WSR 16-19-015 PERMANENT RULES GAMBLING COMMISSION [Filed September 8, 2016, 4:29 p.m., effective October 9, 2016] Effective Date of Rule: Thirty-one days after filing.
Purpose: In July 2015, the commissioners authorized group 12 amusement games to be played by persons twenty-one and over. In March 2016, the commissioners approved rule changes that required distributors of group 12 amusement games to be licensed. Staff realized upon passage of the rule change that the rules would have required Class B and above amusement game licensees who would like to own and/or lease group 12 amusement games to have a distributor's license in addition to, or in place of, the license they currently have. This was not the intent of the original rule. Rules are needed to clearly define the activities of a manufacturer and distributor of group 12 amusement games, Class A amusement game licensees, Class B and above amusement game licensees, and those who need a distributor license.
Businesses will need a:
Citation of Existing Rules Affected by this Order: Amending WAC 230-03-185, 230-03-190 and 230-06-110; and new section WAC 230-06-112.
Adopted under notice filed as WSR 16-12-110 on June 1, 2016.
Changes Other than Editing from Proposed to Adopted Version: There were no variances other than editing from the proposed rules and the final adopted versions.
Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 0, Repealed 0.
Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.
Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 3, Repealed 0.
Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 0, Amended 0, Repealed 0.
Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0; Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 0, Amended 0, Repealed 0.
Date Adopted: August 11, 2016.
Michelle Rancour
Acting Rules Coordinator
AMENDATORY SECTION (Amending WSR 16-08-033, filed 3/30/16, effective 4/30/16)
WAC 230-03-185 Applying for a manufacturer license.
(1) You must apply for a manufacturer license if you:
(a) Make or assemble a completed piece or pieces of gambling equipment for use in authorized gambling activities; or
(b) Convert, modify, combine, add to, or remove parts or components of any gambling equipment for use in authorized gambling activities; or
(c) Manufacture group 12 amusement games approved or modified after May 1, 2016. Manufacturers of group 12 amusement games that were approved before the effective date of this rule must apply by May 1, 2016, and be licensed by December 31, 2016. Manufacturers of group 12 amusement games can sell or lease group 12 amusement games to a licensed distributor or a Class B or above amusement game licensee.
(2) You must demonstrate your ability to comply with all manufacturing, quality control, and operations restrictions imposed on authorized gambling equipment that you want to manufacture or market for use in Washington state.
(3) The licensing process may include an on-site review of your manufacturing equipment and process for each separate type of authorized gambling equipment to ensure compliance capability.
AMENDATORY SECTION (Amending WSR 16-08-033, filed 3/30/16, effective 4/30/16)
WAC 230-03-190 Applying for a distributor license.
You must apply for a distributor license if you:
(1) Buy or otherwise obtain a finished piece of gambling equipment for use in authorized gambling activities ((or a group 12 amusement game)) from another person and sell or provide that gambling equipment to a third person for resale, display, or use; or
(2) Are a manufacturer who sells or provides gambling equipment you do not make to any other person for resale, display, or use; or
(3) Service and repair authorized gambling equipment. However, distributors must not add, modify, or alter the gambling equipment; or
(4) Modify gambling equipment using materials provided by manufacturers to upgrade equipment to current technology.
(5) Buy or lease a group 12 amusement game from another licensee and sell or lease the group 12 amusement game to a Class B and above amusement game licensee.
AMENDATORY SECTION (Amending WSR 16-08-033, filed 3/30/16, effective 4/30/16)
WAC 230-06-110 Buying, selling, or transferring gambling equipment.
(1) All licensees and persons authorized to possess gambling equipment must closely control the gambling equipment in their possession.
(2) Before selling gambling equipment, licensees must ensure that the buyer possesses a valid gambling license or can legally possess the equipment without a license.
(3) Before purchasing gambling equipment, licensees must ensure that the seller possesses a valid gambling license.
(4) Applicants for Class F or house-banked card room licenses may purchase and possess gambling equipment during the prelicensing process, but only after receiving written approval from us.
(5) Charitable and nonprofit organizations conducting unlicensed bingo games, as allowed by RCW 9.46.0321, may possess bingo equipment without a license.
(6) Group 12 amusement games can only be sold or leased to Class B and above amusement game licensees by a licensed manufacturer or distributor ((to a licensee)). Class B and above amusement game licensees can lease or rent group 12 amusement games to Class A amusement game licensees. Lease agreements entered into prior to the effective date of this rule may continue until the manufacturer is licensed or December 31, 2016, whichever occurs first.
(7) Licensees may transfer gambling equipment as a part of a sale of a business as long as a condition of the sale is that the buyer receives a gambling license before the sale is complete. Licensees must make a complete record of all gambling equipment transferred in this manner, including I.D. stamps. Licensees must report these transfers, including a copy of the inventory record, to us.
NEW SECTION
WAC 230-06-112 Buying, selling, renting and leasing amusement games.
(1) Class A amusement game licensees can rent or lease amusement games from Class B and above amusement game licensees.
(2) Class B and above amusement game licensees can:
(a) Own and operate group 1 through 12 amusement games at their licensed premises;
(b) Buy or lease group 12 amusement games from a licensed manufacturer or distributor and lease or rent them to Class A amusement game licensees; and
(c) Rent or lease group 1 through 11 amusement games to Class A amusement game licensees.
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