HomePublicationsNewsletter ArchiveNewslettersVolume 18Issue 31State of Industry Regulation Debated at G2E

On Wednesday, October 3, 2012, a panel of industry members and regulators met to discuss the current state of regulatory reform in the industry. The panel was moderated by David O. Stewart, Counsel for Ropes and Gray, LLP, and provided an overview of current reform efforts and the ongoing relationship between the regulatory community and the industry.

Panel members included a mix of industry and regulatory experts including Susan Hensel, President of IAGR and Director of Licensing with the Pennsylvania Gaming Control Board; Mark Lerner, Senior Vice President and General Counsel for Bally Technologies, Inc.; Mark Lipparelli, former Member of the Nevada Gaming Control Board; and Erik Pedersen, Deputy Director at the Michigan Gaming Control Board.

Mr. Pedersen noted that regulators are sometimes in a difficult position to make significant regulatory changes because of statutory constraints placed on state gaming agencies. Though gaming regulatory agencies may suggest paths for changes, there is a general reluctance to reopening any enabling statute to make changes on a statutory level. Mr. Lipparelli and Ms. Hensel echoed these concerns, but Ms. Hensel noted that there has been some success in obtaining statutory amendments in Pennsylvania related to renewal license terms. The panel agreed that reform is easier in established jurisdictions and that a key to reform is giving flexibility to gaming commissions to adapt quickly to new challenges.

Technology also provides a path towards reform, though Mr. Lerner noted that budget constraints are often a barrier to adopting new methods of utilizing current technology. Two areas suggested where technology can be better utilized were in the areas of electronic filing and through the use of video conferences in lieu of personal interviews of applicants.

Mr. Stewart then asked the panel to name one or two reforms that each speaker would like to see put in place immediately. Mr. Lerner noted that manufacturers would like to see an extension of the licensing and renewal terms in order to decrease costs related to completely new applications on a regular basis, in multiple jurisdictions. Also, increased adoption of the Multijurisdictional Personal History form for individual applications could create efficiencies for qualifiers of gaming businesses. Ms. Hensel agreed and added that increased use of technology could help reduce many filing issues.

Mr. Pedersen noted that license applications should be updated after an assessment on how the information in the form is used in practice. Also, he noted that regulators may be able to move away from requiring pre-approval of certain operational matters by regulators, and instead rely on audits of processes to ensure compliance. He noted that the pre-approval process at times creates a burden on both the operator and regulators that could be avoided.

Mr. Lipparelli also stated that the gaming machine shipping notice policies can be revisited due to the increased shift towards server-based gaming. New technological advances can also help to streamline the testing and game approval process. 

The panel discussion was a continuation of discussions at the 2011 G2E, which provided an overview of the American Gaming Association’s regulatory reform efforts. To view the AGA’s current regulatory reform efforts, including the 2011 white paper titled “Improving Gaming Regulation: 10 Recommendations for Streamlining Processes While Maintaining Integrity,” please visit the AGA website at www.americangaming.org

 

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