Poker machine entitlements

This page outlines:

• poker machine (also known as gaming machine) entitlements
• regional caps and city limits
• associated applications, and
• forfeiture.

Entitlements overview

Venue operators can only operate poker machines if they hold poker machine entitlements. Each poker machine entitlement allows a venue operator to operate one poker machine.

To operate poker machines, organisations must:

• hold a current venue operator’s licence
• hold poker machine entitlements
• have access to an approved premises.
  

*Note: venue operators can hold poker machine entitlements without an approved premises.

Venue operators must also:

• attach entitlements to approved premises to operate machines
• arrange poker machine equipment to be linked to the monitoring system
  
• employ staff with valid Gaming Industry Employee licences
• follow all legal and regulatory requirements.

Allocation breakdown for Victoria

There are currently 27,310 poker machine entitlements available to venue operators:

• 13,211 are allocated to club venue operators
• 14,099 are allocated to hotel venue operators.

Venue limits

The following rules apply in relation to limits per venue:

• No premises can exceed 105 poker machine entitlements
• Club venue operators can't hold more than 840 club poker machine entitlements
• No individual or organisation can have an interest in more than 35% of hotel poker machine entitlements
• 20% of poker machine entitlements must operate outside Metropolitan Melbourne.

Regional caps and city limits

There are distinct geographical guidelines within Victoria that define how many poker machine entitlements are allowed.

There are currently 25 capped regions and municipal (city) limits with uncapped regions. This does not include:

• Melbourne Central Business District
• Southbank, and
• Docklands precincts.

Please see Ministerial Order for more information.

If there's no violation of:

• regional caps
• city limits, or
• Ministerial Directions,

venue operators can then apply to:

• transfer poker machine entitlements between venue operators
• amend the geographic rules of poker machine entitlements
• extend the holding period of a poker machine entitlement.

All applications must be submitted via the Online Services Portal.

Visit the portal to submit applications for:

• Poker machine entitlements register (by licensee or region)
• Poker machine entitlements transfer register
• EOI: poker machine entitlements for sale
• EOI: poker machine entitlements wanted.

Transferring poker machine entitlements

There are 2 ways to transfer poker machine entitlements. They are:

1. When paying the outstanding entitlements balance to the Victorian Gambling and Casino Control Commission (VGCCC), or
2. When the buyer takes up the deferred repayments for entitlements. This happens by a deed of assumption

the VGCCC host the Entitlement Transfer Market (ETM) process. This allows venue operator licensees to:

• advertise
• monitor
• request the transfer of entitlements, or
• request amendments to entitlement conditions.

Whilst the VGCCC administers the poker machine entitlement transfer application via the Online Services Portal, this application is determined by the Minister via the Department.

Profit tax is payable on post-2022 entitlements transferred at a price higher than the allocation price. This is to prevent venue operators profiting from acquiring entitlements outside of the initial 2017 allocation process.

Profit tax for the seller:

• The tax is 100% of the difference between the price paid at allocation and the transfer price.

Profit tax for the buyer:

• The tax is 100% of the difference between the price that would have been paid at allocation, and the transfer price.

View the Determination of Poker Machine Entitlement Allocation and Transfer Rules.

Amend poker machine entitlements

Venue operators can apply for a change to:

• the geographic area, or
• venue conditions on their entitlement.

We will notify venue operators of their application outcome. If approved, we will update the entitlement register to reflect the changes and advise when this will take place.

Extending entitlement holding period

Venue operators holding poker machine entitlements must begin gaming:

• in an approved premises, and
• within the relevant holding period.

This is also referred to as the 'use it or lose it' rule.

We can extend the holding period of poker machine entitlements if:

• the circumstances are out of the entitlement holder's control.

Applications for this must be submitted before the holding period expires.

If you apply for a holding period extension after your holding period expires, the entitlements will be forfeited.

Poker machine entitlement forfeiture

Forfeiture is when poker machine entitlements are returned to the State. This is an automatic process that is triggered if:

• an application for a holding period extension is not submitted or expires
• the entitlement holder is no longer a licensed venue operator
• the entitlement holder has not followed payment requirements (as per the Entitlement Related Agreement).

If poker machine entitlements are forfeited, Venue operators must pay the State all amounts owing. This includes future payments for:

• entitlements,
• penalty interest, and
• prescribed fees.

If a venue operator automatically enters forfeiture but wants to have their entitlements reinstated, this requires an application to the Minister via the Department and does not involve the VGCCC.

Gaming entitlements taxation

Venue operators are responsible for paying gaming machine taxation. This means:

• tax payable will be calculated for each calendar month, and
• must be paid to us within 7 days of the month's end.

Monitoring

The State has awarded a Monitoring Licence to Intralot Gaming Services (IGS). IGS will provide the electronic monitoring system for all hotel and club poker machines in Victoria.

The Monitoring Licence also requires the data and information from poker machines for:

• regulatory
• taxation, and
• research purposes.

Additional services

Venue operators may contract additional service providers for services like:

• game analysis and conversions
• poker machine service, maintenance, and repairs
• player loyalty schemes and responsible gambling programs
• marketing advice, communications and venue promotions
• staff training and venue design
• financial advice.
  

We do not licence additional service providers or recommend any particular providers.

*Note: Venue operators must consider that additional providers can be found as:

• an associate of the licensee, and
• creating a legal connection under the ownership restrictions.

Venue operators should get their own legal advice before entering into agreements with additional services.

Venue management services

Examples of venue management services include:

• the service provider undertakes day-to-day venue management
• the service provider participating in decisions
• the decision-making for venue operator’s gaming business
• a dedicated manager providing to the venue
• the service provider making business decisions for a venue.

We do not licence venue management service providers or recommend any particular providers.

*Note: The nature of the agreement:

• may consider the provider an associate of the licensee, and
• may create a legal connection under the ownership restrictions.

Venue operators must consider that the venue management service provider, may become an associate of the venue operator’s licence.

In this situation, the agreement may require our approval.