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New technical norms for verification of gambling machines

Monday, 8 February 2021

Teodora Popescu, Associate

Andrei Cosma, Managing Associate Simion & Baciu

by Andrei Cosma, Managing Associate și Teodora Popescu, Associate

Romania’s land-based gambling industry was affected in 2020 by unprecedented legislative inflation, facing a whole wave of regulations and operating restrictions. We do not believe that it is necessary to reemphasize these restrictions imposed by the pandemic, since we all want the epidemiological situation to allow us to forget them as soon as possible.

These regulations were not, however, directed exclusively towards the gambling sector, but rather included gambling in the spectrum of other areas restricted due to the spread of the virus.

However, there are some exceptions. Perhaps most notable is that in December 2020 ONJN adopted Order No. 404/2020 which lays down the new technical verification requirements for the gambling machines (this regulatory act was published in the Official Gazette on January 6th, 2021). It is worth pointing out from the outset that the issuance of a new technical framework for the certification of gambling machines is a welcomed endeavor of the regulator, given that the previous regulation was drafted in the early 2000s and could no longer correspond to the technological realities existing in the market. It must also be said that the new technical rules could have been adopted even (much) sooner, but of course we are still operating on the principle better later than never.

norme tehnice de verificare pentru mijloacele de joc

Given their nature, the rules adopted by ONJN do not present the classic features of the provisions analyzed by lawyers, but inherently refer to technical aspects. Being so, even if we are passionate about technology (especially in the field of gambling), we are not the ones entitled to analyze the reliability of these verification requirements (it is anyway perhaps too early for such a test). However, as lawyers, we cannot refrain from identifying some legal implications even in a regulatory act that deals with the logical area in the CPU box, the blocked hopper or the NVRAM memory.

Several general observations result following a simple reading. The first relates to the drafting style of the rules. As is otherwise natural, in most chapters, the regulation has a general language, leaving the freedom of testing laboratories to establish the concrete method by which compliance with a certain technical standard can be verified. This drafting strategy is justified given that the very title of the ONJN Order speaks of minimum verification requirements. At the same time, a regulatory act governing technical aspects starts with an intrinsic handicap, because technology is evolving much faster than any legislation, so a set of rigid rules could lead to a blockage in the launch of state-of-the-art equipment.

Another finding is that the ONJN Order regulates only the verification requirements for slot machines, although the title of the rules and introductory sections suggest that all land-based gambling equipment is included in the same regulation. The clarification can be found in the last chapter which states that the Order will be supplemented with the verification requirements for the other gambling machines provided for in the legislation. As a result, the new technical framework is not yet complete and we will have to wait to see the test criteria for roulettes, equipment used in bingo games etc.

We also note that under the new rules, type approval is granted for a period of ten years, unlike the old regulation where, as a rule, the same approval had a validity period of four years. At a first glance, extending the validity to ten years seems beneficial for operators, since they will not have to repeat the (sometimes laborious) verification process with a frequency of four years. However, the new regulation assumes that a model of game equipment would have commercial relevance for a ten-year horizon. In other words, an operator receiving type approval for a particular model in 2021 will (or can) exploit the same model in 2031 (only for context, the first human mission to Mars is planned long before 2031). It remains to be seen whether the new duration of the type approval certificate will bring a long-term benefit to operators, seven if it is indeed known that a certain segment of players prefers slots of older generation, for which the degree of wear equates to the degree of confidence.

From a legal perspective, the adoption process for the new regulation stands out. Having a technical nature, the ONJN Order was notified to the European Commission through the TRIS mechanism, a procedure in which several professional associations as well as active suppliers in the Romanian market submitted multiple observations.

The most often cited criticism against the draft rules published on the ONJN website concerned the provision that slot machines conforming to an approved type must have a percentage of winnings of between 92% and 95% for the last 12 months of operation. Without having a technical specialization, we cannot determine all the complexities that would have been generated by such a limitation. However, we also wondered why it is mandatory, from the perspective of player protection (which is basically the main objective of the rules) to limit the maximum percentage of winnings. In other words, what would be the damage suffered by a player if a particular device, verified according to the legal provisions, registers a 97% share of winnings, and not just 95%? The comments made under the TRIS mechanism appear to have achieved their purpose since this limitation is no longer found in the final version of the ONJN Order published in the Official Gazette.

Another criticism of the draft rules concerned the provision that the conformity assessment bodies licensed by ONJN must be established under Romanian law and accredited by the national accreditation body. These requirements could have been regarded as genuine barriers to the freedom to provide services, in particular in the context where Regulation (EC) 765/2008 enshrines the fact that a single Union-wide accreditation is sufficient and the condition of a multiple accreditation must be avoided. The final version of the ONJN Order no longer expressly sets out these requirements in relation to the conformity assessment bodies.

The ONJN Order sets up a new verification framework for the gambling machines, which inherently raises the issue of the transitional regime. At the project stage, the rules provided that testing laboratories may issue verification certificates on the basis of previous procedures/regulations for a maximum period of 24 months “from the publication of the order“. Critical or not from a practical perspective, this provision had at least clear content and one could easily determine the transition period. However, the adopted version of the ONJN Order contains another provision stipulating that laboratories may continue to issue certificates based on old procedures for a maximum 12 months ” after the issuance of the accreditation scheme by the national accreditation body“. However, the new rules do not explicitly indicate the deadline for the accreditation scheme to be issued, which is why the transitional period remains practically an open issue.

We conclude this article by welcoming any legislative modernization in the field of gambling and hope that in the future we will have the opportunity to look at similar topics, and the problems of 2020 will remain only a sad memory.

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Author: Editor

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