HomePublicationsNewsletter ArchiveNewslettersVolume 21Issue 16Compliance Summary: Vendor Exemptions and Waivers from Supplier-Licensing Requirements

In addition to its regular coverage of gaming news, The Michigan Gaming Newsletter will be providing compliance updates and summaries of the various legal and regulatory requirements for companies involved in the state’s gaming industry. This week, we have included a review of the new vendor licensing and registration requirements that affect non-gaming businesses. The following is a general discussion of the state’s compliance requirements and should not be considered legal advice.

The Michigan Gaming Control Board (“MGCB”) requires that certain individuals or entities that supply goods or services to the Detroit casinos apply for and receive a valid supplier license, vendor registration, or exemption from the state’s gaming licensing process. This article will broadly discuss the new non-gaming vendor requirements that were enacted earlier in the year.

Resolution 2015-01 (“Resolution”), effective February 1, 2015, rescinds non-gaming supplier licensing requirements that were issued by the MGCB through various resolutions dating back to 1998, the most recent of which occurred in 2012. The Resolution provides guidance for the MGCB’s licensing policy for non-gaming suppliers – vendors that provide goods or services that generally do not affect the gambling activity at the casino, such as advertisers, food providers, outdoor maintenance, and other companies – primarily by increasing the business volume thresholds that trigger licensing requirements.

Those non-gaming suppliers that provide less than $50,000 in any 12-month period are now automatically exempt from the licensing process. There are no reporting or approval requirements for these companies. The MGCB previously allowed for automatic exemptions for those companies providing up to $15,000 worth of goods or services in any 12-month period. Automatic exemptions are also available for certain fields of commerce or business types, such as those that are regulated by another state agency, professional service providers (legal, etc.), financial institutions, and similar industries.

Non-gaming suppliers that provide $50,000-$400,000 worth of goods or services in a rolling 12-month period may apply for a license exemption with the MGCB. The MGCB previously allowed for discretionary exemptions for those companies providing $15,000-$300,000 worth of goods or services in any 12-month period. Those businesses that fall into this category must complete the Vendor Exemption Application form, which requests basic identification information, a description of the goods provided, a basic tax and criminal history, as well as for information on the company’s executives and owners among other items. The fee for the initial exemption application is $200. Renewal applications must be submitted annually with a $100 renewal fee.

Those companies that provide non-gaming goods and/or services in excess of the $400,000 per 12-month period must first obtain a Non-Gaming Supplier License from the MGCB before doing business with the Detroit casinos. Notably, temporary licenses are available so that a company can do business while the MGCB reviews and investigates the applicant. Non-gaming license applications will be covered in more detail in The Michigan Gaming Newsletterin the coming weeks.

As a general rule, those seeking any type of gaming approval should be thorough, forthright, and work closely with gaming regulators to ensure that the license application process goes smoothly. The MGCB has guides and materials on their website (link below) to guide those new to the gaming industry. The MGCB also holds outreach events such as last week’s Pure Michigan Gaming Summit making MGCB representatives available to respond to questions from interested parties. In addition to publicly available resources, those with complicated corporate structures or potential background issues may seek representation in front of the MGCB by private gaming licensing experts.

For more information regarding the MGCB, please visit their website at: www.michigan.gov/mgcb.

 

Upcoming Events

Casino Job Board

Official Publications

 

RMC Legal

Visit our other website below: