[Federal Register Volume 72, Number 205 (Wednesday, October 24, 2007)]
[Proposed Rules]
[Pages 60482-60483]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-20781]



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Part IV





Department of the Interior





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National Indian Gaming Commission



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25 CFR Parts 502, 542, 543, et al.



Indian Gaming Regulatory Act: Definitions and Classification Standards; 
Proposed Rules

  Federal Register / Vol. 72, No. 205 / Wednesday, October 24, 2007 / 
Proposed Rules  

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DEPARTMENT OF THE INTERIOR

National Indian Gaming Commission

25 CFR Part 502

RIN 3141-AA31


Definition for Electronic or Electromechanical Facsimile

AGENCY: National Indian Gaming Commission (``NIGC'' or ``Commission'').

ACTION: Proposed rule.

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SUMMARY: The proposed rule revises the definition of a term Congress 
used to define Class II gaming. Specifically, the proposed rule revises 
the definition for ``electronic or electromechanical facsimile'' that 
appears in the Commission's regulations. The Commission defined these 
terms in 1992 and revised the definitions in 2002. The proposed rule 
offers further revision.

DATES: Submit comments on or before December 10, 2007.

ADDRESSES: Mail comments to ``Comments on Electronic or 
Electromechanical Facsimile Definition,'' National Indian Gaming 
Commission, Suite 9100, 1441 L Street, NW., Washington, DC 20005, Attn: 
Penny Coleman, Acting General Counsel. Comments may be transmitted by 
facsimile to 202-632-0045, or mailed or submitted to the above address. 
Comments may also be submitted electronically to [email protected].

FOR FURTHER INFORMATION CONTACT: Penny Coleman or John Hay, Office of 
General Counsel, Telephone 202-632-7003. This is not a toll free call.

SUPPLEMENTARY INFORMATION:

Background

    The Indian Gaming Regulatory Act (``IGRA''), 25 U.S.C. 2701-21, 
enacted by the Congress in 1988, establishes the NIGC and sets out a 
comprehensive framework for the regulation of gaming on Indian lands. 
The Act establishes three classes of Indian gaming.
    ``Class I gaming'' means social games played solely for prizes of 
minimal value or traditional forms of Indian gaming played in 
connection with tribal ceremonies or celebrations. 25 U.S.C. 2703(6). 
Indian tribes regulate Class I gaming exclusively. 25 U.S.C. 
2710(a)(1).
    ``Class II gaming'' means the game of chance commonly known as 
bingo, whether or not electronic, computer, or other technologic aids 
are used in connection therewith, including, if played in the same 
location, pull-tabs, lotto, punch boards, tip jars, instant bingo, and 
other games similar to bingo, and various card games so long as they 
are not house banking games. 25 U.S.C. 2703(7)(A). Specifically 
excluded from Class II gaming, however, are banking card games such as 
blackjack and electronic or electromechanical facsimiles of any game of 
chance or slot machines of any kind. 25 U.S.C. 2703(7)(B). Indian 
tribes and the NIGC share regulatory authority over Class II gaming. 25 
U.S.C. 2710(a)(2). Indian tribes can engage in such gaming without any 
state involvement.
    ``Class III gaming'' includes all forms of gaming that are not 
Class I gaming or Class II gaming. 25 U.S.C. 2703(8). Class III gaming 
thus includes all other games of chance, including most forms of 
casino-type gaming such as slot machines of any kind, electronic or 
electromechanical facsimiles of any game of chance, roulette, banking 
card games such as blackjack, and pari-mutuel wagering. Class III 
gaming may be conducted lawfully only if the state in which the tribe 
is located and the tribe reach an agreement called a tribal-state 
compact. Alternatively, a tribe may operate Class III gaming under 
gaming procedures issued by the Secretary of the Interior if the tribe 
and the state have not reached agreement or if the state has refused to 
negotiate in good faith toward an agreement. The tribal-state compact 
or Secretarial procedures may contain provisions for concurrent state 
and tribal regulation of Class III gaming. In addition, the United 
States Department of Justice possesses exclusive criminal jurisdiction 
over Class III gaming on Indian lands and also possesses certain civil 
jurisdiction over such gaming.
    As a legal matter, Congress defined the parameters for game 
classification when it enacted IGRA. As a practical matter, however, 
the congressional definitions were general in nature and specific terms 
within the broad gaming classifications were not explicitly defined. 
The Commission adopted regulations in 1992 that included definitions 
for many terms used in the statutory classification scheme, including 
``electronic or electromechanical facsimile,'' 25 CFR 502.7, and 
``electronic computer or other technologic aid,'' 25 CFR 502.8. The 
Commission revised the definitions in 2002. See 67 FR 41166 (Jun. 17, 
2002) for an extensive discussion of the reasons for the Commission's 
decision to revise these key terms.
    A recurring question as to the proper scope of Class II gaming 
involves the use of electronics and other technology in conjunction 
with bingo and lotto as well as pull tabs, instant bingo, and other 
games similar to bingo that may be Class II if played in a location 
where Class II bingo is played. In IGRA, Congress recognized the right 
of tribes to use ``electronic, computer or other technologic aids'' in 
connection with these forms of Class II gaming. Congress provided, 
however, that ``electronic or electromechanical facsimiles of any game 
of chance or slot machines of any kind'' constitute Class III gaming. 
Because a tribe wishing to conduct Class III gaming may do so only in 
accordance with an approved tribal-state compact, it is important to 
distinguish the two classes.
    As the Commission worked through a process to develop 
classification standards, it became apparent that the revised 
definitions issued by a divided Commission in June 2002, See 67 FR 
41166 (Jun. 17, 2002), did not provide the clarity that had been a goal 
in that rulemaking. Accordingly, the Commission proposes to revise the 
definition of the term ``electronic or electromechanical facsimile.''

Purpose and Scope

    The definition for ``electronic or electromechanical facsimile'' 
has been misconstrued by some as allowing for bingo facsimiles. The 
Commission is convinced that there needs to be a distinction with a 
difference between Class II and Class III gaming. Under IGRA, a 
facsimile is Class III. Courts have taken a plain meaning approach to 
defining facsimile finding that facsimiles are exact copies or 
duplicates. Sycuan Band of Mission Indians v. Roach, 54 F.3d 535 (9th 
Cir. 1995); U.S. v. 162 Megamania Gambling Devices, 231 F.3d 713, 724 
(10th Cir. 2000). It has also been recognized that facsimiles of Class 
II games would be considered a Class III game under IGRA. Diamond Game 
v. Reno, 230 F.3d 365, 366 (D.C. Cir 2000). It has likewise been 
affirmed that facsimiles of games of chance including bingo would be 
violations of IGRA. U.S. v. 103 Electronic Gambling Devices, 223 F.3d 
1091, 1102 (9th Cir. 2000). Finally, it has been determined that even 
if a player is playing against another player and not simply the 
machine that the game may nonetheless be a facsimile. Sycuan Band, 54 
F.3d at 542-43 (concluding that an electronic pull-tab game in which 
one player played with a machine, though not against it, was a class 
III electronic facsimile thereof). The proposed change to the 
definition for the term ``electronic or electromechanical facsimile'' 
will

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clarify that facsimiles of bingo are not permissible Class II games 
under IGRA.

Changes to the Definition of ``Electronic or Electromechanical 
Facsimile'' in Part 502

    a. ``Electronic or electromechanical facsimile''
    The Commission proposes to revise the definition for ``electronic 
or electromechanical facsimile'' contained in Sec.  502.8. Some have 
misinterpreted the 2002 revision and argued that facsimiles of bingo 
were properly classified as Class II. The revision makes clear that all 
games including bingo, lotto and ``other games similar to bingo,'' when 
played in an electronic medium, are facsimiles when they incorporate 
all of the fundamental characteristics of the game. In making this 
change, the Commission also wishes to emphasize that even bingo, lotto, 
and ``other games similar to bingo'' are ``electronic or 
electromechanical facsimiles'' of a game of chance when the format for 
the game either has players playing against a machine rather than 
broadening participation among multiple players, or fully incorporates 
all of the fundamental characteristics of these games electronically 
and requires no competitive action or decision making.

Regulatory Matters

Regulatory Flexibility Act

    This proposed rule will not have a significant economic effect on a 
substantial number of small entities as defined under the Regulatory 
Flexibility Act, 5 U.S.C. 601, et seq. Indian tribes are not considered 
to be small entities for the purposes of the Regulatory Flexibility 
Act.

Unfunded Mandates Reform Act

    The Commission, as an independent regulatory agency within the 
Department of the Interior, is exempt from compliance with the Unfunded 
Mandates Reform Act. 2 U.S.C. 1502(1); 2 U.S.C. 658(1).

Small Business Regulatory Enforcement Fairness Act

    This proposed rule is not a major rule under 5 U.S.C. 804(2), the 
Small Business Regulatory Enforcement Fairness Act. This rule does not 
have an annual effect on the economy of $100 million or more. This rule 
will not cause a major increase in costs or prices for consumers, 
individual industries, federal, state or local government agencies or 
geographic regions and does not have a significant adverse effect on 
competition, employment, investment, productivity, innovation, or the 
ability of U.S. based enterprises to compete with foreign-based 
enterprises.

Takings

    In accordance with Executive Order 12630, the Commission has 
determined that this proposed rule does not have significant takings 
implications. A takings implication assessment is not required.

Civil Justice Reform

    In accordance with Executive Order 12988, the Office of General 
Counsel has determined that the proposed rule does not unduly burden 
the judicial system and meets the requirements of sections 3(a) and 
3(b)(2) of the Executive Order.

Paperwork Reduction Act

    This proposed rule does not require information collection under 
the Paperwork Reduction Act of 1995, 44 U.S.C. 3501, et seq., and is 
therefore not subject to review by the Office of Management and Budget.

National Environmental Policy Act

    The Commission has determined that this proposed rule does not 
constitute a major federal action significantly affecting the quality 
of the human environment and that no detailed statement is required 
pursuant to the National Environmental Policy Act of 1969, 42 U.S.C. 
4321, et seq.

List of Subjects in 25 CFR Part 502

    Gambling, Indian--lands, Indian--tribal government, Reporting and 
recordkeeping requirements.

    Accordingly, for the reasons described in the preamble, the 
Commission proposes to amend its regulations in 25 CFR part 502 as 
follows:

PART 502--DEFINITIONS OF THIS CHAPTER

    1. The authority citation for part 502 continues to read as 
follows:

    Authority: 25 U.S.C. 2071, et seq.

    2. Revise Sec.  502.8 to read as follows:


Sec.  502.8  Electronic or electromechanical facsimile.

    (a) Electronic or electromechanical facsimile means a game played 
in an electronic or electromechanical format that replicates a game of 
chance by incorporating all the fundamental characteristics of the 
game.
    (b) Bingo, lotto, other games similar to bingo, pull-tabs, and 
instant bingo games that comply with part 546 of this chapter are not 
electronic or electromechanical facsimiles of any games of chance.

    Dated: October 17, 2007.
Philip N. Hogen,
Chairman.
Norman H. DesRosiers,
Commissioner.
Cloyce V. Choney,
Commissioner.
 [FR Doc. E7-20781 Filed 10-23-07; 8:45 am]
BILLING CODE 7565-01-P