# COMAR Title 36 — Maryland State Lottery and Gaming Control Agency ## Subtitle 08 — Skills-Based Amusement Devices ### Chapter 03 — Amusement Gaming License **Authority:** Criminal Law Article, §§12-301 and 12-301.1; State Government Article, §§ 9-1B-01— 9-1B-02; Annotated Code of Maryland **Administrative History:** Effective date: January 1, 2017 (43:23 Md. R. 1281) **Administrative History:** Regulation .01B amended effective July 7, 2025 (52:13 Md. R. 657) **Administrative History:** Regulation .02B, E, G amended effective July 7, 2025 (52:13 Md. R. 657) **Administrative History:** Regulation .02D amended effective October 19, 2020 (47:21 Md. R. 905) **Administrative History:** Regulation .03 amended effective July 7, 2025 (52:13 Md. R. 657) **Administrative History:** Regulation .04 amended effective July 7, 2025 (52:13 Md. R. 657) **Administrative History:** Regulation .06B amended effective July 7, 2025 (52:13 Md. R. 657) #### Regulation .01 Definition. *COMAR 36.08.03.01* A. In this subtitle, the following term has the meaning indicated. B. Term Defined. “Family entertainment center” has the meaning stated in State Government Article, §9-1B-01, Annotated Code of Maryland. #### Regulation .02 Amusement Gaming License. *COMAR 36.08.03.02* A. A family entertainment center in Worcester County may apply for an amusement gaming license with the Commission if the family entertainment center: (1) Pays: (a) State and local property tax; (b) Sales and use tax; and (c) Admissions and amusement tax; (2) Has a location with a street address; (3) Is located in a building that is owned, leased, or occupied by the family entertainment center for the primary purpose of providing amusement devices to the public; (4) Receives a majority of the gross receipts from amusement, merchandise, redemption or skills-based devices; (5) Markets its business to families with children; (6) Offers attractions such as amusement devices, arcade games, crane games, video games, interactive and sporting games, amusement rides, miniature golf, and bowling; and (7) Has been in continuous operation in the same geographic location since 1975. B. A family entertainment center applying for an amusement gaming license shall provide in a manner specified by the Commission: (1) The owner’s name and address; (2) The family entertainment center address; (3) Documentation verifying, to the satisfaction of the Commission, conformity with the requirements listed under §A of this regulation; and (4) A listing of the skills-based amusement devices that award merchandise or prizes with a wholesale value of more than a minimal value but does not exceed $599 including: (a) Whether the device is a: (i) Redemption device; (ii) Merchandiser device; or (iii) Another type of skills-based amusement device; (b) Maximum wholesale prize value offered; (c) Manufacturer; (d) Model name or number; (e) Serial Number; (f) Theme; and (g) Any additional information required by the Commission. C. An amusement gaming license is valid for 5 years. D. An amusement gaming licensee shall register every other year under COMAR 36.08.02 if the licensee owns any skills-based amusement devices that award prizes other than the award of free play. E. A family entertainment center that holds an amusement gaming license may operate up to 10 skills-based amusement devices that award noncash merchandise or prizes with a wholesale value that is more than a minimal value but does not exceed $599. F. Upon review of the information provided under §B of this regulation, the Commission may: (1) Require the manufacturer to submit a prototype of the device for testing under COMAR 36.08.04; and (2) Determine that the applicant is qualified and grant the license. G. Upon review of the information provided under §B of this regulation, the Commission may conduct a hearing in accordance with COMAR 36.01.02.06 to deny the license. H. A family entertainment center that holds an amusement gaming license issued under this regulation may not transfer the license to another geographic location. #### Regulation .03 Corrective Action. *COMAR 36.08.03.03* A. Deficiency. If Agency staff determines that an amusement gaming licensee under this chapter no longer meets an amusement gaming license requirement of this subtitle, or that there is cause for imposing sanctions under Regulation .04 of this chapter, the Agency may: (1) Assess the seriousness of the deficiency; (2) Require the amusement gaming licensee to develop a corrective action plan and if required: (a) Conduct periodic monitoring of an amusement gaming licensee to assess the licensee’s progress toward remedying the deficiencies; (b) Evaluate and, if acceptable to the Agency, approve the corrective action plan; (c) Determine appropriate timelines for the completion of corrective action; and (d) Determine whether it is necessary during the pendency of the corrective action process to emergently suspend the amusement gaming license; and (3) Recommend that the Commission impose a sanction under Regulation .04 of this chapter. B. Deficiency Notice. If Agency staff determines that a corrective action plan is required to remedy a deficiency, the Agency shall give written notice to an amusement gaming licensee that includes: (1) A description of the violation; (2) A description of the possible sanctions; and (3) The requirement for the licensee to submit a corrective action plan to the Agency within a time frame established by the Agency. C. Corrective Action Plan. (1) Within 10 days of receipt of a deficiency notice under §B of this regulation, the amusement gaming licensee shall submit a corrective action plan to the Agency for the Agency’s approval. (2) The Agency shall review the corrective action plan and inform the licensee whether the corrective action plan is acceptable. (3) If the licensee fails to submit an acceptable corrective action plan within the time described under §C(1) of this regulation, the Agency may: (a) Provide the licensee with additional time to submit a revised corrective action plan; or (b) Impose a sanction on the licensee under Regulation .04 of this chapter. (4) If the Agency provided a licensee notice under §B of this regulation and received no timely written response, the Commission may adopt as final the Agency’s decision to impose a sanction under Regulation .04 of this chapter. D. Corrective Action Outcomes. (1) If at any time during the corrective action plan period the Agency determines that the amusement gaming licensee has failed to fulfill a requirement of the corrective action plan or has made insufficient progress toward remedying a deficiency, the Agency may: (a) For good cause, extend the time for completion of a corrective action plan; or (b) Emergently suspend the licensee’s license. (2) If at the end of the corrective action plan period the licensee has failed to adequately remedy a deficiency, the Agency may recommend the imposition of a sanction under Regulation .04 of this chapter. #### Regulation .04 Sanctions. *COMAR 36.08.03.04* A. The Commission may impose sanctions on an amusement gaming licensee for: (1) Violating or failing to fulfill the licensee’s responsibilities or a condition of a license under this subtitle; (2) Violating: (a) A provision of law; (b) A regulation adopted under law; or (c) An order or directive of the Commission; (3) Providing the Commission with false or misleading information; (4) Failing to cooperate with the Commission; (5) If a corrective action plan is required by the Agency failing to prepare, submit, or implement an adequate corrective action plan under Regulation .03C of this chapter; or (6) Other activities or action deemed by the Commission to require the imposition of a sanction. B. Types of Sanctions. Sanctions may include emergency suspension, suspension, revocation, and placement of a condition on the amusement gaming license. C. Suspension, Revocation and Conditions. (1) Except as set forth in §D of this regulation, the Agency shall give the amusement gaming licensee notice of the intended sanction at least 15 days before the imposition of the intended sanction. (2) A licensee may appeal the Agency’s recommendation to impose a sanction before the date the sanction is imposed by submitting a timely written request for a hearing before the Commission. (3) A hearing on the Agency’s recommendation to impose a sanction shall be in accordance with COMAR 36.01.02.06. (4) The final action on a sanction is subject to judicial review as provided in State Government Article, Title 10, Subtitle 2, Annotated Code of Maryland. D. Emergency Suspension. (1) Notwithstanding any other requirement of this chapter, if the Director determines that immediate action is necessary to protect against an imminent, serious threat by an amusement gaming licensee to the security, financial stability, reputation or integrity of the State, the Director may suspend a license without prior notice. (2) If the Director emergently suspends a license, the Director shall provide the licensee with written notice that includes: (a) A statement of the authority upon which the suspension is based; (b) The nature of the violation; (c) The duration of suspension; (d) (d) If the Agency permits a corrective action plan, information about the licensee’s obligation to submit to the Agency a corrective action plan; and (e) A statement of the licensee’s right to request a Commission hearing under COMAR 36.01.02.06. (3) If after a license is emergently suspended, the licensee does not submit a timely written request for a Commission hearing, the Director may move to revoke the license by giving the licensee notice under §C of this regulation. #### Regulation .05 Settlement. *COMAR 36.08.03.05* A. The Commission may provide an amusement gaming licensee with the opportunity to discuss with staff a means of entering into a settlement agreement between the licensee and the Commission by which the violation is settled without a penalty or sanction. B. A settlement agreement: (1) Shall be signed by an authorized representative of the amusement gaming licensee and the Director or the Director’s designee; and (2) May not be considered final and binding until approved by the Commission. C. If an amusement gaming licensee violates a term of a settlement agreement, nothing in this regulation shall be construed to prevent the Commission from imposing a penalty or sanction against the licensee for that, or the underlying, violation. #### Regulation .06 Hearings. *COMAR 36.08.03.06* A. The Commission shall conduct a hearing in order to: (1) Deny an amusement gaming license; (2) Suspend an amusement gaming license; or (3) Revoke an amusement gaming license. B. Denial of an Amusement Gaming License. (1) After reviewing an application submitted under this chapter, the Agency may recommend that the Commission deny an amusement gaming license. (2) If the Agency recommends that the Commission deny a license, the Agency shall promptly provide the applicant with written notice of the: (a) Recommendation for denial; (b) Basis for the recommendation; and (c) Applicant’s right to request a reconsideration meeting with the Agency. (3) An applicant may submit to the Agency a written request for a reconsideration meeting within 15 days of the date of the notice described in §B(2) of this regulation. (4) If an applicant fails to timely submit a request under §B(3) of this regulation, the Commission may adopt as final the recommendation of the Agency. (5) During a reconsideration meeting, an applicant may: (a) Be represented by counsel; and (b) Present evidence as to why the amusement gaming license should be granted; (6) If after the reconsideration meeting the applicant is dissatisfied with the recommendation of the Agency, the applicant may submit to the Commission, in writing: (a) A request for hearing before the Commission on the recommendation of the Agency; and (b) The applicant’s legal and factual bases for disagreeing with the recommendation of the Agency. (7) An applicant may submit a hearing request to the Commission within 15 days of the date of the recommendation of the Agency after the reconsideration meeting. (8) If an applicant fails to timely submit a hearing request under §B(6) of this Regulation, the Commission may adopt as final the recommendation of the Agency. (9) A hearing request that complies with §B(6) of this regulation shall be the subject of a hearing before the Commission under COMAR 36.01.02.06, after which the Commission shall: (a) Determine that the applicant is qualified and grant an amusement gaming license; or (b) Determine that the applicant is not qualified or disqualified; and (i) Deny the amusement gaming license; and (ii) Prepare an order denying the amusement gaming license with a statement of the reasons and specific findings of fact. (10) The applicant shall have the burden to show by clear and convincing evidence it is qualified to hold an amusement gaming license. (11) The Commission’s decision is final. C. A Commission hearing shall be conducted in the manner specified in: (1) State Government Article, Title 10, Subtitle 2, Annotated Code of Maryland; and (2) COMAR 36.01.02.06.