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Senate Bill No. 73–Committee on JudiciaryCHAPTER.AN ACT relating to gaming; revising the definition of “gamingdevice” to include mobile gaming; removing or repealingcertain provisions relating to mobile gaming; revising certainprovisions relating to publicly traded corporations registeredwith the Nevada Gaming Commission; and providing othermatters properly relating thereto.Legislative Counsel’s Digest:Existing law requires the Nevada Gaming Commission and the Nevada GamingControl Board to administer state gaming licenses and manufacturer’s, seller’s anddistributor’s licenses, and to reform various acts relating to the regulation andcontrol of gaming. (NRS 463.140) Existing law authorizes the Commission, withthe advice and assistance of the Board, to adopt regulations governing the operationand licensing of mobile gaming. (NRS 463.730) Existing law defines “mobilegaming” as the conduct of gambling games through communication devicesoperated solely within certain establishments holding a nonrestricted gaminglicense that permits a person to transfer information to a computer in order to placea bet or wager, and respective information related to the display of the game, gameoutcomes or other comparable information. (NRS 463.0176) Existing law defines“gaming device” as any object used remotely or directly in connection withgaming, or any other game that affects the results of a wager by determining win orloss but which does not qualify as associated equipment. (NRS 463.0155) Section 2of this bill revises the definition of “gaming device” to include mobile gaming,thereby making mobile gaming subject to the same regulation and control as agaming device. Sections 1.7, 3-10, 11-19 and 20 of this bill remove or repeal allprovisions with individual references to mobile gaming. Section 19.5 of this billexempts from the amendatory provisions of sections 5, 7, 8, 10, 18 and 19: (1)certain persons with a nonrestricted license for a mobile gaming system or such alicense for the operation of a mobile gaming system; (2) certain persons whoacquire a financial interest in such an operator of a mobile gaming system or theoperation of such a system; or (3) a successor in interest of such a person whoacquired such a financial interest. Section 19.5 also exempts from the amendatoryprovisions of section 3 of this bill employees of such an operator of a mobilegaming system described in section 19.5. Section 19.5 also provides that theprovisions of law repealed by section 20 of this bill still apply to those persons ortransactions described in section 19.5. Finally, section 19.5 provides that personsor transactions described in section 19.5 are not exempt from certain provisions oflaw.Existing law requires certain persons to apply for and obtain a finding ofsuitability from the Nevada Gaming Commission if the person acquires, undercertain circumstances: (1) beneficial ownership of any voting security of a publiclytraded corporation registered with the Commission; (2) beneficial or recordownership of any nonvoting security of a publicly traded corporation registeredwith the Commission; or (3) beneficial or record ownership of any debt security ofa publicly traded corporation registered with the Commission. (NRS 463.643)Section 10.8 of this bill requires certain persons to notify the Chair of the Boardand apply for a finding of suitability with the Commission if such a person acquiresor holds a certain percentage of any class of voting securities of a publicly tradedcorporation registered with the Commission. Section 10.8 also requires certain-80th Session (2019)
–2–persons or plan sponsors of a pension or employee benefit plan to notify the Chair,apply for a finding of suitability with the Commission and pay a sum of money tothe Board if such a person or plan sponsor obtains beneficial ownership orownership, as applicable, in such a publicly traded corporation and the person orplan sponsor has the intent to engage in certain proscribed activities, except thatcertain persons who acquire less than a 10 percent beneficial ownership in such acorporation through a pension or employee benefit plan, or plan sponsors whoacquire less than 10 percent ownership in such a corporation, are not subject to suchnotification, application and payment requirements. Sections 1.3 and 1.5 of this billdefine “pension or employee benefit plan” and “proscribed activity” for thepurposes of this bill. Sections 10.2-10.6 make conforming changes.EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED INSENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:Section 1. Chapter 463 of NRS is hereby amended by addingthereto the provisions set forth as sections 1.3 and 1.5 of this act.Sec. 1.3. 1. “Pension or employee benefit plan” means anemployee pension or welfare benefit plan subject to the EmployeeRetirement Income Security Act of 1974 or a state or federalgovernment pension plan.2. The term does not include an employee pension or welfarebenefit plan established by a publicly traded corporation that isregistered with the Commission, unless such a pension or benefitplan is a multiemployer plan as defined in the EmployeeRetirement Income Security Act of 1974, 29 U.S.C. § 1002(37) or§ 1301(a)(3).Sec. 1.5. “Proscribed activity” means:1. An activity that necessitates a change or amendment to thecorporate charter, bylaws, management, policies or operation of apublicly traded corporation that is registered with theCommission;2. An activity that materially influences or affects the affairsof a publicly traded corporation that is registered with theCommission; or3. Any other activity determined by the Commission to beinconsistent with holding voting securities for investment purposesonly.Sec. 1.7. NRS 463.0136 is hereby amended to read as follows:463.0136 “Associated equipment” means:1. Any equipment or mechanical, electromechanical orelectronic contrivance, component or machine used remotely ordirectly in connection with gaming , [or mobile gaming,] any game,-80th Session (2019)
–3–race book or sports pool that would not otherwise be classified as agaming device, including dice, playing cards, links which connect toprogressive slot machines, equipment which affects the properreporting of gross revenue, computerized systems of betting at arace book or sports pool, computerized systems for monitoring slotmachines and devices for weighing or counting money; or2. A computerized system for recordation of sales for use in anarea subject to the tax imposed pursuant to NRS 368A.200.Sec. 2. NRS 463.0155 is hereby amended to read as follows:463.0155 “Gaming device” means any object used remotely ordirectly in connection with gaming or any game which affects theresult of a wager by determining win or loss and which does nototherwise constitute associated equipment. The term includes,without limitation:1. A slot machine.2. Mobile gaming.3. A collection of two or more of the following components:(a) An assembled electronic circuit which cannot be reasonablydemonstrated to have any use other than in a slot machine;(b) A cabinet with electrical wiring and provisions for mountinga coin, token or currency acceptor and provisions for mounting adispenser of coins, tokens or anything of value;(c) An assembled mechanical or electromechanical display unitintended for use in gambling; or(d) An assembled mechanical or electromechanical unit whichcannot be demonstrated to have any use other than in a slot machine.[3.] 4. Any object which may be connected to or used with aslot machine to alter the normal criteria of random selection oraffect the outcome of a game.[4.] 5. A system for the accounting or management of anygame in which the result of the wager is determined electronicallyby using any combination of hardware or software for computers.[5.] 6. A control program.[6.] 7. Any combination of one of the components set forth inparagraphs (a) to (d), inclusive, of subsection [2] 3 and any othercomponent which the Commission determines by regulation to be amachine used directly or remotely in connection with gaming or anygame which affects the results of a wager by determining a win orloss.[7.] 8. Any object that has been determined to be a gamingdevice pursuant to regulations adopted by the Commission.[ ]9. As used in this section [, “control] :-80th Session (2019)
–4–(a) “Control program” means any software, source language orexecutable code which affects the result of a wager by determiningwin or loss as determined pursuant to regulations adopted by theCommission.(b) “Mobile gaming” means the conduct of gambling gamesthrough communications devices operated solely in anestablishment which holds a nonrestricted gaming license andwhich operates at least 100 slot machines and at least one othergame by the use of communications technology that allows aperson to transmit information to a computer to assist in theplacing of a bet or wager and corresponding information relatedto the display of the game, game outcomes or other similarinformation. For the purposes of this paragraph,“communications technology” means any method used and thecomponents employed by an establishment to facilitate thetransmission of information, including, without limitation,transmission and reception by systems based on wireless network,wireless fidelity, wire, cable, radio, microwave, light, optics orcomputer data networks. The term does not include the Internet.Sec. 3. NRS 463.0157 is hereby amended to read as follows:463.0157 1. “Gaming employee” means any personconnected directly with an operator of a slot route, the operator of apari-mutuel system, the operator of an inter-casino linked system ora manufacturer, distributor or disseminator, or with the operation ofa gaming establishment licensed to conduct any game, 16 or moreslot machines, a race book, sports pool or pari-mutuel wagering,including:(a) Accounting or internal auditing personnel who are directlyinvolved in any recordkeeping or the examination of recordsassociated with revenue from gaming;(b) Boxpersons;(c) Cashiers;(d) Change personnel;(e) Counting room personnel;(f) Dealers;(g) Employees of a person required by NRS 464.010 to belicensed to operate an off-track pari-mutuel system;(h) Employees of a person required by NRS 463.430 to belicensed to disseminate information concerning racing andemployees of an affiliate of such a person involved in assisting theperson in carrying out the duties of the person in this State;(i) Employees whose duties are directly involved with themanufacture, repair, sale or distribution of gaming devices,-80th Session (2019)
–5–associated equipment when the employer is required by NRS463.650 to be licensed, cashless wagering systems [, mobile gamingsystems, equipment associated with mobile gaming systems] orinteractive gaming systems;(j) Employees of operators of slot routes who have keys for slotmachines or who accept and transport revenue from the slot drop;(k) Employees of operators of inter-casino linked systems [,mobile gaming systems] or interactive gaming systems whose dutiesinclude the operational or supervisory control of the systems or thegames that are part of the systems;(l) Employees of operators of call centers who perform, or whosupervise the performance of, the function of receiving andtransmitting wagering instructions;(m) Employees who have access to the Board’s system ofrecords for the purpose of processing the registrations of gamingemployees that a licensee is required to perform pursuant to theprovisions of this chapter and any regulations adopted pursuantthereto;(n) Floorpersons;(o) Hosts or other persons empowered to extend credit orcomplimentary services;(p) Keno runners;(q) Keno writers;(r) Machine mechanics;(s) Odds makers and line setters;(t) Security personnel;(u) Shift or pit bosses;(v) Shills;(w) Supervisors or managers;(x) Ticket writers;(y) Employees of a person required by NRS 463.160 to belicensed to operate an information service;(z) Employees of a licensee who have local access and providemanagement, support, security or disaster recovery services for anyhardware or software that is regulated pursuant to the provisions ofthis chapter and any regulations adopted pursuant thereto; and(aa) Temporary or contract employees hired by a licensee toperform a function related to gaming.2. “Gaming employee” does not include barbacks or bartenderswhose duties do not involve gaming activities, cocktail servers orother persons engaged exclusively in preparing or serving food orbeverages.-80th Session (2019)
–6–3. As used in this section, “local access” means access tohardware or software from within a licensed gaming establishment,hosting center or elsewhere within this State.Sec. 4. NRS 463.01715 is hereby amended to read as follows:463.01715 1. “Manufacture” means:(a) To manufacture, produce, program, design, control thedesign of or make modifications to a gaming device, associatedequipment, cashless wagering system [, mobile gaming system] orinteractive gaming system for use or play in Nevada;(b) To direct or control the methods and processes used todesign, develop, program, assemble, produce, fabricate, composeand combine the components and other tangible objects of anygaming device, associated equipment, cashless wagering system [,mobile gaming system] or interactive gaming system for use or playin Nevada;(c) To assemble, or control the assembly of, a gaming device,associated equipment, cashless wagering system [, mobile gamingsystem] or interactive gaming system for use or play in Nevada; or(d) To assume responsibility for any action described inparagraph (a), (b) or (c).2. As used in this section:(a) “Assume responsibility” means to:(1) Acquire complete control over, or ownership of, theapplicable gaming device, associated equipment, cashless wageringsystem [, mobile gaming system] or interactive gaming system; and(2) Accept continuing legal responsibility for the gamingdevice, associated equipment, cashless wagering system [, mobilegaming system] or interactive gaming system, including, withoutlimitation, any form of manufacture performed by an affiliate orindependent contractor.(b) “Independent contractor” means, with respect to amanufacturer, any person who:(1) Is not an employee of the manufacturer; and(2) Pursuant to an agreement with the manufacturer, designs,develops, programs, produces or composes a control program usedin the manufacture of a gaming device. As used in thissubparagraph, “control program” has the meaning ascribed to it inNRS 463.0155.Sec. 5. NRS 463.0177 is hereby amended to read as follows:463.0177 “Nonrestricted license” or “nonrestricted operation”means:1. A state gaming license for, or an operation consisting of, 16or more slot machines;-80th Session (2019)
–7–2. A license for, or operation of, any number of slot machinestogether with any other game, gaming device, race book or sportspool at one establishment;3. A license for, or the operation of, a slot machine route; or4. A license for, or the operation of, an inter-casino linkedsystem . [; or5. A license for, or the operation of, a mobile gaming system.]Sec. 6. NRS 463.160 is hereby amended to read as follows:463.160 1. Except as otherwise provided in subsection 4 andNRS 463.172, it is unlawful for any person, either as owner, lesseeor employee, whether for hire or not, either solely or in conjunctionwith others:(a) To deal, operate, carry on, conduct, maintain or expose forplay in the State of Nevada any gambling game, gaming device,inter-casino linked system, [mobile gaming system,] slot machine,race book or sports pool;(b) To provide or maintain any information service;(c) To operate a gaming salon;(d) To receive, directly or indirectly, any compensation orreward or any percentage or share of the money or property played,for keeping, running or carrying on any gambling game, slotmachine, gaming device, [mobile gaming system,] race book orsports pool;(e) To operate as a cash access and wagering instrument serviceprovider; or(f) To operate, carry on, conduct, maintain or expose for play inor from the State of Nevada any interactive gaming system, without having first procured, and thereafter maintaining ineffect, all federal, state, county and municipal gaming licenses asrequired by statute, regulation or ordinance or by the governingboard of any unincorporated town.2. The licensure of an operator of an inter-casino linked systemis not required if:(a) A gaming licensee is operating an inter-casino linked systemon the premises of an affiliated licensee; or(b) An operator of a slot machine route is operating an intercasino linked system consisting of slot machines only.3. Except as otherwise provided in subsection 4, it is unlawfulfor any person knowingly to permit any gambling game, slotmachine, gaming device, inter-casino linked system, [mobilegaming system,] race book or sports pool to be conducted, operated,dealt or carried on in any house or building or other premises owned-80th Session (2019)
–8–by the person, in whole or in part, by a person who is not licensedpursuant to this chapter, or that person’s employee.4. The Commission may, by regulation, authorize a person toown or lease gaming devices for the limited purpose of display oruse in the person’s private residence without procuring a stategaming license.5. For the purposes of this section, the operation of a race bookor sports pool includes making the premises available for any of thefollowing purposes:(a) Allowing patrons to establish an account for wagering withthe race book or sports pool;(b) Accepting wagers from patrons;(c) Allowing patrons to place wagers;(d) Paying winning wagers to patrons; or(e) Allowing patrons to withdraw cash from an account forwagering or to be issued a ticket, receipt, representation of value orother credit representing a withdrawal from an account for wageringthat can be redeemed for cash, whether by a transaction in person at an establishment or throughmechanical means, such as a kiosk or similar device, regardless ofwhether that device would otherwise be considered associatedequipment. A separate license must be obtained for each location atwhich such an operation is conducted.6. As used in this section, “affiliated licensee” has the meaningascribed to it in NRS 463.430.Sec. 7. NRS 463.1605 is hereby amended to read as follows:463.1605 1. Except as otherwise provided in subsection 3,the Commission shall not approve a nonrestricted license, other thanfor the operation of a [mobile gaming system,] race book or sportspool at an establishment which holds a nonrestricted license tooperate both gaming devices and a gambling game, for anestablishment in a county whose population is 100,000 or moreunless the establishment is a resort hotel.2. A county, city or town may require resort hotels to meetstandards in addition to those required by this chapter as a conditionof issuance of a gaming license by the county, city or town.3. The Commission may approve a nonrestricted license for anestablishment which is not a resort hotel at a new location if:(a) The establishment was acquired or displaced pursuant to aredevelopment project undertaken by an agency created pursuant tochapter 279 of NRS in accordance with a final order ofcondemnation entered before June 17, 2005; or-80th Session (2019)
–9–(b) The establishment was acquired or displaced pursuant to aredevelopment project undertaken by an agency created pursuant tochapter 279 of NRS in accordance with a final order ofcondemnation entered on or after June 17, 2005, and the newlocation of the establishment is within the same redevelopment areaas the former location of the establishment.Sec. 8. NRS 463.245 is hereby amended to read as follows:463.245 1. Except as otherwise provided in this section:(a) All licenses issued to the same person, including a whollyowned subsidiary of that person, for the operation of any game,including a sports pool or race book, which authorize gaming at thesame establishment must be merged into a single gaming license.(b) A gaming license may not be issued to any person if theissuance would result in more than one licensed operation at a singleestablishment, whether or not the profits or revenue from gamingare shared between the licensed operations.2. A person who has been issued a nonrestricted gaminglicense for an operation described in subsection 1 [,] or 2 [or 5] ofNRS 463.0177 may establish a sports pool or race book on thepremises of the establishment only after obtaining permission fromthe Commission.3. A person who has been issued a license to operate a sportspool or race book at an establishment may be issued a license tooperate a sports pool or race book at a second establishmentdescribed in subsection 1 or 2 of NRS 463.0177 only if the secondestablishment is operated by a person who has been issued anonrestricted license for that establishment. A person who has beenissued a license to operate a race book or sports pool at anestablishment is prohibited from operating a race book or sportspool at:(a) An establishment for which a restricted license has beengranted; or(b) An establishment at which only a nonrestricted license hasbeen granted for an operation described in subsection 3 or 4 ofNRS 463.0177.4. A person who has been issued a license to operate a racebook or sports pool shall not enter into an agreement for the sharingof revenue from the operation of the race book or sports pool withanother person in consideration for the offering, placing ormaintaining of a kiosk or other similar device not physically locatedon the licensed premises of the race book or sports pool, except:(a) An affiliated licensed race book or sports pool; or-80th Session (2019)
– 10 –(b) The licensee of an establishment at which the race book orsports pool holds or obtains a license to operate pursuant to thissection. This subsection does not prohibit an operator of a race book orsports pool from entering into an agreement with another person forthe provision of shared services relating to advertising or marketing.5. Nothing in this section limits or prohibits an operator of aninter-casino linked system from placing and operating such a systemon the premises of two or more gaming licensees and receiving,either directly or indirectly, any compensation or any percentage orshare of the money or property played from the linked games inaccordance with the provisions of this chapter and the regulationsadopted by the Commission. An inter-casino linked system must notbe used to link games other than slot machines, unless such gamesare located at an establishment that is licensed for games other thanslot machines.6. For the purposes of this section, the operation of a race bookor sports pool includes making the premises available for any of thefollowing purposes:(a) Allowing patrons to establish an account for wagering withthe race book or sports pool;(b) Accepting wagers from patrons;(c) Allowing patrons to place wagers;(d) Paying winning wagers to patrons; or(e) Allowing patrons to withdraw cash from an account forwagering or to be issued a ticket, receipt, representation of value orother credit representing a withdrawal from an account for wageringthat can be redeemed for cash, whether by a transaction in person at an establishment or throughmechanical means such as a kiosk or other similar device, regardlessof whether that device would otherwise be considered associatedequipment.7. The provisions of this section do not apply to a license tooperate [a mobile gaming system or to operate] interactive gaming.Sec. 9. NRS 463.305 is hereby amended to read as follows:463.305 1. Any person who operates or maintains in thisState any gaming device of a specific model, any gaming devicewhich includes a significant modification [, any mobile gamingsystem] or any inter-casino linked system which the Board orCommission has not approved for testing or for operation is subjectto disciplinary action by the Board or Commission.2. The Board shall maintain a list of approved gaming devices[, mobile gaming systems] and inter-casino linked systems.-80th Session (2019)
– 11 –3. If the Board suspends or revokes approval of a gamingdevice pursuant to the regulations adopted pursuant to subsection 4 ,[or suspends or revokes approval of a mobile gaming systempursuant to the regulations adopted pursuant to NRS 463.730,] theBoard may order the removal of the gaming device [or mobilegaming system] from an establishment.4. The Commission shall adopt regulations relating to gamingdevices and their significant modification and inter-casino linkedsystems.Sec. 10. NRS 463.3855 is hereby amended to read as follows:463.3855 1. In addition to any other state license feesimposed by this chapter, the Commission shall, before issuing astate gaming license to an operator of a slot machine route [, anoperator of a mobile gaming system] or an operator of an intercasino linked system, charge and collect an annual license fee of 500.2. Each such license must be issued for a calendar yearbeginning January 1 and ending December 31. If the operation ofthe licensee is continuing, the Commission shall charge and collectthe fee on or before December 31 for the ensuing calendar year.3. Except as otherwise provided in NRS 463.386, the fee to becharged and collected under this section is the full annual fee,without regard to the date of application for or issuance of thelicense.Sec. 10.2. NRS 463.482 is hereby amended to read as follows:463.482 As used in NRS 463.160 to 463.170, inclusive,463.368, 463.386, 463.482 to 463.645, inclusive, and 463.750,unless the context otherwise requires, the words and terms definedin NRS 463.4825 to 463.488, inclusive, and sections 1.3 and 1.5 ofthis act have the meanings ascribed to them in those sections.Sec. 10.4. NRS 463.622 is hereby amended to read as follows:463.622 The policy of the State of Nevada with respect tocorporate affairs, including, without limitation, rporaterecapitalizations affecting corporate licensees and publicly tradedcorporations that are affiliated companies is to:1. Assure the financial stability of corporate licensees andaffiliated companies;2. Protect the continued integrity of corporate gaming inmatters of corporate governance;3. Preserve the beneficial aspects of conducting business in thecorporate form; and-80th Session (2019)
– 12 –[3.] 4. Promote a neutral environment for the orderlygovernance of corporate affairs that is consistent with the publicpolicy of this state concerning gaming.Sec. 10.6. NRS 463.623 is hereby amended to read as follows:463.623 1. The Commission [may] shall adopt regulationsproviding for the review and approval of corporate acquisitionsopposed by management, repurchases of securities and corporatedefense tactics affecting corporate gaming licensees and publiclytraded corporations that are affiliated companies. The regulationsmust be consistent with:[1.] (a) The policy of this state as expressed in this chapter;[2.] (b) The provisions of this chapter;[3.] (c) The requirements of the Constitution of the UnitedStates; and[4.] (d) Federal regulation of securities.2. The regulations must include, without limitation:(a) Procedures by which a person, before engaging in certainproscribed activities, directly or indirectly, to materially influenceor affect the affairs of a publicly traded corporation that isregistered with the Commission, must file an application for afinding of suitability pursuant to NRS 463.643;(b) Provisions that determine which corporate activities, inaddition to those described in subsection 5 of NRS 463.643,influence or affect the affairs of a corporation in such a way thatthe Commission would require a person to file an application for afinding of suitability pursuant to NRS 463.643; and(c) Provisions that ensure that a person is not undulyprohibited from lawfully exercising any of his or her voting rightsderived from being a shareholder of a publicly traded corporation.Sec. 10.8. NRS 463.643 is hereby amended to read as follows:463.643 1. Each person who acquires, directly or indirectly:(a) Beneficial ownership of any voting security; or(b) Beneficial or record ownership of any nonvoting security, in a publicly traded corporation which is registered with theCommission may be required to be found suitable if theCommission has reason to believe that the person’s acquisition ofthat ownership would otherwise be inconsistent with the declaredpolicy of this state.2. Each person who acquires, directly or indirectly, beneficialor record ownership of any debt security in a publicly tradedcorporation which is registered with the Commission may berequired to be found suitable if the Commission has reason to-80th Session (2019)
– 13 –believe that the person’s acquisition of the debt security wouldotherwise be inconsistent with the declared policy of this state.3. Each person who, individually or in association with others,acquires [,] or holds, directly or indirectly, beneficial ownership ofmore than 5 percent of any class of voting securities of a publiclytraded corporation registered with the Nevada Gaming Commission,and who is required to report, or voluntarily reports, the acquisitionor holding to the Securities and Exchange Commission pursuant tosection 13(d)(1), 13(g) or 16(a) of the Securities Exchange Act of1934, as amended, 15 U.S.C. §§ 78m(d)(1), 78m(g) and 78p(a),respectively, shall, [within 10 days] after filing the report and anyamendment thereto with the Securities and Exchange Commission,notify the Nevada Gaming Commission on the date specified inregulation by the Nevada Gaming Commission and in the mannerprescribed by the Chair of the Board that the report has been filedwith the Securities and Exchange Commission
reporting of gross revenue, computerized systems of betting at a race book or sports pool, computerized systems for monitoring slot machines and devices for weighing or counting money; or 2. A computerized system for recordation of sales for use in an area subject to the tax imposed pursuant to NRS 368A.200. Se c. 2.
