(Noell Evans) – Is the Nevada gaming industry over-regulated? That’s the question being asked by many inside the industry, particularly as gaming companies attempt to meet the needs of players with expansion through technology.
One of the regulations that has grabbed the most attention is the need for a company to be licensed in every market in which it operates. For smaller companies, that requirement can slow – or even stop – growth while larger corporations can grow more quickly but at a steep cost.
“The gaming industry is one of the most highly regulated industries in the U.S., with more than 4,000 regulators across the country dedicated to protecting the integrity of gaming and ensuring public trust,” Chris Cylke, the American Gaming Association’s senior vice president of Government Relations, said. “In the gaming marketplace, as in others, entrepreneurs are faced with the same challenges when setting out to start or expand their business, including weighing costs of bringing a product to market against the potential return on investment.”
Some companies have been required to pay millions of dollars in licensing fees for the opportunity to expand their business. The licensing process, which can include in-person interviews, background checks, and lengthy reviews of personal and financial data, can prove daunting to go through once. Growing companies have to repeat the process multiple times.
Critics say this type of regulatory repetition will hold back innovative companies who otherwise would enter the industry, ultimately stifling job growth.
Cylke is of the opinion that “new innovations in the gaming industry have the opportunity to flourish as long as companies operate within the established regulatory framework that continues to guide and strengthen our industry.”
Within Nevada, individuals who own more than 5 percent of a private company involved in the gaming industry must have their own license. If the company is public, anyone who owns more than 10 percent of the company must go through an investigation as part of the license award process. In both examples, individuals who own lower amounts of the company still must complete a registration process.
Cylke conceded that there could be room for compromise.
“(The) AGA believes it is important to continue to work with regulators to harmonize and streamline some regulations in order to create efficiencies for businesses operating in multiple gaming jurisdictions,” he said.