Gaming machine update: Skillette machines

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Do you have a Skillette machine? If so, and it is not covered by the appropriate authorisations, you may find yourself facing prosecution.

So, what is a Skillette machine, and what is all the fuss about? There are apparently various machines out there supplied to operators on the basis that they will not need a licence, permit or notification, because they are not “gaming machines”. These Skillette machines include:

• Grand Prix Racer
• Stop the Clock
• Alien Invasion, and
• Skill Stop Roulette

And why is the chap found guilty of supplying these machines to operators now behind bars, with a bill of £120,000 to pay in costs to the Gambling Commission? It all stems back to the Gambling Act 2005, which covers all aspects of gambling, including the supply etc and use of gaming machines.

Gaming machines

The definition of gaming is a game of chance played for a prize. If it is a game of skill, therefore, it is not gaming and does not require authorisation under this legislation. If the game involves both chance and skill, then effectively the ordinary skill aspect has to positively outweigh the chance element to avoid the requirement for authorisation.

AWP and SWP machines

The above definition of “gaming” basically means that a Skill with Prizes machines (SWP) will not require a Permit. It was this exemption on which the hapless Mr Holleran relied in the supply of these machines, and apparently persisted in doing so even when the Gambling Commission warned him that it was their view that these were not skill based games machines, but Gaming Machines. The trade was also warned by the Commission, particularly about the Skill Stop Roulette machine, with such warnings going back to late autumn 2010. This was ultimately accepted by Mr Holleran, who entered guilty pleas to the 11 charges brought by the Commission in respect of the provision, supply and maintenance of these machines.

The Commission has issued Advice Notes on the subject of the definition of Gaming Machines, and whether a prize machine would fall in this category, and these can be found on the Commission’s website. Operators are advised to obtain clear confirmation from suppliers that the machines being offered as SWPs clearly fall within these Advice provisions. Following this conviction, the Commission has marked the cards of the various responsible authorities (including Police and enforcement teams at Local Authorities) to be on the lookout for unauthorised Skillette machines.

Gaming machines will require a Licence or Permit, dependent on the nature of the stakes and prizes offered and the premises on which they are sited, unless they are exempt.

Categories of machine

There are now 4 categories of machines, which are defined by the stake and prize:

Category A  Casino machines  

Category B 5 different types of high prize machine (prizes ranging from £250-£4,000)

Category C Maximum stake of £1 and prize of £70

Category D Stakes of 10p and £5 cash or 30p and £8 non-monetary unless crane machine when £1 and £50, or mixed monetary and pusher/penny falls, when 10p and £15

The stake must be by cash or token, not by credit or debit card. Combined prize machines have maximum monetary payouts.

Supply of machines

The supply of gaming machines, and the technical requirements for such machines, are very strictly controlled. Certain information must also be clearly given and displayed on the machines. The supplier must have the appropriate Operating Licence issued by the Gambling Commission and operators should check and note that the supplier has an appropriate Operating Licence in force for their own protection. If a machine is offered which does not meet with these strict requirements, or for which there is no authorisation, then a fine of up to Level 5 (currently £5,000 and/or up to 51 weeks imprisonment) could be imposed on conviction. 

Authorisation

The following rules apply to those with a Premises Licence for on sales, those with a requirement that alcohol is sold only with food. They relate to category C and Category D machines only.

2 AWPs

If you only want to keep 2 AWPs in your bar area, then all you need to do is to give written notice to the council prior to installation of the machines, or on your takeover (at the same time as Transfer of the Premises Licence) if you are the new owner. The fee set by regulations will be payable. This is currently £50.

The Council cannot impose  restrictions or conditions, although they may be able to insist on the provision of additional information. You must, however, continue to comply with the Gambling Commission’s Code of Practice for the use of such machines. Misuse of the machines etc could lead to a Removal Order, so stopping you making gaming machines available.

3 or more AWPs

If you want more than 2 AWPs, the Premises Licence holder must make formal application for an Alcohol Licensed Premises Permit. You will need to follow the requirements to complete the appropriate form, provide the requisite information and pay the fee (currently £150).

The Council is obliged to have regard to the licensing objectives set out in the Gambling Act (not the same as the Licensing Act objectives) and any Guidance issued by the Commission.  They have a complete discretion to consider any other matters they think relevant, although they cannot refuse without giving you a chance to make representations.  They may grant as requested, grant with a different number or category of machine, or refuse. The fee is unlikely to be refundable.

Annual fees

A fee is payable within 30 days of the anniversary of the issue of the Permit. This is currently £50. Failure to pay within that time will result in the loss of the Permit. There is no obligation on the Council to remind you of the date, so diarise!

Codes of practice

The Gambling Commission has issued a Code of Practice by which Permit holders must abide. The most recent version for Permit holders is dated March 2012. Full details can be found on the Gambling Commission’s website. The Code has both mandatory and advisory aspects. The location and operation of machines is mandatory and you must:

• Have them sited in a place where they can be properly supervised.
• Arrange for proper supervision
• Not allow them to be so close to an ATM that a machine user would not have to move away from the machine to use the ATM.  They must have to stop their gaming to use the ATM machine. 

You are advised to take steps to prevent under 18s gambling, including Challenge 21 style checks of ID and ensuring that staff are aware of the duty to prevent under 18s playing the machines. You are also advised to have a procedure in place to deal with persistent attempts to gamble by a child.

There are specific self-exclusion measures that a customer with gambling problems can adopt under the Act. You are encouraged to support and assist anyone who advises you of a self-exclusion agreement by preventing them from gaining access to or playing on the machines.  The Code gives additional guidance in this respect and on complaint procedures regarded as good practice.