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Delaware General AssemblyDelaware RegulationsMonthly Register of RegulationsSeptember 2014

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10 DE Admin. Code 206
Delaware Department of Finance, Office of the State Lottery, pursuant to 29 Delaware Code, Section 4826(c) is proposing to amend Regulations for the Delaware Lottery 10 DE Admin. Code 206 section 13.2 and 13.3, Internet Lottery.
Delaware Department of Finance ("Department"), Office of the State Lottery, pursuant to 29 Delaware Code, Section 4826 (29 Del.C. §4826) is proposing amendments to 10 DE Admin. Code 206 Section 13.2 and 13.3.
These regulations are authorized pursuant to 29 Del.C. §4826 of the Delaware Code. Internet lottery operations in the State of Delaware are strictly regulated by the Delaware State Lottery Office through the powers delegated to the Director of the Lottery pursuant to Title 29 of the Delaware Code.
"Agency" means the Delaware State Lottery Office created pursuant to 29 Del.C. Ch. 48.
"Agent" or "licensed agent" means any person licensed by the Director of the agency to conduct Internet lottery games including Internet ticket games, the Internet video lottery and Internet table games.
"Applicant" means any person applying for a license authorized under these regulations.
"Authorized game" means all lottery games in which the player’s interaction with the game occurs over the Internet including Internet ticket games, the Internet video lottery and Internet table games, and any variations or composites of such games, provided that such variations or composites are found by the Director to be suitable for use after an appropriate test or experimental period under such terms and conditions as the Director may deem appropriate. "Authorized game" may also include any other game which is determined by the Director to be compatible with the public interest and to be suitable for use after such appropriate test or experimental period as the Director may deem appropriate. "Authorized game" includes gaming tournaments in which players compete against one another in one or more of the games authorized herein if the tournaments are authorized by the Director.
"Background investigation" means the security, fitness and background checks conducted of an applicant.
"Business plan" means a document containing information regarding Internet lottery operations as may be required by the Director.
"Certification" means the authorization by the lottery in accordance with its inspection and approval process of Internet lottery games, such certification to relate to either hardware or software.
"DGE" means the Division of Gaming Enforcement of the Department of Safety and Homeland Security, as authorized by the Delaware Code.
"Director" means the Director of the Delaware State Lottery Office as established by Title 29 of the Delaware Code.
Game cycle” means all of the activities and communications over the duration of a game. A game cycle starts after the player account balance has adequate funds, the player has nominated the size of the wager to be placed on the game, and the player takes an action to initiate play. A single game cycle includes games which trigger a free game feature and any subsequent free games, bonus features, games with player choices, games where the rules permit the wagering of additional funds, and secondary game features, such as double up. A game cycle is considered complete when the final transfer of winnings to the player’s account takes place or when all funds wagered are lost.
"Gaming" means the operating, carrying on, maintaining or exposing for play any Internet lottery game.
"Gaming employee" means a person employed in the operation of an Internet lottery and determined by the Director to have employment duties and responsibilities involving the security, maintenance, servicing, repair, or operation of Internet lottery equipment, or is employed in a position that allows direct access to the internal workings of Internet lottery equipment. Such employees shall include, without limitation, Internet lottery IT staff, security and surveillance employees, and employees responsible for handling assets and proceeds associated with the operation of gaming activity.
"Gaming vendor" means any vendor offering goods or services relating to the manufacture, operation, maintenance, security, distribution, service or repair of Internet lottery equipment.
"Hearing officer" means a member of the Lottery Commission or other qualified person designated by the Chairperson of the Lottery Commission to conduct a hearing on any matter within the jurisdiction of the Lottery.
"Immediate family" means a person's spouse and any children, whether by marriage, adoption or natural relationship.
Internet lottery” means all lottery games in which the player’s interaction with the game operated by the agency occurs over the Internet (which, for the purposes of these regulations, shall include any public or private computer or terminal network, whether linked electronically, wirelessly, through optical networking technology or other means), including Internet ticket games, the Internet video lottery and Internet table games.
Internet table game” means a lottery game in which the player’s interaction with the game operated by the agency occurs over the Internet through a website or network of a video lottery agent, rather than at a table game in a video lottery facility, and in which the game is an Internet variation or compilation of a table game or table games, provided that the game is expressly authorized by rule of the Director.
Internet ticket game” means a lottery game in which the player’s interaction with the game operated by the agency occurs over the Internet through a website or network of the agency, and in which the winner is decided by chance through mechanical or electronic means, and which shall include keno but which shall not include the video lottery, table games, and other forms of the Internet lottery.
Internet video lottery” means a lottery game in which the player’s interaction with the game operated by the agency occurs over the Internet through a website or network of a video lottery agent, rather than at a video lottery machine in a video lottery facility, and in which the game is an Internet variation of a video lottery game, and which shall not include keno, table games, and other forms of the Internet lottery.
"Key employee" means a person employed in the operation of an Internet lottery and determined by the Director to be acting in a supervisory capacity or empowered to make discretionary decisions with respect to Internet lottery operations, including, without limitation, the chief executive, financial and operation managers, Internet lottery department managers, credit executives, or any other employee so designated by the Director for reasons consistent with the public policies of 29 Del.C. and shall include any officer or any employee of an employee organization who has direct involvement with or who exercises authority, discretion or influence in the representation of employees of a Delaware Internet lottery agent in collective bargaining, grievance representation, labor disputes, salaries, wages, rates of pay, hours of employment or conditions of work.
"License" means the authorization granted by the agency which permits an applicant to engage in defined Internet lottery activities as an agent or service company; and authorization granted by the agency which permits an applicant to perform employment duties as a key employee or gaming employee.
"License application" means the process by which a person requests licensing for participation in the Internet lottery operations.
"Licensee" means any person authorized by the Director to participate in Internet lottery operations.
"Lottery" means the public gaming system or games established and operated by the Delaware State Lottery Office.
"MICS" means Minimum Internal Control Standards as adopted by the Director.
Net internet table game proceeds" means the total amount of credits or cash played less chargebacks less the total amount of credits or cash won by the players less the amounts given away as free promotional play by the agent(s) which shall be within the limits as recommended by the Lottery Director and approved by the Secretary of Finance. "Net internet table game proceeds" does not include sums withheld from player winnings for tax liabilities incurred by the players, nor does it include amounts held in reserve for large or progressive prizes yet to be won by players. However, any interest earned on such amounts held in reserve is included in net internet table game proceeds.
Net internet video lottery game proceeds" means the total amount of credits or cash played less chargebacks less the total amount of credits or cash won by the players less the amounts given away as free promotional play by the agent(s) which shall be within the limits as recommended by the Lottery Director and approved by the Secretary of Finance. "Net internet video lottery game proceeds" does not include sums withheld from player winnings for tax liabilities incurred by the players, nor does it include amounts held in reserve for large or progressive prizes yet to be won by players. However, any interest earned on such amounts held in reserve is included in net internet video lottery game proceeds.
"Owner" means a person who owns, directly or indirectly, 10 percent or more of an applicant or licensee.
"Person" means an individual, general partnership, limited partnership, corporation or other legal entity.
"Player" means an individual who plays an Internet lottery game.
Poker revenue means the total value of rake and tournament fees charged to players at all poker tables pursuant to the approved rules of the game.
"Rake" means the percentage of the pot collected by the Internet table game system pursuant to the approved rules of the game as poker revenue.
Request for proposals and qualifications” means a document developed under the direction of the Delaware State Lottery Office for the purpose of soliciting responses from potential technology providers as a means of acquiring bids for goods or services.
Self excluded person” means any person whose name is included, at his or her request, on the self-exclusion list maintained by the Lottery Director or Deputy Director.
Self exclusion list” means a list of names of persons who have voluntarily agreed to be excluded from all Internet lotteries and to be prohibited from collecting any winnings or recovering any losses at all licensed Internet lottery agents.
Service employee” means a person employed in the operation of an Internet lottery and determined by the Director to have employment duties and responsibilities involving direct access to player and gaming information stored on Internet lottery equipment. Such employees shall include, without limitation, Internet lottery customer service staff, marketing and business intelligence employees, and employees responsible for handling player loyalty promotions.
Technology provider” means any person or entity who proposes to contract with an Internet lottery agent or the agency for the provision of goods or services related to an Internet lottery, the provision of which requires a license pursuant to 29 Del.C. Ch. 48.
Tournament fee means the entry fee collected by the internet table game system when players register for a poker tournament pursuant to the approved rules of the game as poker revenue.
4.9 If the Director proposes to deny a license application and the agency is subject to the requirements contained in subchapter IV of 29 Del.C. Ch. 101, the agency shall first give written notice to the applicant of the intended action, the reasons therefore, and the right to a hearing as provided for in 29 Del.C. Ch. 101.
4.12 Any license granted may not be transferred, assigned or pledged as collateral. A change of ownership which occurs after the Director has issued a license shall automatically terminate the license ninety (90) days thereafter. Provided, however, that the Director may issue a license to the new owner if satisfied, after the submission of an application that the new owner has met the requirements contained in 29 Del.C. §4806(a)(1-4), as well as the fitness and background standards contained in such law and these regulations. In the case of a death of an owner, the estate of such owner shall be deemed to have met the requirements of §4806(a)(1-4) for a period of one year following such death without the need for submitting an application, and, thereafter, need only supply such additional information as the Director may request. In the case of a shift in equity positions of owners, or a transfer among owners, notice shall be given the Director, but the license shall not terminate so long as no new owner is created or results. An agent may also seek approval of a proposed change in ownership prior to the actual change.
5.3.9 Require the applicant to provide a description of its risk management capabilities, engineering and software development resources, technical and maintenance support capabilities and ability to develop and deliver the Internet lottery system.
6.23 A service provider licensee shall immediately notify the agency of any change in officers, partners, directors, key employees, Delaware Internet lottery operations employees, or owners. These individuals shall also be subject to a background investigation. The failure of any of the above-mentioned individuals to satisfy a background investigation may be cause for the suspension or revocation of the service provider’s license.
7.13 All records pertaining to criminal background checks, pursuant to 29 Del.C. §4807A and copies of suitability determinations of applicants for licensure, shall be maintained in a confidential manner, including, but not limited to the following:
13.2 Regardless of location, pc and mac players may register to play for free by providing, at a minimum, the following:
13.3 Automated identity and age verification need not be performed for players registering to play for free. Only subsection 13.2.3 shall be required for players registering to play for free on a mobile device.
13.8 Players shall be permitted to have one active account at each Internet lottery agent provided the Internet lottery system employs a method of preventing inappropriate or fraudulent play resulting from an individual attempting to log on at more than one agent’s site at the same time.
"I am voluntarily requesting exclusion from all gaming activities at all licensed Delaware Video Lottery Agent locations and their Internet lottery sites because I am a problem gambler. I certify that the information provided above is true and accurate, and that I have read and understand and agree to the waiver and release included with this request for self-exclusion. I am aware that my signature below authorizes the Lottery and the DGE to direct all licensed Video Lottery Agents to prohibit my access to their premises and all Internet lottery sites in accordance with this request and unless I have requested to be excluded for life, until such time as the Lottery removes my name from the self-exclusion list in response to my written request to terminate my voluntary self-exclusion. I am aware and agree that during any period of self-exclusion, I shall not collect any winnings or recover any losses resulting from any gaming activity at all licensed Video Lottery Agent facilities and Internet lottery sites, and that any money or thing of value obtained by me from, or owed to me by a Video Lottery Agent as a result of wagers made by me while on the self-exclusion list shall be subject to forfeiture. I am aware that during my period of self-exclusion I will be denied access to any player club promotions, offers or memberships relating to video lottery and internet lottery activities. Note: any person whose name has been placed on the self-exclusion list, who thereafter knowingly enters a gaming area, is guilty of a Class A misdemeanor.”
13.26 Accounts shall be deemed inactive as specified in Title 29, Section 4826 (c)(4) of the Delaware Code.
13.27 Inactive accounts shall be treated according to the Title 12, Chapter 11, Subchapter II of the Delaware Code related to abandoned or unclaimed property.
18.12 Whoever violates the Lottery chapter 29 Del.C. Ch. 48, or any Lottery rule or regulation duly promulgated thereunder, or any condition of a license issued pursuant to 29 Del.C. §4826, or any Administrative Order issued in response to Lottery statutes or Regulations shall be punishable as follows:
18.12.1 If the violation has been completed, by a civil penalty imposed by Superior Court, which by 29 Del.C. §4823 shall have jurisdiction of civil penalty actions brought in response to this section, of not less than $1,000 nor more than $10,000 for each completed violation. Each day of a continued violation shall be considered as a separate violation if, on each such day, the violator has knowledge of the facts constituting the violation and knows or should know that such facts constitute or may constitute a violation. Lack of knowledge regarding such facts or violation shall not be a defense to a continued violation with respect to the first day of its occurrence.
18.12.4 In his discretion, the Director may try to obtain compliance with requirements of the Lottery chapter, 29 Del.C. Ch. 48, by written Administrative Order. Such order shall be provided to the responsible party, shall specify the complaint, and propose a time for correction of the violation. It may also provide an opportunity for a public hearing at which the Director shall hear and consider any submission relevant to the violation, corrective action, or the deadline for correcting the violation.
18.13 The Director shall enforce Ch. 48, 29 Delaware Code and any rules, regulations, or Administrative Orders issued thereunder.
18.14 Any interest, costs or expenses collected by the Lottery under actions instituted by 29 Del.C. §4823 or these regulations shall be appropriated to the State Lottery Office to carry out the purposes of 29 Del.C. Ch. 48.
Last Updated: December 31 1969 19:00:00.
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