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Nevada at a Glance
Gaming License: Yes
Non-Gaming License: No
Vendor License Exemptions Available: Yes
Temporary License: No
Ownership Disclosure Threshold: All
Institutional Investor Waiver: Yes
Fees: $150 - $1,000
State Gaming Lab: Public
Term of License: Permanent
Political Contribution Restrictions: No

Nevada State Gaming Control Board

gaming.nv.gov
More Nevada State Gaming Control Board Info

Nevada Gaming Supplier Regulatory Overview


Introduction

In 1931, Nevada was the first state to legalize commercial casino gaming. The modern Nevada Gaming Commission ("Commission"), the licensing division of the Nevada Gaming Control Board ("Board"), was established in 1959 through the Gaming Control Act ("Act").

The Commission establishes rules, puts forth policy goals, and acts on all final licensing recommendations from the Board. Although the Commission is the final authority on licensing matters, applicants will interact primarily with Board staff as the Board conducts all license review and investigative processes.

Nevada requires all manufacturers, distributors, and certain employees of entities that produce gaming equipment to be licensed through the Commission. Holding companies of licensed entities also must complete an abbreviated licensing process.

Manufacturer's and/or Distributor's License Requirements

All manufacturers of gaming devices, cashless wagering systems, mobile gaming systems, or interactive gaming systems must be licensed before providing products to licensed Nevada casinos.1

In addition, all distributors and suppliers of gaming devices, cashless wagering systems, mobile gaming systems, or interactive gaming systems must be licensed before providing products to licensed Nevada casinos.2

Fees

1. Application Fees

The application fee for a restricted license (less than 15 machines) is $150 per applicant and/or entity. The application fee for a nonrestricted license (15 or more machines) is $500 per applicant and/or entity.3

2. License Fees

Initial and renewal fees for a Manufacturer's License are $1,000.4 License fees are due on or before December 31 for the ensuing calendar year regardless of the date of issuance.

Initial and renewal fees for a Distributor's or Seller's License are $500.5 License fees are due on or before December 31 for the ensuing calendar year regardless of the date of issuance.

Application

Individuals must complete Form 1 – Application for a Nevada Gaming License ("Form 1") and corporations must complete Form 2 – Application for approval by Corporation/Partnership/Limited Liability Company ("Form 2").

Form 1 contains basic questions relating to the identity of the applicant and the products to be sold.

Form 2 also contains questions relating to basic identity and product sales. However, unlike Form 1, Form 2 requires additional information to be submitted with the application. Additional items include:

1. Certified copy of the Articles of Incorporation, Articles of Organization, or Partnership Agreement.
2. Complete list of all partners, stockholders, or members showing ownership interest.
3. Identities of each officer, director, partner, member, and shareholder.
4. If applicable, the term, position, rights, and privileges of each class of outstanding securities.
5. Options relating to securities or other interests.
6. Annual reports for the past three years.
7. A brief financial history attachment.6
8. A Business Plan.7

In addition to Forms 1 and 2, applicants are required to complete Form 10 – Affidavit of Full Disclosure ("Form 10"), Form 17 – Release and Indemnity of All Claims ("Form 17"), and Form 18 – Request to Release Information ("Form 18"). These forms merely require the signature of the applicant.

The Board may request additional information or documentation at any time during the application process.

Non-Restricted Gaming Employee License Requirements

All officers, directors, members, and equity holders of non-restricted manufacturers, distributors, or suppliers must complete Form 7 – Multi-Jurisdictional Personal History Disclosure Form ("Form 7") and Form 7A – Nevada Supplemental Personal History Disclosure Form ("Form 7A").

Fees

Each individual that must apply for a finding of suitability must pay a nonrefundable $500 application fee.8

Application

The Multi-Jurisdictional Personal History Disclosure Form is a lengthy application requiring detailed personal information. Information required to be disclosed includes:

1. Basic identity information.
2. Citizenship and passport.
3. Residence information, past 15 years.
4. Family relationships.
5. Occupation information for family members, including spouses of family members.
6. Military service background.
7. Education.
8. Offices and positions held, including fiduciary, government, and trust relationships.
9. Offices and positions held by spouse, past one year.
10. Employment history, past 20 years.
11. Spouse employment history, past one year.
12. Professional or regulatory licensing.
13. Gaming licenses applied for or held.
14. Business ownership information, 5 percent threshold.
15. Civil suit and criminal history.
16. Vehicle operation permits and licenses.
17. Financial schedules and bankruptcy history.
18. Net worth statement and schedules including assets and liabilities.
19. Three references over 18 years old who are not related to the applicant.9

In addition to the information requested in the application, the following documents need to be attached in order to complete the application.

1. Photo.
2. Military records, if applicable.10

Applicants must also complete Form 7A, Nevada's supplement, in connection with Form 7. The supplement contains questions relating to citizenship, spouse's citizenship, tax audits and history, expunged criminal or civil records, and personal investment in the applicant's business.11 Form 7A notes that tax returns must also be disclosed.

Holding and Parent Companies

Holding and/or parent companies of a licensed manufacturer or distributor of gaming equipment must complete a separate application, Form 3 – Application for Registration by Holding Company/Intermediary Company. In addition, any person employed at the holding or parent company who engages in the supervision, administration, or is involved in the gaming activities of the licensed subsidiary must file personal history disclosures, as discussed above.12 The following information is necessary to complete the application:

1. Basic identification information.
2. State of incorporation.
3. Description of the business.
4. Complete list of stockholders.
5. Identity of employees involved in gaming-related activities.
6. Terms, privileges, and rights of each class of security outstanding.
7. Terms of outstanding loans or other indebtedness.
8. Forms of security or remuneration derived from gaming activities.
9. Bonus and profit-sharing arrangements.
10. Management and service contracts.
11. Security options.13

Although not explicitly required, the following information and documents may be requested by the Commission.

1. Financial data.
2. Balance sheets.
3. Profits and loss statements.
4. An annual list of stockholders.
5. A list of all registered equity security holders.
6. The identity of new key employees within 30 days of the appointment.
7. Securities and Exchange Commission documents or submissions.14

Supplier Licensing Process

At all times during the application process, the burden of proving an applicant's suitability is on the applicant.15 If an applicant knowingly makes a false statement on any application submitted to the Commission, the statement may be grounds for denial of the license.16

The Commission will only make a final decision on an application once all information requested is received and all fees have been paid.17 Any remaining balance in the applicant's initial deposit will be refunded to the applicant after a final action on the application.18

Disclosure and Reporting Requirements

Before Licensure

An applicant for any licensure must submit to the Commission a statement regarding any child-support payments required of the applicant. If there is a court order requiring child-support payments and the applicant is in violation of that order, then a license will not be issued or renewed.19

After Licensure

Before distributing gaming devices, a licensee must apply for and receive prior approval from the Board.20

Licensed companies may be required to provide notice to the Commission of any person who is elected to a key employee role within 30 days of his or her appointment.

Licensed companies may also be required to provide a complete list of stockholders to the Commission within 30 days after the annual meeting of owners.

Prior approval may be necessary before any holding or parent company can issue any new class of securities.21 Holding or parent companies may also be required to submit Securities and Exchange Commission ("SEC") documents to the Commission within 30 days of their submission to the SEC.22

A licensee must keep a list of all repairs made to gaming devices and make the list available upon request of the Commission.23 All records required to be kept by the licensee regarding maintenance and installation of gaming devices must be kept for five years.24

Gaming Technology Standards

The Board may require that any gaming device offered for play or sold within the state be inspected.25 The cost of this inspection may be charged to the person or entity offering or selling the device.26 Gaming devices include casino interlink systems, mobile gaming devices, interactive gaming devices, and other technology.

Electronic gaming devices must have an average payout of not less than 75 percent of each wager available for play.27 Games that involve an element of skill must meet this standard when the player is utilizing the best method of play.28

Content for gaming devices must not be marketed toward children or contain licensed images or references to subject matter that is primarily marketed toward individuals under the age of 21.29

Each manufacturer must employ an individual who understands the designs of the gaming devices licensed for sale in the state and will respond to inquiries from the Commission regarding the devices.30

For inspection purposes, the Board may require up to two working models of a new or modified device or one working model of an intercasino linked system. The cost of providing the models will be borne by the manufacturer.31 If the Commission determines the devices are safe for use through an initial inspection, a field test for up to 180 days may be ordered.32

It should be noted that independent contractors who develop software, code, or source language for gaming devices must be registered with the Board.33 Manufacturers who contract with independent contractors must maintain records of, and review, the software, code, or source language prior to submission to the Board.34 After testing, the game lab will provide the manufacturer with a report regarding the device and any improvements necessary.35

Exemptions

The Commission may exempt any manufacturer, distributor, or seller from the licensing requirements for any purpose consistent with the Act.36

The 75 percent payout threshold for electronic gaming devices may be waived by the Commission in writing.37
1NRS 463.650(1). See also Reg. 14.020.
2NRS 463.650(1).
3'Application for a Nevada Gaming License,' p. 2.
4NRS 463.660(1)(a).
5NRS 463.660(1)(b).
6'Application for a Nevada Gaming License/Approval by Corporation/Partnership/Limited Liability Company,' pp. 1-4.
7'Instructions to Applicants for a Manufacturer and/or Distributor License,' p. 1.
8Reg. 4.070(3).
9'Multi-Jurisdictional Personal History Disclosure Form.'
10Id.
11'Nevada Supplemental Personal History Disclosure Form.'
12'Application for Registration by Holding Company/Intermediary Company,' p. 1.
13Id. at 1-3.
14Id. at 3.
15NRS 463.650(6).
16Reg. 4.040(2).
17Reg. 4.070(6).
18Reg. 4.070(7).
19NRS 463.651; see also NRS 463.652.
20Reg. 14.180.
21Application for Registration by Holding Company/Intermediary Company,' p. 3.
22Id.
23Reg. 14.200.
24Reg. 14.310.
25NRS 463.670.
26Id.
27Reg. 14.040(1).
28Id.
29Reg. 14.025. See regulation for complete list of subject matter that is restricted from use in gaming devices.
30Reg. 14.060.
31Reg. 14.070; see also 14.120.
32See Reg. 14.080.
33Reg. 14.021.
34Reg. 14.024.
35Reg. 14.090.
36Reg. 14.090.
37Reg. 14.040(1)(b).

This article is provided by Regulatory Management Counselors, P.C. For information about the services they provide please visit our information on gaming licensing and compliance advisors.