occupational Level II licenses are valid for one year from the date of issuance. Renewal forms must be submitted at least 15 days prior to the expiration of the current license.¹⁸

Fee

A onetime application fee of $75 is due at the time application materials are submitted to the Commission. Once issued, the annual licensing fee is $50.¹⁹

Application

Applicants must complete the Personal Disclosure Form II. Information necessary to complete the application includes:

1. Basic identity information;
2. Gaming licenses held;
3. Citizenship information;
4. Residence data, past three years;
5. Family and social data;
6. Military service history;
7. Offices and positions held;
8. Licensing history;
9. Employment history, past five years;
10. Family members who hold gaming licenses;
11. Criminal, civil, and investigatory history; and
12. Financial history and data.²⁰

In addition, the following documents must be submitted in connection with the application:

1. Photograph;
2. Birth certificate;
3. Social Security number;
4. Driver's license or other photo ID;
5. INS documents, if applicable; and
6. Work authorization document.²¹

Temporary Supplier's License

The Commission may issue a Temporary Supplier's License to individuals or entities that meet certain requirements. The main purpose for a temporary license is to provide individuals or entities that have begun the licensing process to conduct business with a licensed facility during the required background checks and application review process. In order to obtain a Temporary Supplier's License, the applicant must have met the following criteria:

1. Completed and submitted a supplier's license application;
2. Paid the required application fees;
3. Provided fingerprints for all necessary persons;
4. Initial criminal and background checks have not revealed any disqualifying information; and
5. The applicant has shown good cause that the temporary license is necessary.²²

Temporary license holders are subject to all reporting requirements that apply to supplier's license applicants and must pay all required annual fees. If a supplier's license is issued, then the licensee will be responsible for a prorated annual fee for that license period.²³

Temporary licenses may be revoked by the Commission at any time by written notice if the supplier's license investigation reveals compromising information regarding the applicant.²⁴

Temporary occupational licenses may be issued by the Commission upon the filing of an occupational license application.²⁵

Gaming laboratories are not eligible for a temporary license.²⁶

Supplier Licensing Process

Interested applicants must complete all necessary applications and pay the necessary fees to the Commission. After the application and fees are received by the Commission, the Commission will review submitted materials and conduct background investigations. During this process, the Commission may request additional information or documentation from the applicant. A personal interview may be required.

Applicants will be evaluated for their personal and professional suitability. The Commission will review personal character traits, personal and business history, and professional viability.²⁷

The Commission may also require the applicant to submit certain products to a certified gaming lab for testing.

After conducting the necessary background checks and reviewing submitted materials, the Commission will make a final determination regarding the issuance of a license to the applicant. Applicants who are found unsuitable for licensure will be notified via certified mail from the Commission. If a license is denied because the applicant is found unsuitable, the applicant may request a hearing.²⁸ If an unsuitable applicant does not request a hearing within 30 days of the date the denial letter was mailed to the applicant, then the denial order becomes final.²⁹

Disclosure and Reporting Requirements

Before Licensure

Any information requested by the Commission must be provided to the Commission within seven days of the request.³⁰

The applicant is required to keep the application current at all times. The applicant must notify the Commission of any changes to responses in the application within 10 days of the change.³¹

After Licensure

Any information requested by the Commission must be provided to the Commission within seven days of the request.³²

Licensed suppliers, Occupational Level I employees, and key persons have a duty to disclose any material change in the information contained on application materials in writing within 30 days of the change.³³ Occupational Level II license holders must notify the Commission of material changes within 10 days of the change.

All license holders have an affirmative duty to inform the Commission of any activities, actions, or circumstances that reasonably indicate that a violation of the law or Commission rules has occurred.³⁴

All supplier license holders must keep a log of all complaints received regarding gaming products and service to be provided with each renewal application. The log must also be made available to the Commission upon request.³⁵

If the Commission requires that the licensee establish minimum internal control standards, then the licensee must submit any changes or amendments to the standards to the Commission within 10 days of the change or amendment.³⁶

Any transfer of interest in a licensed private company or holding company, other than to a financial institution, must receive prior approval from the Commission.³⁷ Notification must be sent at least 60 days before the date of transfer via forms provided by the Commission.

Notification of transfers of interest in licensed, publicly held companies or holding companies that result in a transfer of 5 percent or greater interest must be sent to the Commission at least 15 days prior to the transaction.³⁸ Forms for this transaction are provided by the Commission.

Supplier licensees must inform the Commission if the company, its parent or subsidiaries, its key persons, or management employees are charged or investigated for violation of any jurisdiction's gaming laws or rules within 15 days of receiving notice of the charges or investigation.³⁹

Suppliers of electronic gaming devices must notify the Commission of any shipment of the devices at least five days prior to the shipment.⁴⁰ Forms are available on the Commission website regarding transfer requests.⁴¹

Gaming Technology Standards

The Commission requires that certain gaming equipment be tested by an independent gaming lab to insure the integrity of the equipment. In addition to all gaming equipment, the Commission requires that table games, progressive systems, kiosks, gaming-related software and wireless devices, monitoring systems, and other equipment be tested and certified.⁴²

The person or entity supplying the gaming equipment for testing is responsible for payment of all costs associated with the testing and certification.⁴³

Exemptions

The Commission may waive any licensing requirements if the Commission finds that the requirements do not serve the public interest.⁴⁴

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¹See 11 CSR 45-4.200.
²Mo. Rev. Stat. § 313.807(3).
³11 CSR 45-4.250.
⁴'Supplier's License Application,' p. 3; see also 11 CSR 45-4.240.
⁵'Supplier's License Application.'
⁶'Supplier's License Application.'
⁷'Supplier's License Application,' p. 4.
⁸11 CSR 45-4.390(1).
⁹11 CSR 45-4.380(1), (2).
¹⁰'Key Person and Level I Application (Personal Disclosure Form I).'
¹¹'Key Person and Level I Application (Personal Disclosure Form I).'
¹²11 CSR 45-4.400(2).
¹³11 CSR 45-4.390(1).
¹⁴11 CSR 45-4.380(1), (2).
¹⁵'Key Person and Level I Application (Personal Disclosure Form I).'
¹⁶'Key Person and Level I Application (Personal Disclosure Form I).'
¹⁷11 CSR 45-4.400(3)(C).
¹⁸11 CSR 45-4.390(1).
¹⁹11 CSR 45-4.380(1), (2).
²⁰'Personal Disclosure Form II.'
²¹'Personal Disclosure Form II.'
²²11 CSR 45-4.210.
²³11 CSR 45-4.210(6).
²⁴11 CSR 45-4.210(5).
²⁵11 CSR 45-4.420(2).
²⁶11 CSR 45-4.210(9).
²⁷See 11 CSR 45-4.230 for a detailed explanation of all criteria considered for evaluation of supplier license applicants.
²⁸11 CSR 45-13.045.
²⁹11 CSR 45-13.045(3).
³⁰11 CSR 45-10.010.
³¹11 CSR 45-4.200(4)(A)(7)(e)(v).
³²11 CSR 45-10.010.
³³11 CSR 45-10.020(1).
³⁴11 CSR 45-10.030(1).
³⁵11 CSR 45-4.230(3).
³⁶11 CSR 45-9.030(2).
³⁷11 CSR 45-10.040.
³⁸11 CSR 45-10.040(4).
³⁹11 CSR 45-10.100.
⁴⁰See 11 CSR 45-5.273.
⁴¹See http://www.mgc.dps.mo.gov/nav_forms_riverboat.html#SHIP.
⁴²11 CSR 45-4.230(4).
⁴³11 CSR 45-4.230(4)(L)(3).
⁴⁴11 CSR 45-4.430(1).