205 CMR, § 134.04 - Vendors
No person shall conduct business with a gaming licensee as a vendor unless such person has been licensed as a gaming vendor, as defined by M.G.L. c. 23K, § 2, or registered as a non-gaming vendor, as defined by M.G.L. c. 23K, § 2, in accordance with 205 CMR 134.00. A person shall be considered to be conducting business upon commencement of performance of a contract or provision of a good or service.
A subcontractor to a vendor shall not be required to obtain licensure or registration under 205 CMR 134.00. For purposes of 205 CMR 134.00, a subcontractor shall be considered a person that contracts with a licensed or registered vendor to provide goods or services necessary to fulfill the licensed or registered vendor's contract with a gaming licensee. As part of the application process, vendors shall be required to identify all of its known or anticipated subcontractors and shall have a continuing duty to update the Bureau relative to the identification of any new subcontractors. The Bureau may, at its discretion, require the submission of additional information and documents including, but not limited to, the Subcontractor Information Form as provided in 205 CMR 134.07(11).
(1)
Gaming Vendors.
(a)
Gaming
Vendors-primary. A person who conducts business with a gaming
applicant or gaming licensee on a regular or continuing basis for provision of
goods or services which directly relates to gaming, as defined by M.G.L. c.
23K, § 2 including, but not limited to, a person who does any of the
following, shall be designated as a gaming vendor-primary:
1. Manufactures, sells, leases, supplies, or
distributes devices, machines, equipment (except gaming table layouts),
accessories, or items that meet at least one of the following conditions:
a. are designed for use in a gaming area as
defined by M.G.L. c. 23K, § 2;
b. are designed for use in a simulcast
wagering area;
c. are used in
connection with a game in the gaming area;
d. have the capacity to affect the
calculation, storage, collection, electronic security, or control of the gaming
revenues from a gaming establishment.
2. provides maintenance services or repairs
gaming or simulcast wagering equipment, including slot machines;
3. acts as a junket enterprise; or
4. provides items or services that the Bureau
has determined are used in or are incidental to gaming or to an activity of a
gaming facility.
Exception. Any person, by submission of a written petition, may request a determination from the Bureau that despite meeting a description contained in 205 CMR 134.04(1)(a) they need not be licensed as a Gaming Vendor-primary on the grounds that they are not providing services on a regular or continuing basis or that they do not directly relate to gaming.
(b)
Gaming Vendors-secondary. Any person who regularly
conducts over $250,000 in gross sales with any one gaming licensee within a 12
month period or a person who conducts over $100,000 in gross sales with any one
gaming licensee within a three month period, and who does not otherwise qualify
for designation as a Gaming Vendor-primary in accordance with 205 CMR
134.04(1)(a), may be designated a Gaming Vendor-secondary by the Division of
Licensing after consultation with the Bureau regardless of the type of goods or
services being provided. The procedure for making this designation is set forth
in 205 CMR 134.04(3).
(2)
Non-gaming
Vendors. A person who offers to a gaming licensee goods or
services which are not directly related to gaming, as defined by M.G.L. c. 23K,
§ 2 including, but not limited to any of the following, shall be
designated as a non-gaming vendor:
(a)
construction company;
(b) vending
machine provider;
(c) linen
supplier;
(d) garbage
handler;
(e) maintenance
company;
(f) limousine service
company;
(g) food
purveyor;
(h) supplier of alcoholic
beverages;
(i) a person that sells,
distributes, tests, or repairs antique slot machines as described in M.G.L. c.
271, § 5A;
(j) suppliers of
gaming table layouts.
(3)
The Division of Licensing, after consultation with the Bureau, may designate a
person as a gaming vendor-secondary. In making the determination to designate a
vendor as a gaming vendor-secondary, the following factors may, without
limitation, be considered: the total dollar amount by which the vendor's
business with the gaming licensee is reasonably expected to exceed the
thresholds set forth in M.G.L. c. 23K, § 31(c) and 205 CMR 134.04(1)(b);
the relative value of the contract compared to the gaming licensee's overall
disbursements to vendors; whether the goods or services are limited to the
pre-opening phase of the gaming establishment; the duration of the contract;
whether the vendor will be providing goods or services on-site at the gaming
establishment; the number of subcontractors involved in the performance of the
vendor's contract with the gaming establishment; whether the vendor is
licensed, registered or certified and regulated by a governmental or
quasi-governmental body or board; the nature of the goods or services; and
public safety considerations. If the Division of Licensing determines that the
non-gaming vendor is a gaming vendor-secondary, it shall forward notice of such
to the vendor of its obligation to submit an application for licensure as a
gaming vendor-secondary. Within 45 days of service of the notice, the vendor
shall submit a completed Business Entity Disclosure Form-gaming
Vendor-secondary as set forth in
205 CMR 134.07(3)(b)
for licensure as a gaming vendor-secondary
or file a written request to the Division of Licensing for reconsideration from
the determination requiring filing of an application for licensure as a gaming
vendor-secondary.
(4)
Gaming Vendor Qualifier.
(a) Persons designated as gaming vendor
qualifiers must establish their qualifications in accordance with
205
CMR 134.09 and
134.10.
(b)
Gaming
Vendors-primary. The following persons shall be designated as
gaming vendor-primary qualifiers:
1. If the
gaming vendor-primary is a sole proprietor: The owner.
2. If the gaming vendor-primary is a
corporation:
a. Each officer;
b. Each inside director;
c. Any person owning more than 5% of the
common stock of a company applying for licensure as a gaming vendor-primary as
provided by 205 CMR 134.04(1)(a), or a holding, intermediary or subsidiary
company of such company;
d. In the
judgment of the Division of Licensing after consultation with the Bureau any
person with significant and substantial responsibility for the applicant's
business under the jurisdiction of the commission.
3. If the applicant is a limited liability
corporation:
a. Each Member;
b. Each transferee of a Member's
interest;
c. Each
Manager;
d. In the judgment of the
Division of Licensing after consultation with the Bureau any person with
significant and substantial responsibility for the applicant's business under
the jurisdiction of the commission.
4. If the applicant is a limited partnership:
a. Each General Partner;
b. Each Limited Partner;
c. In the judgment of the Division of
Licensing after consultation with the Bureau any person with significant and
substantial responsibility for the applicant's under the jurisdiction of the
commission.
5. If the
applicant is a partnership:
a. Each
Partner;
b. In the judgment of the
Division of Licensing after consultation with the Bureau any person with
significant and substantial responsibility for the applicant's business under
the jurisdiction of the commission.
(c)
Gaming
Vendors-secondary.
1. If the
gaming vendor-secondary applicant is a sole proprietor, the Owner shall be
designated as a qualifier.
2. If
the gaming vendor-secondary applicant is a corporation, limited liability
corporation, limited partnership, or partnership:
a. Each Officer, Member, Partner or
functional equivalent expected to exercise operational control over the
business under the jurisdiction of the commission shall be designated as a
qualifier;
b. Any person owning
more than 5% of the common stock of a company applying for licensure as a
gaming vendor-secondary shall be designated as a qualifier;
c. In the judgment of the Division of
Licensing, after consultation with the Bureau, any person with significant and
substantial responsibility for the applicant's business under the jurisdiction
of the commission shall be designated as a qualifier;
d. The Division of Licensing, after
consultation with the Bureau, may designate any person owning more than 5% of
the common stock of a holding or intermediary company of an applicant for
licensure as a gaming vendor-secondary as a qualifier.
e. The Division of Licensing, after
consultation with the Bureau, may designate any inside director as a
qualifier.
(d)
In all cases, any person who, in the opinion of the Division of Licensing,
after consultation with the Bureau, can exercise control or provide direction
to a gaming vendor or applicant for a gaming vendor license or holding,
intermediary or subsidiary companies thereof may be designated a gaming vendor
qualifier.
(e)
Other
Qualifiers. The Division of Licensing, after consultation with the
Bureau, may, at its discretion, require other persons that have a business
association of any kind with the applicant for a gaming vendor license to be
subject to the qualification requirements as a qualifier. These persons
include, but are not limited to, an affiliate or holding, intermediary or
subsidiary company of the applicant for a gaming vendor license.
An applicant may appeal any determination made by the Bureau, in accordance with 205 CMR 134.04(4), to the commission by filing a petition on a form prescribed by the commission. The commission shall decide the appeal at a public hearing on the matter at which it may allow representatives of the petitioner and Bureau to testify.
(5)
Waiver. Upon
written petition, the commission may waive the requirement to be licensed as a
gaming vendor qualifier for:
(a)
Institutional investors holding up to 15% of the stock of the gaming vendor or
applicant for a gaming vendor license, or holding, intermediary or subsidiary
company thereof, upon a showing by the person seeking the waiver that it
purchased the securities for investment purposes only and does not have any
intention to influence or affect the affairs or operations of the gaming vendor
or applicant for a gaming vendor license or a holding, intermediary or
subsidiary company thereof. Provided, however, any institutional investor
granted a waiver which subsequently determines to influence or affect the
affairs or operations of the gaming vendor or applicant for a gaming vendor
license, or a holding, intermediary thereof shall provide not less than 30
days' notice to the commission of such intent and shall file an application and
be subject to the licensing requirements of
205 CMR 134.00 before taking
any action that may influence or affect the affairs of the gaming vendor or
applicant for a gaming vendor license or a holding, intermediary or subsidiary
company. Any person holding over 15% of a gaming vendor or applicant for a
gaming vendor license, or a holding, intermediary or subsidiary company
thereof, shall be required to apply for a license before doing business in the
Commonwealth; or
(b) Any person
who, in the opinion of the Bureau or the commission, cannot exercise control or
provide direction to a gaming vendor or applicant for a gaming vendor license
or a holding, intermediary or subsidiary company thereof. Provided, however, a
person who is not an institutional investor and who holds more than 5% of the
common stock of a company, or holding, intermediary or subsidiary company of
such a company may not petition for waiver in accordance with 205 CMR
134.04(5)(b).
(6)
Exemptions. For purposes of 205 CMR 134.04, the
following persons engaged in the following fields of commerce who provide goods
or services to a gaming applicant or gaming licensee, and that are not
otherwise required to be licensed as a key gaming employee, gaming employee, or
gaming service employee, shall not be deemed to be conducting business for
purposes of M.G.L. c. 23K, § 31 and accordingly shall not be required to
obtain licensure or registration as a vendor
(a) insurance companies and insurance
agencies;
(b) television, radio,
newspaper, internet or other similar media outlets used for advertising
purposes;
(c) transactions with a
governmental entity;
(d) legal,
accounting, lobbying and financial services;
(e) physicians;
(f) labor organizations, unions, or
affiliates registered in accordance with
205 CMR 134.00;
(g) utility companies;
(h) telecommunications companies;
(i) training seminars, publication
subscriptions, conference registration or membership dues for professional
associations intended to directly contribute to the work performance or
professional development of an employee;
(j) nonprofit charitable corporations or
organizations, provided that no consideration is received for the
contribution;
(k) court order or
stipulation of settlement or for settlement of guest losses or guest
refunds;
(l) payments for freight
charges to freight transporters select by the vendor for delivering
goods;
(m) professional
entertainers and/or celebrity appearances;
(n) any person that, by submission of a
written petition, can demonstrate to the Division of Licensing after
consultation with the Bureau that registration as a non-gaming vendor is not
necessary to protect the public interest;
(o) Upon submission of a written
certification by a gaming licensee, any person providing goods or services not
directly related to gaming to whom the gaming licensee reasonably expects to
pay an amount less than $10,000 within a 12-month period.
(7)
Qualification of New
Qualifiers for Gaming Vendors-primary.
(a) No person requiring qualification
pursuant to 205 CMR 134.04(4)(b) may perform any duties or exercise any powers
relating to the position that said qualifier is seeking to assume for a Gaming
Vendor-primary licensee unless the person notifies the Bureau in writing within
30 days of appointment to the position. Such notification shall be accompanied
by a completed Key Gaming Employee - Standard Application
Form. Following such notification and submission of the completed
Form, the person may continue to perform duties and exercise powers relating to
the position pending qualification.
(b) A person with reason to believe that his
or her new position with a Gaming Vendor-primary may require qualification
pursuant to 205 CMR 134.04(4)(a) shall notify the Bureau in writing within 30
days of appointment to the position. Such notification shall be accompanied by
a summary of the responsibilities and/or features of the position. The Bureau
shall determine whether the person shall be designated a qualifier pursuant to
205 CMR 134.04(4) and shall notify the person of such designation in writing.
Within 30 days of designation as a qualifier, the person shall submit a
completed Key Gaming Employee - Standard Application Form.
Following submission of the completed Form, the person may continue to perform
duties and exercise powers relating to the position pending
qualification.
(c) The Bureau shall
review the Forms submitted by the new qualifier, as well as such other
information that the Bureau may request, and, upon completion of its
investigation, shall make a determination or recommendation to the commission
in accordance with
205
CMR 134.09(1)(c) whether
the new qualifier meets the standards for suitability.
(d) Upon notification by the Bureau of a
determination that reasonable cause exists to believe the qualifier may not
ultimately be found suitable, a gaming vendor licensee shall promptly remove
the qualifier from his or her position until such time as the commission makes
its final determination on suitability.
Notes
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