[Federal Register Volume 77, Number 106 (Friday, June 1, 2012)]
[Proposed Rules]
[Pages 32465-32481]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-12992]


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DEPARTMENT OF THE INTERIOR

National Indian Gaming Commission

25 CFR Part 547

RIN 3141-AA27


Technical Standards

AGENCY: National Indian Gaming Commission.

ACTION: Proposed rule.

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SUMMARY: The National Indian Gaming Commission (NIGC) proposes to amend 
its technical standards to change the order of the first five sections; 
add definitions and amend existing definitions; amend the requirements 
concerning minimum odds for Class II games; amend standards for test 
labs; remove references to the Federal Communications Commission and 
Underwriters Laboratory; require a player interface to display a serial 
number and date of manufacture; amend requirements concerning approval 
of downloads to a Class II gaming system; establish mandatory tests for 
random number generators; amend the requirements for scaling algorithms 
and scaled numbers; and clarify the term ``alternate standard.''

DATES: The agency must receive comments on or before July 31, 2012.

ADDRESSES: You may submit comments by any one of the following methods, 
however, please note that comments sent by electronic mail are strongly 
encouraged.
     Email comments to: reg.review@nigc.gov.
     Mail comments to: National Indian Gaming Commission, 1441 
L Street NW., Suite 9100, Washington, DC 20005.
     Hand deliver comments to: 1441 L Street NW., Suite 9100, 
Washington, DC 20005.
     Fax comments to: National Indian Gaming Commission at 202-
632-0045.

FOR FURTHER INFORMATION CONTACT: National Indian Gaming Commission, 
1441 L Street NW., Suite 9100, Washington, DC 20005. Telephone: 202-
632-7009; email: reg.review@nigc.gov.

SUPPLEMENTARY INFORMATION: 

I. Comments Invited

    Interested parties are invited to participate in this proposed 
rulemaking by submitting such written data, views, or arguments as they 
may desire. Comments that provide the factual basis supporting the 
views and suggestions presented are particularly helpful in developing 
reasoned regulatory decisions on the proposal.

II. Background

    The Indian Gaming Regulatory Act (IGRA or Act), Public Law 100-497, 
25 U.S.C. 2701 et seq., was signed into law on October 17, 1988. The 
Act establishes the NIGC and sets out a comprehensive framework for the 
regulation of gaming on Indian lands. On October 8, 2008, the NIGC 
published a final rule in the Federal Register called Technical 
Standards for Electronic, Computer, or Other Technologic Aids Used in 
the Play of Class II Games. 73 FR 60508. The rule added a new part to 
the Commission's regulations establishing a process for ensuring the 
integrity of electronic Class II games and aids. The standards were

[[Page 32466]]

designed to assist tribal gaming regulatory authorities and operators 
with ensuring the integrity and security of Class II gaming, the 
accountability of Class II gaming revenue, and provide guidance to 
equipment manufacturers and distributors of Class II gaming systems. 
The standards do not classify which games are class II and which games 
are class III.
    On November 18, 2010, the NIGC issued a Notice of Inquiry and 
Notice of Consultation advising the public that the NIGC has endeavored 
to conduct a comprehensive review of its regulations and requesting 
public comment on which were most in need of revision, in what order 
the Commission should review its regulations, and the process NIGC 
should utilize to make revisions. 75 FR 70680. On April 4, 2011, after 
consulting with tribes and reviewing all comments, the NIGC published a 
Notice of Regulatory Review Schedule (NRR) setting out a consultation 
schedule and process for review. 76 FR 18457. Part 547 was included in 
the third regulatory group reviewed pursuant to the NRR.

III. Development of the Proposed Rule

    On July 8, 2011, the Commission began a series of tribal 
consultations on part 547. Based in part on the recommendations to the 
Commission during consultations, on August 10, 2011, the Commission 
requested tribes to nominate tribal representatives to serve on a 
Tribal Advisory Committee (TAC) to assist the Commission in drafting 
changes to parts 543 and these technical standards. The Commission then 
selected fifteen tribal representatives. The members of the TAC include 
a diverse group of regulators, tribal leaders, and subject matter 
experts.
    Beginning on October 20, 2011, the TAC held four meetings in which 
the Commission participated. All of the meetings were open to the 
public and three of the four were transcribed. Those transcripts can be 
viewed on the NIGC's Web site. During the meetings, the TAC and NIGC 
discussed all aspects of the technical standards, with the NIGC 
participating and providing assistance. As a result of those meetings 
the TAC submitted a proposed part 547 regulation to the Commission.
    The Commission appreciates the TAC's deliberation and work product, 
which consisted of the TAC's proposed part 547. Upon reviewing the 
TAC's recommendation, and taking into consideration comments received 
through tribal consultations, the Commission published a discussion 
draft of the amended technical standards on its Web site. The 
discussion draft adopted a number of the TAC's recommendations, such as 
moving requirements that more appropriately belong to the Minimum 
Internal Control Standards found at 25 CFR part 543.
    After publishing the discussion draft, the Commission conducted 
consultations in Mayetta, KS and San Diego, CA. In addition to tribal 
consultations, the Commission requested public comment on the 
discussion draft. The consultations, combined with the written 
comments, have proven invaluable to the Commission as it addresses the 
NIGC's technical standards.
    While the comments were generally supportive of the discussion 
draft, comments indicated several specific areas of concern. After 
considering the comments received, the Commission proposes the 
following amendments to the part 547 technical standards.

A. General Comments

    One commenter requested clarification of the NIGC's authority to 
implement these standards and its authority to enforce the standards. 
IGRA gives the Commission the authority to adopt these technical 
standards. Congress was expressly concerned that gaming under IGRA be 
``conducted fairly and honestly by both the operator and players'' and 
``to ensure that the Indian tribe is the primary beneficiary of the 
gaming operation.'' 25 U.S.C. 2702(2). The technical standards are 
designed to ensure that these concerns are addressed. These standards 
implement the authority granted the Commission to monitor, inspect, and 
examine Class II gaming, 25 U.S.C. 2706(b)(1)-(4), and to promulgate 
such regulations as it deems appropriate to implement the provisions of 
IGRA. 25 U.S.C. 2706(b)(10).
    Another commenter asked the Commission to make clear that tribal 
facilities cannot engage in gambling activities that are illegal under 
state law. The Commission declines to do so. A tribe may engage in 
Class II gaming on Indian lands within its jurisdiction if the gaming 
is located within a state that permits such gaming for any purpose, by 
any person, organization or entity, and the tribe adopts a gaming 
ordinance approved by the NIGC Chair. 25 U.S.C. 2710(b)(1). So long as 
a state permits the game of bingo, regardless of the state's definition 
of the game, an Indian tribe within that state may also play bingo as 
defined in IGRA. Accordingly, tribes are not bound to state definitions 
of the game of bingo. If, for example, a state permits paper bingo 
only, a tribe within that state may play electronic bingo so long as it 
otherwise meets IGRA's Class II gaming definition. The Commission 
reiterates that this rule does not classify games for purposes of IGRA. 
The rule assumes that the games played are Class II games. This rule 
establishes a process for ensuring the integrity and security of Class 
II games and an accounting of Class II revenue.

B. Regulation Organization

    Sections 547.2 through 547.5 of the current regulation have been 
reorganized for clarity. The Definitions section has been moved from 
Sec.  547.3 to Sec.  547.2. Section 547.3 of the proposed rule has been 
renamed, Who is responsible for implementing these standards?, and 
incorporates provisions from Sec. Sec.  547.2 and 547.5 of the current 
regulation. Section 547.4 of the proposed rule is titled What are the 
rules of general application for this part?, and was moved from Sec.  
547.5 of the current regulation. Finally, Sec.  547.5 of the proposed 
rule, How does a tribal government or TGRA comply with this part?, was 
moved from 547.4 of the current regulation. The NIGC included these 
changes in the discussion draft and received no comments supporting or 
opposing these changes.
    One commenter, however, asserted that the order of later sections 
is confusing and recommended that the Commission change the part to the 
following order: Hardware, Software, System Components, Installation/
Downloading, and, finally, Grandfathering. The Commission declines to 
adopt this suggestion. The Commission believes that the regulation is 
clear as currently arranged.
    A commenter also took issue with the use of the word wager, 
suggesting that the term purchase or sale be used instead. The 
Commission declines to adopt this recommendation. The terms sale and 
purchase do not adequately address Class II games outside of bingo, 
while wager encompasses all Class II gaming.

C. Definitions

    This proposed rule adds definitions to Sec.  547.2 and proposes 
amendments to a number of existing definitions. Some changes were first 
proposed in the discussion draft, while others are proposed based on 
comments received on the discussion draft. The discussion draft 
suggested adding definitions for Patron and Proprietary Class II System 
Component. The Commission received no comments on the definition of 
Patron, which was carried over to this proposed rule. Several 
commenters, however, urged the Commission to remove the definition of 
Proprietary

[[Page 32467]]

Class II System Component on the grounds that the term is not used 
elsewhere in part 547.
    The Commission agrees with the commenters and has removed the 
definition of Proprietary Class II System Component. The intended 
purpose of the definition was to distinguish the common back of the 
house component systems that communicate with all of the Class II 
gaming systems, regardless of the manufacturer, from those components 
that work exclusively with one manufacturer's Class II system. On 
review of the standards, the Commission has concluded that this 
definition is not necessary and has led to confusion. Therefore, it is 
not included in the proposed rule. For the same reasons, the Commission 
has not included the word proprietary in the definitions of Cashless 
system and Voucher system.
    Several commenters also suggested that the Commission revise the 
definition of Reflexive software to clarify that the harm with such 
software is the denial of a prize to which the player is otherwise 
entitled based on the random outcome of the game. The Commission 
declines to revise the definition in this way. Although the denial of a 
prize is one harm associated with reflexive software, the definition of 
Reflexive software is also concerned with the potential manipulation of 
the outcome of a game to award a prize.
    Commenters also recommended that the Commission amend the 
definition of Agent to permit the use of computer applications to 
perform the function(s) of an agent. The proposed rule does not include 
this proposed amendment. The term ``computer applications'' is 
undefined and potentially broad. Any hardware that is under the control 
of an agent is exempt from the testing requirements of this part, and 
thus amending the definition of Agent in this manner potentially would 
exempt hardware that is subject to testing requirements such as 
financial instrument acceptors, financial instrument dispensers, etc.
    In response to other comments, the Commission has added definitions 
for Advertised top prize, Audit mode, Enroll, and Unenroll. The 
Commission has also reinserted the definition of Electrostatic 
discharge and, at the suggestion of one commenter, amended the 
definition of Electromagnetic interference.

D. Who is responsible for implementing these standards?

    As with the discussion draft, Sec.  547.3 of the proposed rule has 
been renamed and incorporates provisions that were previously located 
in other sections.
    Several commenters advocate changing Sec.  547.3(a) to reflect that 
TGRAs are the primary regulators of Indian Gaming. The comments stated 
that the current language recognizing that TGRAs ``also regulate Class 
II gaming'' is inconsistent with IGRA and NIGC statements. As support, 
the commenters point to 25 U.S.C. 2701(5), which states that ``Indian 
tribes have the exclusive right to regulate gaming activity on Indian 
lands * * *.'' The commenters also note that the NIGC has repeatedly 
recognized that tribes are the primary regulators of Indian gaming in 
the preamble to the current regulation.
    The commenters are correct that tribes are the primary regulators 
of Indian gaming. The Commission has never understood that to mean, 
however, that the regulatory authority of a TGRA is superior to that of 
the NIGC. Rather, the Commission recognizes that TGRAs are the day-to-
day regulators of Indian gaming and the first line of oversight at 
every facility. Although the findings section of IGRA states that 
tribes have the exclusive right to regulate gaming activity on Indian 
lands, IGRA also establishes a regulatory scheme that includes the NIGC 
as well as tribes.
    Another commenter suggested adding a provision that ``nothing in 
this part is intended to diminish TGRA authority.'' The Commission did 
not adopt this recommendation. The Commission believes that the 
standards clearly state that a TGRA is free to implement stricter 
standards than those found in this part. It may not, however, implement 
standards that are less stringent than those found here.
    Many commenters expressed confusion over Sec.  547.3(c). This 
section makes clear that, if a provision of part 547 is applicable to a 
facility's Class II gaming system, the Class II gaming system must 
comply with that provision. Inversely, a Class II gaming system does 
not need to meet standards that do not apply to the system. The first 
sentence of the sub-section states that ``gaming equipment and software 
used with Class II gaming systems must meet all applicable requirements 
of this part.'' As an example, the second sentence clarifies that if a 
Class II gaming system lacks the ability to print or accept vouchers, 
any standards governing vouchers do not apply. Commenters noted that 
this provision is clear when the two sentences are read together, but 
confusing when read separately.
    The Commission believes that the provision is understandable as 
written and informs the public that this provision, as well as the rest 
of the regulation, must be read as a whole, rather than piecemeal. As 
the comments mentioned, when read in context, the provision is 
understandable. The proposed rule, therefore, does not include this 
recommended change.
    Another commenter asked that the Commission amend the regulation to 
clarify that these standards do or do not apply to various specific 
types of games. The Commission declines to do so, as it believes that 
Sec.  547.3(c) makes clear that the regulated community need only 
adhere to those standards that apply to a Class II gaming system.

E. Minimum Odds

    The discussion draft amended the minimum odds requirement found in 
Sec.  547.5(c) of the current regulation. Instead of requiring minimum 
odds, the discussion draft, at Sec.  547.16, required the system 
display a disclaimer notifying the patron if the odds of winning a game 
exceed 100 million to one.
    Several commenters supported the discussion draft's approach of 
removing the minimum odds requirement, but were unanimous in 
recommending against requiring the odds notification added to Sec.  
547.16. Some commenters stated that the provision is unnecessary, as 
the standards already require the facility to display game rules and 
prize schedules. Others objected to the requirement on the grounds that 
it will create an unfair market advantage for games that do not need to 
display the notice. Another commenter suggested that the odds 
notification requirement will make all existing Class II gaming systems 
non-compliant because no existing player interface conforms to this 
requirement. One commenter submitted that the notice serves no purpose 
because it does not actually inform the patron of anything. Another 
commenter, though in opposition to the requirement generally, 
recommended that the disclaimer be moved to the help screen.
    The proposed rule includes a modified version of the notification 
requirement. The notification need not be continually displayed and 
may, for example, be included on the help screen or with the rules and 
prize schedule for the game. The Commission included the requirement 
primarily out of fairness to the player. Although one commenter 
suggested that the notification does not actually tell the player 
anything, the Commission disagrees. The notification informs the player 
that the odds of winning a top prize exceed 100 million to one. The 
Commission rejects the argument that requiring the odds notification 
will render all Class II

[[Page 32468]]

gaming systems non-compliant. Currently, no Class II game is permitted 
to have odds greater than 100 million to 1. Therefore, that provision 
should not apply to any Class II games in the marketplace currently.
    Finally, Sec.  547.4 of the proposed rule requires the test lab 
certifying the game to calculate and/or verify mathematical 
expectations and report its calculations to the TGRA. At the request of 
the TGRA, the manufacturer must also submit mathematical expectations 
to TGRA. This requirement was part of the discussion draft, and the 
comments received support its inclusion.

F. Approval and Game Function

    Section 547.4(b) of the proposed rule requires that all gaming 
equipment and software operated at a facility be identical to that 
tested by a test lab and approved by the TGRA. Some commenters 
recommended removing the requirement that ``unapproved software must 
not be loaded onto or stored on any program storage medium used in a 
class II gaming system * * *.'' The commenters suggested that this 
provision is a control standard better located in the Class II Minimum 
Internal Control Standards found at 25 CFR part 543. The Commission 
agrees and has moved the requirement from the proposed technical 
standards, and has included it in proposed amendments to part 543.
    Commenters also suggested the Commission review Sec.  547.4(c). The 
section requires that all Class II gaming systems perform according to 
the manufacturer's design and operating specifications. The commenter 
noted that the provision is odd, as there is no requirement that a 
manufacturer submit this information to the TGRA or test lab.
    The Commission declines to remove the requirement. The Commission 
realizes that no other section of these standards requires a 
manufacturer to submit the operating and design specifications. 
However, the purpose of the section is to affirm the TGRA's authority 
to ensure that the Class II gaming system operates as the manufacturer 
represents. This provision provides an additional basis for a TGRA to 
require this information.

G. Grandfathered Games

    When implemented in 2008, the part 547 technical standards 
introduced several new requirements for Class II gaming systems 
designed to protect the security and integrity of Class II gaming 
systems and tribal operations. The Commission understood, however, that 
some existing Class II gaming systems might not meet all of the 
requirements of the technical standards. Therefore, to avoid any 
potentially significant economic and practical consequences of 
requiring immediate compliance, the Commission implemented a five-year 
``grandfather period'' for eligible gaming systems. The Commission 
believed that a five year period was sufficient for market forces to 
move equipment toward compliance with the standards.
    To qualify as a grandfathered game pursuant to the current 
regulations, a gaming system must have been submitted to a testing 
laboratory within 120 days of November 10, 2008. The testing laboratory 
must have then reviewed the gaming system for compliance with a 
specific, minimum set of requirements, and have issued a report to the 
applicable TGRA, which must have then approved the gaming system for 
grandfather status. At the end of the five year period--November 10, 
2013--the grandfathered systems must be brought in to compliance with 
the requirements of Part 547 or removed from play.
    The Commission received several comments on the grandfathering 
provisions, the majority of which focused on the five year duration. 
Many comments suggested that the Commission remove the five year 
clause, effectively creating a permanent class of grandfathered games. 
Comments reasoned that making no amendments to the current regulation 
would cause economic hardship to some tribes, although the Commission 
received no specific information indicating what, if any, economic 
hardship tribes would incur.
    This proposed rule does not include any substantive changes to the 
grandfathering provisions because the comments received by the 
Commission on the preliminary draft did not provide facts to support 
any change to this section. The Commission invites comment that 
provides data and the factual basis supporting the views and 
suggestions regarding the grandfathering provisions. For example, the 
Commission requests specific information on what provisions in part 
547, if any, prevent compliance for current grandfathered Class II 
gaming systems, and why? Such information is particularly helpful in 
developing reasoned regulatory decisions.
    Although the proposed rule does not include any substantive changes 
to the grandfathering provisions, the Commission is considering whether 
substantive amendments are appropriate. Based on information received 
during this comment period, the Commission may issue a final rule that 
amends all or parts of the grandfathering provisions as described 
below. Therefore, the Commission requests the public to provide 
specific facts and information relating to the following potential 
changes to the provision, views on which approach will best maintain 
the integrity of Indian gaming, and, specifically, answers to the 
questions below:
    Duration of the ``sunset clause.'' The Commission is considering 
amending the duration of the grandfather provision in Sec.  547.4(b)(1) 
by extending the period for an additional three to five years or 
removing the period. In order to make a well-informed, considered 
decision, the Commission requests the public to provide responses to 
the following questions:
    1. How many Class II gaming systems will be affected if the current 
date of November 10, 2013 is extended or eliminated?
    2. What would be the regulatory and other impacts of extending the 
period by three to five years past November 10, 2013?
    The 120-day deadline to submit to a testing lab. The Commission is 
considering amending the 120-day submission period in Sec.  547.4(a)(1) 
by allowing a limited submission period for those systems that did not 
meet the original 120-day deadline for submission of the gaming system 
to the lab.
    1. How many Class II gaming systems could be potentially submitted 
to labs if the 120-day period is modified?
    2. What would be the regulatory and other impacts of allowing a 
limited submission period for those systems that did not meet the 
original deadline?
    Modifications. The Commission is considering amending the section 
by eliminating the five year period in Sec.  547.4(b)(1) and instead 
requiring that all future repairs, replacements, and modifications to 
current grandfathered Class II gaming systems be fully compliant with 
the standards established in part 547.
    1. If part 547 were amended in this fashion to apply only to all 
modifications, what specific impacts would the amendment have on tribal 
gaming operations?
    2. If part 547 were amended in this fashion to apply to all 
repairs, replacements and modifications to grandfathered Class II 
gaming systems, what specific impacts would the amendment have on 
tribal gaming operations?
    Comments also suggested that placing a sunset period on 
grandfathered systems would invalidate federal court decisions 
sanctioning the games. The commenters have not cited to any

[[Page 32469]]

particular cases in support of this comment and, as a result, the 
Commission cannot directly address any decisions or arguments alluded 
to in the comments. However, the Commission notes that this provision 
does not bear on the classification of a game as Class II or Class III. 
The provision requires only that, for any Class II game to be available 
for play, the game must have been certified as a grandfathered Class II 
gaming system or comply with the standards in part 547, and that 
systems must comply with all standards in Part 547 by November 10, 
2013.
    In addition, comments stated that protection of grandfathered 
systems is necessary as part of compact negotiations. The Commission 
understands that Class II games are an important component of Indian 
gaming. However, part 547 is designed to protect the security and 
integrity of Class II gaming.
    Commenters also expressed concern over the discussion draft's 
inclusion of the phrase, ``available for use at any tribal gaming 
facility'' in Sec.  547.5(a). Commenters read the provision to require 
that a grandfathered system must have been available for use on or 
before November 10, 2008. This interpretation was not intended by the 
Commission. The section was meant to convey that before any Class II 
gaming system manufactured prior to November 10, 2008, may be made 
available for use, it must meet the grandfathering requirements. The 
Commission has amended the provision accordingly.
    In response to this comment, the Commission also revisited the 
section's requirement that the Class II gaming system must have been 
manufactured or placed in a tribal gaming facility before November 10, 
2008. The Commission realizes that the application of the requirement 
to systems that were manufactured prior to November 10, 2008 will 
necessarily include those games that were placed in a tribal facility, 
and has thus changed the section.
    Other comments noted that the discussion draft's grandfathering 
provision creates a catch-22 by requiring software systems to have been 
submitted for certification based on new standards contained in this 
draft. The Commission recognizes that the discussion draft's 
requirement that grandfathered systems have the ability to enable or 
disable remote access created a new standard and, as a result, may 
disqualify a previously properly certified grandfathered system. The 
provision has, accordingly, not been included in the proposed rule. 
Under this proposed rule, any game that was certified as grandfathered 
based on the requirements in the current 547 remains certified.
    This change also resolves comments recommending that the Commission 
insert language clarifying that nothing in the rule is intended to 
prohibit the continued use of any Class II gaming component that was 
previously certified against the grandfather provisions or judicial 
ruling. If a component was grandfathered, it may be used pursuant to 
the grandfathering provisions found in this proposed rule. The 
Commission, therefore, declines to include the recommended language.
    Further, comments have suggested that a requirement that a test lab 
certify compliance with ``any applicable federal laws and regulations'' 
is too inclusive. According to the commenters, it would not be feasible 
for a testing laboratory to review all federal laws and regulations to 
determine which ones are applicable.
    The Commission agrees with the comment, and believes that a TGRA is 
in the best position to ensure compliance with federal regulations that 
apply to its gaming systems. As a result, the proposed rule includes a 
provision to require a test lab to note compliance with any standard 
established by the TGRA. The Commission encourages TGRAs to use this 
provision to ensure compliance with federal standards that apply to 
their Class II game systems, but fall outside of the NIGC's purview.
    Other commenters have expressed concern that a rule incorporating 
the discussion draft's provisions will require re-certification of 
otherwise compliant systems. Because the proposed rule does not make 
any substantive changes to the grandfather provisions, any system 
compliant with the existing part 547 will also meet the standards 
outlined in this proposed rule.

H. Testing Laboratories

    Section 547.5(f) of the discussion draft permitted a testing 
laboratory to provide the testing and certification required by the 
standards even if owned by, or affiliated with, a tribe, so long as it 
is independent from the manufacturer and gaming operator for whom it is 
providing testing. Comments on this change were overwhelmingly 
supportive. One commenter, though, suggested that this change creates 
the perceived risk of a conflict of interest and recommended no 
amendment to this section.
    The proposed rule includes the amendment. The Commission believes 
that any perceived risk is mitigated by the section's requirement that 
the tribally-owned or affiliated test laboratory be independent from 
the manufacturer and gaming operator for whom it is providing testing.
    The discussion draft also amended Sec.  547.7 of the current 
regulation requiring certifications from Underwriter's Laboratory (UL) 
or its equivalent regarding liquid spills, electromagnetic 
interference, etc. The discussion draft added a provision at Sec.  
547.5(c)(4) requiring a testing laboratory's report to certify that the 
operation of each interface will not be affected by electrostatic 
discharge, liquid spills, electromagnetic interference, radio frequency 
interference, or any other risk identified by the TGRA.
    Comments regarding this change were generally positive. In 
expressing support for the removal of the UL reference, a few 
commenters noted that the establishment and enforcement of electrical 
product safety standards falls within the authority of tribal 
governments. Another comment claimed that the NIGC is not authorized to 
establish or enforce electrical safety standards and questioned the 
propriety of an agency specifying a particular laboratory to conduct 
such testing.
    The Commission appreciates support for the removal of the reference 
to UL and has kept the new language, with few changes, in this proposed 
rule. The Commission notes, however, that the provision still requires 
player interfaces to be tested to ensure that they will not be 
compromised or affected by listed events and conditions. Rather than 
requiring that the test lab itself perform the test and certify the 
Class II gaming system, the proposed rule instead requires the test lab 
to confirm that the system has been certified.
    Another commenter submitted that it is not clear that a testing 
laboratory can ``certify'' that the player interface will not be 
compromised by ``any other risk identified by the TGRA.'' The NIGC 
agrees and the amendment proposes that the test laboratory must confirm 
that each player interface was certified pursuant to any other tests 
required by the TGRA.

I. Player Interface

    Section 547.7(d) of the discussion draft added a requirement that 
the player interface display the serial number and date of manufacture. 
Several commenters suggested that use of the word ``display'' is 
confusing and the provision should be changed to require the player 
interface to ``bear'' the serial number and date of manufacture. The 
Commission agrees that, when used in the context of a Class II gaming

[[Page 32470]]

system, the word ``display'' could be understood to require the game 
screen to show the information, rather than merely to require the 
information to be located somewhere on the player interface. Therefore, 
the Commission has changed Sec.  547.7(d) to require that the player 
interface ``must be labeled with the serial number and date of 
manufacture * * * .'' The Commission also notes that this change will 
be consistent with Sec.  547.5(b)(6) of this proposed rule.
    Another commenter urged the Commission to add a provision to Sec.  
547.7(k) specifying that ``nothing herein must prohibit or limit the 
technology utilized to run Class II gaming systems.'' The Commission 
believes that Sec.  547.3(b) already makes this intent clear and, as 
such, declines to incorporate this comment.

J. Game Initiation and Play

    Section 547.8(b) of the discussion draft requires a Class II gaming 
system follow and not deviate from a constant set of rules for each 
game. The provision also prohibits any automatic or undisclosed rule 
changes. Several commenters recommended eliminating the words 
``automatic or.'' The Commission respectfully disagrees. Any rule 
should be disclosed to the patron prior to initiation of game play, and 
any rule change to the game must be disclosed to the patron. This 
section, combined with Sec.  547.16(a), ensures that the constancy of 
game rules for all game features, including any bonus features.
    Comments suggested that the requirement in Sec.  547.8(b) that a 
player ``choose to participate in the play of a game,'' is vague, not a 
technical standard, and cannot be tested. The Commission agrees that 
this provision is not clear. The intent is to require that the player 
initiates game play. To clarify, the Commission changed the provision 
to read, ``[n]o game play may commence unless initiated by a player.''

K. Entertaining Display

    Section 547.8 of the current technical standards contains certain 
requirements regarding the entertaining displays. Section 
547.8(a)(2)(ii) requires that, between plays of any game, or until a 
new game option is selected, the player interface must display the 
final results for the last game, including the entertaining display. 
Section 547.8(d)(2), meanwhile, requires entertaining display be 
included in the last game recall.
    The discussion draft removed references to entertaining displays 
from both of these sections. Nearly all of the comments expressed 
support for the change. Comments focused on the fact that the 
entertaining display has no significance to the outcome of the game. A 
few commenters, however, opposed this change.
    One commenter suggested that the revision to 547.8(a)(2)(ii) would 
require the game display to ``go blank'' in between games. The 
Commission respectfully disagrees. The standard, as proposed, does not 
require a blank screen. It still requires the player interface to 
display the wager amount and all prizes and total credits won during 
the last game played, the final results of the last game played, and 
any default purchase or wager amount for the next play.
    Some commenters also objected to the discussion draft no longer 
requiring last game recall to include the entertaining display. The 
commenter noted that when a pay-table on a player interface indicates 
that certain combinations of symbols will result in certain prizes, a 
player has a reasonable right to expect a prize if that combination of 
symbols appears on the pay line of the ``entertainment only'' display. 
The commenter asserts that if a game posts a prize schedule 
corresponding to the entertaining display instead of, or in addition 
to, the bingo card, and a prize paying combination of symbols appears 
in the entertaining display but no prizes are awarded, the integrity of 
the gaming system and reputation of the tribe may be called into 
question.
    The Commission agrees that the reputation of an operation is of 
utmost importance and can reach beyond a particular facility to bolster 
or harm the reputation of Indian gaming. However, the Commission 
respectfully disagrees. The game of bingo is dictated by the ball draw 
and the bingo card, not the entertaining display. This is made clear by 
the disclaimer required by Sec.  547.16 clarifying that actual prizes 
are determined by bingo play not the entertaining display. For the 
technical standards to require last game recall to include the 
entertaining display would incorrectly emphasize an aspect of the game 
that has no bearing on its outcome.
    The Commission also disagrees with the commenter's assessment that 
if the entertaining display indicates a win, the patron should be paid 
regardless of the bingo results. Prizes should only be awarded on Class 
II electronic bingo games if the patron has won according to the bingo 
card.

L. Game Interruption and Resumption

    The current technical standards and the discussion draft require 
that if a Class II gaming system is interrupted, it can, upon 
resumption, return to a known state; check for any fault condition; 
verify the integrity of data stored in critical memory; return the 
purchase or wager amount to the player in accordance with the rules of 
the game; and detect any change or corruption in the Class II gaming 
system software.
    One commenter stated that many of the requirements cannot be 
accomplished by Class II gaming systems. The Commission disagrees. 
Class II gaming systems can meet this standard. Further, the Commission 
notes that this has been a requirement since the current regulation 
went into effect in 2008 and all Class II gaming systems, with the 
exception of grandfathered systems, should already meet this 
requirement.

M. Accounting Functions

    Section 547.9 of the discussion draft requires the Class II gaming 
system be capable of tracking minimum accounting data. As part of this 
requirement, each type of financial instrument accepted and paid by the 
Class II gaming system must be tracked according to applicable 
Commission and TGRA regulations governing minimum internal control 
standards. Some commenters pointed out that the TGRA requirements will 
necessarily include the Commission's minimum internal control standards 
and, as such, the references to the Commission should be deleted. The 
Commission agrees and has changed the section accordingly.

N. Critical Events

    Section 547.10 of the current regulation and the discussion draft 
lists several types of fault events that must be recorded by the Class 
II gaming system. One commenter suggests that ``financial storage 
component full'' notification cannot be reported unless an operation is 
using ``smart cans'' with the Class II gaming system. The commenter 
recommends the standard be deleted, as requiring compliance would be 
costly and there is no risk associated with a can being full.
    The Commission declines to adopt this recommendation. The 
Commission notes that this has been a requirement since the current 
technical standards went into effect in 2008, and all Class II gaming 
systems, with the exception of grandfathered systems, should already 
meet this standard.

O. Download Approval

    This proposed rule removes the requirement from Sec.  547.12 that 
the TGRA authorize all downloads by a

[[Page 32471]]

Class II gaming system. This change was first made in the discussion 
draft and many commenters requested clarification that nothing 
prohibits the TGRA from maintaining the download approval requirement. 
As stated in 547.3(a), the Commission recognizes that the TGRA 
regulates technical standards and, accordingly, may implement stricter 
standards. Nothing in this section prohibits the TGRA from requiring 
its approval of downloads.

P. Scaling Algorithm

    Section 547.14 of the current regulation requires that a random 
number generator (RNG) that provides output scaled to given ranges must 
use an unbiased algorithm. According to the regulation, a scaling 
algorithm is unbiased if the measured bias is no greater than 1 in 100 
million. The discussion draft changed this requirement to require the 
RNG to use an unbiased algorithm and report any bias to the TGRA. The 
proposed rule includes this amendment. A few commenters propose re-
inserting a range for measured bias on the grounds that requiring any 
bias to be reported could be an unworkable standard, but do not explain 
why the proposed standard is unworkable.
    The Commission also notes that the measured bias of 1 in 100 
million proved unworkable and required the Commission to issue bulletin 
number 2008-4 clarifying that the threshold for reporting a bias should 
instead be 1 in 50 million. The Commission, therefore, declines to 
implement the suggested comment in this proposed rule and asks 
commenters to be more specific as to why the requirement to report any 
bias is unworkable. The Commission further asks for comments on what 
would be a workable threshold.

Q. Disclaimers

    Section 547.16(b) of the current regulation requires the Class II 
gaming system to continuously display two disclaimers--first, that 
malfunctions void all prizes and plays and the prizes are determined by 
bingo play and second, that any other display is for entertainment 
purposes only. Although the discussion draft maintained this 
requirement, the proposed rule now requires the ``player interface,'' 
rather than the ``Class II gaming system'' to display the disclaimers.
    A few commenters suggested that the Commission should clarify that 
this change is not intended to require that the disclaimers be 
displayed on the video screen. The Commission agrees. The standard 
requires only that the player interface, which is defined by this part, 
display the disclaimer, not any specific part of the interface. So long 
as the disclaimer is located in a place that can be clearly seen by the 
public, as this standard clearly intends, it can be located anywhere 
the interface that the TGRA allows.
    Another commenter suggests that the ``continually display'' 
requirement presents a hardship, as it takes up space on smaller 
devices such as bingo minders. The commenter also notes that the 
requirement will become wholly unworkable as technology advances to the 
point where participants are able to use their own technology, such as 
a cell phone, in the play of the game.
    The Commission declines to incorporate this suggestion into the 
proposed rule. As recognized by recommended drafts submitted to the 
NIGC, including that presented by the TAC, the disclaimers are of 
critical importance, and, therefore, the Commission believes that it is 
necessary that they be displayed somewhere on the player interface at 
all times.

R. Alternate Standards

    Finally, the discussion draft made minor changes to Sec.  547.17. 
Although the overall purpose of the section is the same, the discussion 
draft uses the term ``alternate standard'' rather than ``variance.'' 
The Commission believes that ``alternate standard'' more accurately 
reflects the activity covered by the standard. The change is also 
consistent with the proposed part 543 minimum internal control 
standards, which also uses ``alternate standard'' rather than 
``variance.''
    Although commenters were unanimously supportive of the change, a 
few asked that the standard be changed to clarify that the TGRA can 
implement the alternate standard as soon as it is approved by the TGRA. 
Section 547.17(b)(4) of the discussion draft and this proposed rule 
prohibit an alternate standard from being implemented until ``it has 
been approved by the TGRA * * * or the Chair * * *.'' The Commission 
believes that this language makes clear that an alternate standard may 
be implemented upon TGRA approval and declines to change the section 
further.
    Another commenter suggested clarifying the Sec.  547.17(a)(2)(ii) 
requirement that a TGRA submit to the Chair, ``the alternate standard 
as granted and the record on which it is based.'' The Commission 
intended this section to require the record upon which the approval is 
based and has changed the language accordingly.
    One commenter also suggested finding a compromise between a 
standard that allows a TGRA to submit an approved standard for NIGC 
comment, and the discussion draft standard, which required the 
alternate standard be submitted for NIGC approval.
    Although TGRAs have the authority to implement stricter standards, 
these are NIGC's minimum standards. Any alternate standard, therefore, 
must be approved by the NIGC. A TGRA may still approve a standard in 
its TICS that is, at a minimum, as strict as these standards.

Regulatory Matters

Regulatory Flexibility Act

    The proposed rule will not have a significant impact on a 
substantial number of small entities as defined under the Regulatory 
Flexibility Act, 5 U.S.C. 601, et seq. Moreover, Indian Tribes are not 
considered to be small entities for the purposes of the Regulatory 
Flexibility Act.
Small Business Regulatory Enforcement Fairness Act
    The proposed rule is not a major rule under 5 U.S.C. 804(2), the 
Small Business Regulatory Enforcement Fairness Act. The rule does not 
have an effect on the economy of $100 million or more. The rule will 
not cause a major increase in costs or prices for consumers, individual 
industries, Federal, State, local government agencies or geographic 
regions. Nor will the proposed rule have a significant adverse effect 
on competition, employment, investment, productivity, innovation, or 
the ability of the enterprises, to compete with foreign based 
enterprises.

 Unfunded Mandate Reform Act

    The Commission, as an independent regulatory agency, is exempt from 
compliance with the Unfunded Mandates Reform Act, 2 U.S.C. 1502(1); 2 
U.S.C. 658(1).
Takings
    In accordance with Executive Order 12630, the Commission has 
determined that the 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 Commission has 
determined that the proposed rule does not unduly burden the judicial 
system and meets the requirements of Sec.  3(a) and 3(b)(2) of the 
Order.

[[Page 32472]]

National Environmental Policy Act

    The Commission has determined that the 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.

Paperwork Reduction Act

    The information collection requirements contained in this rule were 
previously approved by the Office of Management and Budget (OMB) as 
required by 44 U.S.C. 3501 et seq. and assigned OMB Control Number 
3141-0007, which expired in August of 2011. The NIGC is in the process 
of reinstating that Control Number.

    Authority: 25 U.S.C. 2706(b).

Text of the Proposed Rule

PART 547--MINIMUM TECHNICAL STANDARDS FOR GAMING EQUIPMENT USED 
WITH THE PLAY OF CLASS II GAMES

Sec.
547.1 What is the purpose of this part?
547.2 What are the definitions for this part?
547.3 Who is responsible for implementing these standards?
547.4 What are the rules of general application for this part?
547.5 How does a tribal government, TGRA, or tribal gaming operation 
comply with this part?
547.6 What are the minimum technical standards for enrolling and 
enabling Class II gaming system components?
547.7 What are the minimum technical hardware standards applicable 
to Class II gaming systems?
547.8 What are the minimum technical software standards applicable 
to Class II gaming systems?
547.9 What are the minimum technical standards for Class II gaming 
system accounting functions?
547.10 What are the minimum standards for Class II gaming system 
critical events?
547.11 What are the minimum technical standards for money and credit 
handling?
547.12 What are the minimum technical standards for downloading on a 
Class II gaming system?
547.13 What are the minimum technical standards for program storage 
media?
547.14 What are the minimum technical standards for electronic 
random number generation?
547.15 What are the minimum technical standards for electronic data 
communications between system components?
547.16 What are the minimum standards for game artwork, glass, and 
rules?
547.17 How does a TGRA apply to implement an alternate standard to 
those required by this part?

    Authority:  25 U.S.C. 2706(b).


Sec.  547.1  What is the purpose of this part?

    The Indian Gaming Regulatory Act, 25 U.S.C. 2703(7)(A)(i), permits 
the use of electronic, computer, or other technologic aids in 
connection with the play of Class II games. This part establishes the 
minimum technical standards governing the use of such aids.


Sec.  547.2  What are the definitions for this part?

    For the purposes of this part, the following definitions apply:
    Account access component. A component within a Class II gaming 
system that reads or recognizes account access media and gives a patron 
the ability to interact with an account.
    Account access medium. A magnetic stripe card or any other medium 
inserted into, or otherwise made to interact with, an account access 
component in order to give a patron the ability to interact with an 
account.
    Advertised top prize. The highest single prize available based on 
information contained in the prize schedule.
    Agent. A person authorized by the gaming operation, as approved by 
the TGRA, to make decisions or perform tasks or actions on the behalf 
of the gaming operation.
    Audit mode. The mode where it is possible to view Class II gaming 
system accounting functions, statistics, etc. and perform non-player-
related functions.
    Cancel credit. An action initiated by the Class II gaming system 
where some or all of a player's credits are removed by an attendant and 
paid to the player.
    Cashless system. A system that performs cashless transactions and 
maintains records of those cashless transactions.
    Cashless transaction. A movement of funds electronically from one 
component to another. CD-ROM. Compact Disc--Read Only Memory. Chair. 
The Chair of the National Indian Gaming Commission.
    Class II gaming. Class II gaming has the same meaning as defined in 
25 U.S.C. 2703(7)(A).
    Class II gaming system. All components, whether or not technologic 
aids in electronic, computer, mechanical, or other technologic form, 
that function together to aid the play of one or more Class II games, 
including accounting functions mandated by these regulations.
    Commission. The National Indian Gaming Commission established by 
the Indian Gaming Regulatory Act, 25 U.S.C. 2701 et seq.
    Coupon. A financial instrument of fixed wagering value, usually 
paper, that can only be used to acquire non-cashable credits through 
interaction with a voucher system. This does not include instruments 
such as printed advertising material that cannot be validated directly 
by a voucher system.
    Critical memory. Memory locations storing data essential to the 
functionality of the Class II gaming system.
    DLL. A Dynamic-Link Library file.
    Download package. Approved data sent to a component of a Class II 
gaming system for such purposes as changing the component software.
    DVD. Digital Video Disk or Digital Versatile Disk.
    Enroll. The process by which a class II gaming system identifies 
and establishes communications with an additional system component to 
allow for live gaming activity to take place on that component.
    EPROM. Erasable Programmable Read Only Memory--a non-volatile 
storage chip or device that may be filled with data and information, 
that once written is not modifiable, and that is retained even if there 
is no power applied to the system.
    Electromagnetic interference. The disruption of operation of an 
electronic device when it is in the vicinity of an electromagnetic 
field in the radio frequency spectrum that is caused by another 
electronic device.
    Electrostatic discharge. A single event, rapid transfer of 
electrostatic charge between two objects, usually resulting when two 
objects at different potentials come into direct contact with each 
other.
    Fault. An event that when detected by a Class II gaming system 
causes a discontinuance of game play or other component functions.
    Financial instrument. Any tangible item of value tendered in Class 
II game play, including, but not limited to, bills, coins, vouchers and 
coupons.
    Financial instrument acceptor. Any component that accepts financial 
instruments, such as a bill validator.
    Financial instrument dispenser. Any component that dispenses 
financial instruments, such as a ticket printer.
    Financial instrument storage component. Any component that stores 
financial instruments, such as a drop box.
    Flash memory. Non-volatile memory that retains its data when the 
power is turned off and that can be electronically erased and 
reprogrammed without being removed from the circuit board.
    Game software. The operational program or programs that govern the

[[Page 32473]]

play, display of results, and/or awarding of prizes or credits for 
Class II games.
    Gaming equipment. All electronic, electro-mechanical, mechanical, 
or other physical components utilized in the play of Class II games.
    Hardware. Gaming equipment.
    Interruption. Any form of mis-operation, component failure, or 
interference to the Class II gaming equipment.
    Modification. A revision to any hardware or software used in a 
Class II gaming system.
    Non-cashable credit. Credits given by an operator to a patron; 
placed on a Class II gaming system through a coupon, cashless 
transaction or other approved means; and capable of activating play but 
not being converted to cash.
    Patron. A person who is a customer or guest of the gaming operation 
and may interact with a Class II game. Also may be referred to as a 
``player''.
    Patron deposit account. An account maintained on behalf of a 
patron, for the purpose of depositing and withdrawing cashable funds 
for the primary purpose of interacting with a gaming activity.
    Player interface. Any component or components of a Class II gaming 
system, including an electronic or technologic aid (not limited to 
terminals, player stations, handhelds, fixed units, etc.), that 
directly enables player interaction in a Class II game.
    Prize schedule. The set of prizes available to players for 
achieving pre-designated patterns in the Class II game.
    Program storage media. An electronic data storage component, such 
as a CD-ROM, EPROM, hard disk, or flash memory on which software is 
stored and from which software is read.
    Progressive prize. A prize that increases by a selectable or 
predefined amount based on play of a Class II game.
    Random number generator (RNG). A software module, hardware 
component or combination of these designed to produce outputs that are 
effectively random.
    Reflexive software. Any software that has the ability to manipulate 
and/or replace a randomly generated outcome for the purpose of changing 
the results of a Class II game.
    Removable/rewritable storage media. Program or data storage 
components that can be removed from gaming equipment and be written to, 
or rewritten by, the gaming equipment or by other equipment designed 
for that purpose.
    Server. A computer that controls one or more applications or 
environments within a Class II gaming system.
    Test/diagnostics mode. A mode on a component that allows various 
tests to be performed on the Class II gaming system hardware and 
software.
    Testing laboratory. An organization recognized by a TGRA pursuant 
to Sec.  547.5(f).
    TGRA. Tribal gaming regulatory authority, which is the entity 
authorized by tribal law to regulate gaming conducted pursuant to the 
Indian Gaming Regulatory Act.
    Unenroll. The process by which a class II gaming system disconnects 
an enrolled system component, disallowing any live gaming activity to 
take place on that component.
    Voucher. A financial instrument of fixed wagering value, usually 
paper, that can only be used to acquire an equivalent value of cashable 
credits or cash through interaction with a voucher system.
    Voucher system. A component of the Class II gaming system that 
securely maintains records of vouchers and coupons; validates payment 
of vouchers; records successful or failed payments of vouchers and 
coupons; and controls the purging of expired vouchers and coupons.


Sec.  547.3  Who is responsible for implementing these standards?

    (a) Minimum Standards. These are minimum standards and a TGRA may 
establish and implement additional technical standards that do not 
conflict with the standards set out in this part.
    (b) No Limitation of Technology. This part should not be 
interpreted to limit the use of technology or to preclude the use of 
technology not specifically referenced.
    (c) Only applicable standards apply. Class II gaming system 
equipment and software must meet all applicable requirements of this 
part. For example, if a Class II gaming system lacks the ability to 
print or accept vouchers, then any standards that govern vouchers do 
not apply. These standards do not apply to associated equipment such as 
voucher and kiosk systems.
    (d) State Jurisdiction. Nothing in this part shall be construed to 
grant to a state jurisdiction over Class II gaming or to extend a 
state's jurisdiction over Class III gaming.


Sec.  547.4  What are the rules of general application for this part?

    (a) Fairness. No Class II gaming system may cheat or mislead users. 
All prizes advertised must be available to win during the game. Test 
laboratory must calculate and/or verify the mathematical expectations 
of game play, where applicable, in accordance with the manufacturer 
stated submission. The results must be included in the test 
laboratory's report to the TGRA. At the request of the TGRA, the 
manufacturer must also submit the mathematical expectations of the game 
play to the TGRA.
    (b) Approved equipment and software only. All gaming equipment and 
software used with Class II gaming systems must be identical in all 
respects to a prototype reviewed and tested by a testing laboratory and 
approved for use by the TGRA pursuant to Sec.  547.5(a) through (c).
    (c) Proper functioning. All gaming equipment and software used with 
Class II gaming systems must perform according to the manufacturer's 
design and operating specifications.


Sec.  547.5  How does a tribal government, TGRA, or tribal gaming 
operation comply with this part?

    (a) Limited immediate compliance. A tribal gaming regulatory 
authority shall:
    (1) Require that all Class II gaming system software that affects 
the play of the Class II game be submitted, together with the signature 
verification required by Sec.  547.8(f), to a testing laboratory 
recognized pursuant to paragraph (f) of this section within 120 days 
after November 10, 2008;
    (2) Require that the testing laboratory test the submission to the 
standards established by Sec.  547.8(b), Sec.  547.8(f), Sec.  547.14, 
and to any additional technical standards adopted by the TGRA;
    (3) Require that the testing laboratory provide the TGRA with a 
formal written report setting forth and certifying to the findings and 
conclusions of the test;
    (4) Make a finding, in the form of a certificate provided to the 
supplier or manufacturer of the Class II gaming system, that the Class 
II gaming system qualifies for grandfather status under the provisions 
of this section, but only upon receipt of a testing laboratory's report 
that the Class II gaming system is compliant with Sec.  547.8(b), Sec.  
547.8(f), Sec.  547.14, and any other technical standards adopted by 
the TGRA. If the TGRA does not issue the certificate, or if the testing 
laboratory finds that the Class II gaming system is not compliant with 
Sec.  547.8(b), Sec.  547.8(f), Sec.  547.14, or any other technical 
standards adopted by the TGRA, then the gaming system shall immediately 
be removed from play and not be utilized.
    (5) Retain a copy of any testing laboratory's report so long as the 
Class II gaming system that is the subject of the report remains 
available to the public for play;
    (6) Retain a copy of any certificate of grandfather status so long 
as the Class II gaming system that is the subject of

[[Page 32474]]

the certificate remains available to the public for play; and
    (7) Require the supplier of any player interface to designate with 
a permanently affixed label each player interface with an identifying 
number and the date of manufacture or a statement that the date of 
manufacture was on or before November 10, 2008. The tribal gaming 
regulatory authority shall also require the supplier to provide a 
written declaration or affidavit affirming that the date of manufacture 
was on or before November 10, 2008.
    (b) Grandfather provisions. All Class II gaming systems 
manufactured before November 10, 2008, and certified pursuant to 
paragraph (a) of this section are grandfathered Class II gaming systems 
for which the following provisions apply:
    (1) Grandfathered Class II gaming systems may continue in operation 
for a period of five years from November 10, 2008.
    (2) Grandfathered Class II gaming system shall be available for use 
at any tribal gaming facility subject to approval by the TGRA, which 
shall transmit its notice of that approval, identifying the 
grandfathered Class II gaming system and its components, to the 
Commission.
    (3) As permitted by the TGRA, individual hardware or software 
components of a grandfathered Class II gaming system may be repaired or 
replaced to ensure proper functioning, security, or integrity of the 
grandfathered Class II gaming system.
    (4) All modifications that affect the play of a grandfathered Class 
II gaming system must be approved pursuant to paragraph (c) of this 
section, except for the following:
    (i) Any software modifications that the TGRA finds will maintain or 
advance the Class II gaming system's overall compliance with this part 
or any applicable provisions of part 543 of this chapter, after 
receiving a new testing laboratory report that the modifications are 
compliant with the standards established by Sec.  547.8(b), Sec.  
547.14, and any other standards adopted by the TGRA;
    (ii) Any hardware modifications that the TGRA finds will maintain 
or advance the system's overall compliance with this part or any 
applicable provisions of part 543 of this chapter; and
    (iii) Any other modification to the software of a grandfathered 
Class II gaming system that the TGRA finds will not detract from, 
compromise or prejudice:
    (A) The proper functioning, security, or integrity of the Class II 
gaming system, and
    (B) The gaming system's overall compliance with the requirements of 
this part or any applicable provisions of part 543 of this chapter.
    (iv) No such modification may be implemented without the approval 
of the TGRA. The TGRA shall maintain a record of the modification so 
long as the Class II gaming system that is the subject of the 
modification remains available to the public for play and shall make 
the record available to the Commission upon request. The Commission 
will only make available for public review records or portions of 
records subject to release under the Freedom of Information Act, 5 
U.S.C. 552; the Privacy Act of 1974, 5 U.S.C. 552a; or the Indian 
Gaming Regulatory Act, 25 U.S.C. 2716(a).
    (c) Submission, testing, and approval--generally. Except as 
provided in paragraphs (b) and (d) of this section, a TGRA may not 
permit the use of any Class II gaming system, or any associated 
cashless system or voucher system or any modification thereto, in a 
tribal gaming operation unless:
    (1) The Class II gaming system, cashless system, voucher payment 
system, or modification thereto has been submitted to a testing 
laboratory;
    (2) The testing laboratory tests the submission to the standards 
established by:
    (i) This part;
    (ii) Any applicable provisions of part 543 of this chapter that are 
testable by the testing laboratory; and
    (iii) The TGRA;
    (3) The testing laboratory provides a formal written report to the 
party making the submission, setting forth and certifying to its 
findings and conclusions, and noting compliance with any standard 
established by the TGRA pursuant to (c)(2)(iii) of this section;
    (4) The testing laboratory's written report confirms that the 
operation of each player interface has been certified that it will not 
be compromised or affected by electrostatic discharge, liquid spills, 
electromagnetic interference, radio frequency interference, or any 
other tests required by the TGRA;
    (5) Following receipt of the testing laboratory's report, the TGRA 
makes a finding that the Class II gaming system, cashless system, or 
voucher system conforms to the standards established by:
    (A) This part;
    (B) Any applicable provisions of part 543 of this chapter that are 
testable by the testing laboratory; and
    (C) The TGRA.
    (6) The TGRA must retain a copy of the testing laboratory's report 
required by paragraph (c) of this section so long as the Class II 
gaming system, cashless system, voucher system, or modification thereto 
that is the subject of the report remains available to the public for 
play in its gaming operation.
    (d) Emergency hardware and software modifications.
    (1) A TGRA, in its discretion, may permit the modification of 
previously approved hardware or software to be made available for play 
without prior laboratory testing or review if the modified hardware or 
software is:
    (i) Necessary to correct a problem affecting the fairness, 
security, or integrity of a game or accounting system or any cashless 
system, or voucher system; or
    (ii) Unrelated to game play, an accounting system, a cashless 
system, or a voucher system.
    (2) If a TGRA authorizes modified software or hardware to be made 
available for play or use without prior testing laboratory review, the 
TGRA must thereafter require the hardware or software manufacturer to:
    (i) Immediately advise other users of the same hardware or software 
of the importance and availability of the update;
    (ii) Immediately submit the new or modified hardware or software to 
a testing laboratory for testing and verification of compliance with 
this part and any applicable provisions of part 543 of this chapter 
that are testable by the testing laboratory; and
    (iii) Immediately provide the TGRA with a software signature 
verification tool meeting the requirements of Sec.  547.8(f) for any 
new or modified software.
    (3) If a TGRA authorizes a software or hardware modification under 
this paragraph, it must maintain a record of the modification and a 
copy of the testing laboratory report so long as the Class II gaming 
system that is the subject of the modification remains available to the 
public for play and must make the record available to the Commission 
upon request. The Commission will only make available for public review 
records or portions of records subject to release under the Freedom of 
Information Act, 5 U.S.C. 552; the Privacy Act of 1974, 5 U.S.C. 552a; 
or the Indian Gaming Regulatory Act, 25 U.S.C. 2716(a).
    (e) Compliance by charitable gaming operations. This part does not 
apply to

[[Page 32475]]

charitable gaming operations, provided that:
    (1) The tribal government determines that the organization 
sponsoring the gaming operation is a charitable organization;
    (2) All proceeds of the charitable gaming operation are for the 
benefit of the charitable organization;
    (3) The TGRA permits the charitable organization to be exempt from 
this part;
    (4) The charitable gaming operation is operated wholly by the 
charitable organization's employees or volunteers; and
    (5) The annual gross gaming revenue of the charitable gaming 
operation does not exceed $1,000,000.
    (f) Testing laboratories.
    (1) A testing laboratory may provide the examination, testing, 
evaluating and reporting functions required by this section provided 
that:
    (i) It demonstrates its integrity, independence and financial 
stability to the TGRA.
    (ii) It demonstrates its technical skill and capability to the 
TGRA.
    (iii) If the testing laboratory is owned or operated by, or 
affiliated with, a tribe, it must be independent from the manufacturer 
and gaming operator for whom it is providing the testing, evaluating, 
and reporting functions required by this section.
    (iv) The TGRA:
    (A) Makes a suitability determination of the testing laboratory 
based upon standards no less stringent than those set out in Sec. Sec.  
533.6(b)(1)(ii) through (v) of this chapter and based upon no less 
information than that required by Sec.  537.1 of this chapter, or
    (B) Accepts, in its discretion, a determination of suitability for 
the testing laboratory made by any other gaming regulatory authority in 
the United States.
    (v) After reviewing the suitability determination and the 
information provided by the testing laboratory, the TGRA determines 
that the testing laboratory is qualified to test and evaluate Class II 
gaming systems.
    (2) The TGRA must:
    (i) Maintain a record of all determinations made pursuant to 
paragraphs (f)(1)(iii) and (f)(1)(iv) of this section for a minimum of 
three years and must make the records available to the Commission upon 
request. The Commission will only make available for public review 
records or portions of records subject to release under the Freedom of 
Information Act, 5 U.S.C. 552; the Privacy Act of 1974, 5 U.S.C. 552a; 
or the Indian Gaming Regulatory Act, 25 U.S.C. 2716(a).
    (ii) Place the testing laboratory under a continuing obligation to 
notify it of any adverse regulatory action in any jurisdiction where 
the testing laboratory conducts business.
    (iii) Require the testing laboratory to provide notice of any 
material changes to the information provided to the TGRA.


Sec.  547.6  What are the minimum technical standards for enrolling and 
enabling Class II gaming system components?

    (a) General requirements. Class II gaming systems must provide a 
method to:
    (1) Enroll and unenroll Class II gaming system components;
    (2) Enable and disable specific Class II gaming system components.
    (b) Specific requirements. Class II gaming systems must:
    (1) Ensure that only enrolled and enabled Class II gaming system 
components participate in gaming; and
    (2) Ensure that the default condition for components must be 
unenrolled and disabled.


Sec.  547.7  What are the minimum technical hardware standards 
applicable to Class II gaming systems?

    (a) Printed circuit boards.
    (1) Printed circuit boards that have the potential to affect the 
outcome or integrity of the game, and are specially manufactured or 
proprietary and not off-the-shelf, must display a unique identifier 
such as a part number and/or revision number, which must be updated to 
reflect new revisions or modifications of the board.
    (2) Switches or jumpers on all circuit boards that have the 
potential to affect the outcome or integrity of any game, progressive 
award, financial instrument, cashless transaction, voucher transaction, 
or accounting records must be capable of being sealed.
    (b) Electrostatic discharge. Class II gaming system components 
accessible to the public must be constructed so that they exhibit 
immunity to human body electrostatic discharges on areas exposed to 
contact. Static discharges of 15 kV for air discharges and 
7.5 kV for contact discharges must not cause damage or 
inhibit operation or integrity of the Class II gaming system.
    (c) Physical enclosures. Physical enclosures must be of a robust 
construction designed to resist determined illegal entry. All 
protuberances and attachments such as buttons, identification plates, 
and labels must be sufficiently robust to avoid unauthorized removal.
    (d) Player interface. The player interface must be labeled with the 
serial number and date of manufacture and include a method or means to:
    (1) Display information to a player; and
    (2) Allow the player to interact with the Class II gaming system.
    (e) Account access components. A Class II gaming system component 
that reads account access media must be located within a secure and 
locked area, cabinet, or housing that is of a robust construction 
designed to resist determined illegal entry and to protect internal 
components. In addition, the account access component:
    (1) Must be constructed so that physical tampering leaves evidence 
of such tampering; and
    (2) Must provide a method to enable the Class II gaming system to 
interpret and act upon valid or invalid input or error condition.
    (f) Financial instrument storage components. Any Class II gaming 
system components that store financial instruments and that are not 
operated under the direct control of a gaming operation employee or 
agent must be located within a secure and locked area, cabinet, or 
housing that is of a robust construction designed to resist determined 
illegal entry and to protect internal components.
    (g) Financial instrument acceptors.
    (1) Any Class II gaming system components that handle financial 
instruments and that are not operated under the direct control of an 
agent must:
    (i) Be located within a secure and locked area, cabinet, or housing 
that is of a robust construction designed to resist determined illegal 
entry and to protect internal components;
    (ii) Be able to detect the entry of valid or invalid financial 
instruments and to provide a method to enable the Class II gaming 
system to interpret and act upon valid or invalid input or error 
condition; and
    (iii) Be constructed to permit communication with the Class II 
gaming system of the accounting information required by Sec.  547.9(a) 
and by applicable provisions of any Commission and TGRA regulations 
governing minimum internal control standards.
    (2) Prior to completion of a valid financial instrument transaction 
by the Class II gaming system, no monetary amount related to that 
instrument may be available for play. For example, credits may not be 
available for play until currency or coupon inserted into an acceptor 
is secured in the storage component.
    (3) The monetary amount related to all valid financial instrument 
transactions by the Class II gaming

[[Page 32476]]

system must be recorded as required by Sec.  547.9(a) and the 
applicable provisions of any Commission and TGRA regulations governing 
minimum internal control standards.
    (h) Financial instrument dispensers.
    (1) Any Class II gaming system components that dispense financial 
instruments and that are not operated under the direct control of a 
gaming operation employee or agent must:
    (i) Be located within a secure, locked and tamper-evident area or 
in a locked cabinet or housing that is of a robust construction 
designed to resist determined illegal entry and to protect internal 
components;
    (ii) Provide a method to enable the Class II gaming system to 
interpret and act upon valid or invalid input or error condition; and
    (iii) Be constructed to permit communication with the Class II 
gaming system of the accounting information required by Sec.  547.9(a) 
and by applicable provisions of any Commission and TGRA regulations 
governing minimum internal control standards.
    (2) The monetary amount related to all valid financial instrument 
transactions by the Class II gaming system must be recorded as required 
by Sec.  547.9(a), the applicable provisions of part 543 of this 
chapter, and any TGRA regulations governing minimum internal control 
standards.
    (i) Game Outcome Determination Components. Any Class II gaming 
system logic components that affect the game outcome and that are not 
operated under the direct control of a gaming operation employee or 
agent must be located within a secure, locked and tamper-evident area 
or in a locked cabinet or housing that is of a robust construction 
designed to resist determined illegal entry and to protect internal 
components. DIP switches or jumpers that can affect the integrity of 
the Class II gaming system must be capable of being sealed by the TGRA.
    (j) Door access detection. All components of the Class II gaming 
system that are locked in order to meet the requirements of this part 
must include a sensor or other methods to monitor an open door. A door 
open sensor, and its components or cables, must be secure against 
attempts to disable them or interfere with their normal mode of 
operation.
    (k) Separation of functions/no limitations on technology. Nothing 
herein prohibits the account access component, financial instrument 
storage component, financial instrument acceptor, and financial 
instrument dispenser from being included within the same component or 
being separated into individual components.


Sec.  547.8  What are the minimum technical software standards 
applicable to Class II gaming systems?

    (a) Player interface displays.
    (1) If not otherwise provided to the player, the player interface 
must display the following:
    (i) The purchase or wager amount;
    (ii) Game results; and
    (iii) Any player credit balance.
    (2) Between plays of any game and until the start of the next play, 
or until the player selects a new game option such as purchase or wager 
amount or card selection, whichever is earlier, if not otherwise 
provided to the player, the player interface must display:
    (i) The total purchase or wager amount and all prizes and total 
credits won for the last game played;
    (ii) The final results for the last game played; and
    (iii) Any default purchase or wager amount for the next play.
    (b) Game initiation and play.
    (1) Each game played on the Class II gaming system must follow and 
not deviate from a constant set of rules for each game provided to 
players pursuant to Sec.  547.16. There must be no automatic or 
undisclosed changes of rules.
    (2) The Class II gaming system may not alter or allow to be altered 
the card permutations used for play of a Class II game unless 
specifically chosen by the player prior to commitment to participate in 
the game. No duplicate cards may be sold for any common draw.
    (3) No game play may commence and, no financial instrument or 
credit may be accepted on the affected player interface, in the 
presence of any fault condition that affects the outcome of the game, 
open door, or while in test, audit, or lock-up mode.
    (4) No game play may commence unless initiated by a player.
    (c) Audit Mode.
    (1) If an audit mode is provided, the Class II gaming system must 
provide, for those components actively involved in the audit:
    (i) All accounting functions required by Sec.  547.9, by applicable 
provisions of any Commission regulations governing minimum internal 
control standards, and by any internal controls adopted by the tribe or 
TGRA;
    (ii) Display player interface identification; and
    (iii) Display software version or game identification;
    (2) Audit mode must be accessible by a secure method such as an 
agent PIN, key, or other auditable access control.
    (3) Accounting function data must be accessible by an agent at any 
time, except during a payout, during a handpay, or during play.
    (4) The Class II gaming system must disable financial instrument 
acceptance on the affected player interface while in audit mode, except 
during financial instrument acceptance testing.
    (d) Last game recall. The last game recall function must:
    (1) Be retrievable at all times, other than when the recall 
component is involved in the play of a game, upon the operation of an 
external key-switch, entry of an audit card, or a similar method;
    (2) Display the results of recalled games as originally displayed 
or in text representation so as to enable the TGRA or operator to 
clearly identify the sequences and results that occurred;
    (3) Allow the Class II gaming system component providing game 
recall, upon return to normal game play mode, to restore any affected 
display to the positions, forms and values displayed before access to 
the game recall information; and
    (4) Provide the following information for the current and previous 
four games played and must display:
    (i) Play start time, end time, and date;
    (ii) The total number of credits at the start of play;
    (iii) The purchase or wager amount;
    (iv) The total number of credits at the end of play;
    (v) The total number of credits won as a result of the game 
recalled, and the value in dollars and cents for progressive prizes, if 
different;
    (vi) For bingo games and games similar to bingo, also display:
    (A) The card(s) used by the player;
    (B) The identifier of the bingo game played;
    (C) The numbers or other designations drawn, in the order that they 
were drawn;
    (D) The numbers or other designations and prize patterns covered on 
each card;
    (E) All prizes won by the player, including winning patterns, if 
any; and
    (F) The unique identifier of the card on which prizes were won;
    (vii) For pull-tab games only, also display:
    (A) The result(s) of each pull-tab, displayed in the same pattern 
as on the tangible pull-tab;
    (B) All prizes won by the player;
    (C) The unique identifier of each pull tab; and
    (D) Any other information necessary to fully reconstruct the 
current and four previous plays.
    (e) Voucher and credit transfer recall. Notwithstanding the 
requirements of

[[Page 32477]]

any other section in this part, a Class II gaming system must have the 
capacity to:
    (1) Display the information specified in Sec.  547.11(b)(5)(ii) 
through (vi) for the last five vouchers or coupons printed and the last 
five vouchers or coupons accepted; and
    (2) Display a complete transaction history for the last five 
cashless transactions made and the last five cashless transactions 
accepted.
    (f) Software signature verification. The manufacturer or developer 
of the Class II gaming system must provide to the testing laboratory 
and to the TGRA an industry-standard methodology, acceptable to the 
TGRA, for verifying the Class II gaming system game software. By way of 
illustration, for game software stored on rewritable media, such 
methodologies include signature algorithms and hashing formulas such as 
SHA-1.
    (g) Test, diagnostic, and demonstration modes. If test, diagnostic, 
and/or demonstration modes are provided, the Class II gaming system 
must, for those components actively involved in the test, diagnostic, 
or demonstration mode:
    (1) Clearly indicate when that component is in the test, 
diagnostic, or demonstration mode;
    (2) Not alter financial data on that component other than temporary 
data;
    (3) Only be available after entering a specific mode;
    (4) Disable credit acceptance and payment unless credit acceptance 
or payment is being tested; and
    (5) Terminate all mode-specific functions upon exiting a mode.
    (h) Multigame. If multiple games are offered for player selection 
at the player interface, the player interface must:
    (1) Provide a display of available games;
    (2) Provide the means of selecting among them;
    (3) Display the full amount of the player's credit balance;
    (4) Identify the game selected or being played; and
    (5) Not force the play of a game after its selection.
    (i) Program interruption and resumption. The Class II gaming system 
software must be designed so that upon resumption following any 
interruption, the system:
    (1) Is able to return to a known state;
    (2) Must check for any fault condition;
    (3) Must verify the integrity of data stored in critical memory;
    (4) Must return the purchase or wager amount to the player in 
accordance with the rules of the game; and
    (5) Must detect any change or corruption in the Class II gaming 
system software.
    (j) Class II gaming system components acting as progressive 
controllers. This paragraph applies to progressive controllers and 
components acting as progressive controllers in Class II gaming 
systems.
    (1) Modification of progressive parameters must be conducted in a 
secure manner approved by the TGRA. Such parameters may include:
    (i) Increment value;
    (ii) Secondary pool increment(s);
    (iii) Reset amount(s);
    (iv) Maximum value(s); and
    (v) Identity of participating player interfaces.
    (2) The Class II gaming system component or other progressive 
controller must provide a means of creating a progressive balancing 
report for each progressive link it controls. At a minimum, that report 
must provide balancing of the changes of the progressive amount, 
including progressive prizes won, for all participating player 
interfaces versus current progressive amount(s), plus progressive 
prizes. In addition, the report must account for, and not be made 
inaccurate by, unusual events such as:
    (i) Class II gaming system critical memory clears;
    (ii) Modification, alteration, or deletion of progressive prizes;
    (iii) Offline equipment; or
    (iv) Multiple site progressive prizes.
    (k) Critical memory.
    (1) Critical memory may be located anywhere within the Class II 
gaming system. Critical memory is any memory that maintains any of the 
following data:
    (i) Accounting data;
    (ii) Current credits;
    (iii) Configuration data;
    (iv) Last game play recall information required by Sec.  547.8(d);
    (v) Game play recall information for the current game play, if 
incomplete;
    (vi) Software state (the last normal state software was in before 
interruption);
    (vii) RNG seed(s), if necessary for maintaining integrity;
    (viii) Encryption keys, if necessary for maintaining integrity;
    (ix) Progressive prize parameters and current values;
    (x) The five most recent financial instruments accepted by type, 
excluding coins and tokens;
    (xi) The five most recent financial instruments dispensed by type, 
excluding coins and tokens; and
    (xii) The five most recent cashless transactions paid and the five 
most recent cashless transactions accepted.
    (2) Critical memory must be maintained using a methodology that 
enables errors to be identified and acted upon. All accounting and 
recall functions must be verified as necessary to ensure their ongoing 
integrity.
    (3) The validity of affected data stored in critical memory must be 
checked after each of the following events:
    (i) Every restart;
    (ii) Each attendant paid win;
    (iii) Each sensored door closure; and
    (iv) Every reconfiguration, download, or change of prize schedule 
or denomination requiring operator intervention or action.
    (l) Secured access. Class II gaming systems that use a logon or 
other means of secured access must include a user account lockout after 
a predetermined number of consecutive failed attempts to access the 
Class II gaming system.


Sec.  547.9  What are the minimum technical standards for Class II 
gaming system accounting functions?

    (a) Required accounting data. The following minimum accounting 
data, however named, must be maintained by the Class II gaming system:
    (1) Amount In: The total value of all financial instruments and 
cashless transactions accepted by the Class II gaming system. Each type 
of financial instrument accepted by the Class II gaming system must be 
tracked independently per financial instrument acceptor, and as 
required by applicable requirements of TGRA regulations that meet or 
exceed the minimum internal control standards at 25 CFR part 543.
    (2) Amount Out: The total value of all financial instruments and 
cashless transactions paid by the Class II gaming system, plus the 
total value of attendant pay. Each type of financial instrument paid by 
the Class II Gaming System must be tracked independently per financial 
instrument dispenser, and as required by applicable requirements of 
TGRA regulations that meet or exceed the minimum internal control 
standards at 25 CFR part 543.
    (b) Accounting data storage. If the Class II gaming system 
electronically maintains accounting data:
    (1) Accounting data must be stored with at least eight decimal 
digits.
    (2) Credit balances must have sufficient digits to accommodate the 
design of the game.
    (3) Accounting data displayed to the player may be incremented or 
decremented using visual effects, but the internal storage of this data 
must be immediately updated in full.
    (4) Accounting data must be updated upon the occurrence of the 
relevant accounting event.

[[Page 32478]]

    (5) Modifications to accounting data must be recorded, including 
the identity of the person(s) making the modifications, and be 
reportable by the Class II gaming system.
    (c) Rollover. Accounting data that rolls over to zero must not 
corrupt data.
    (d) Credit balance display and function.
    (1) Any credit balance maintained at the player interface must be 
prominently displayed at all times except:
    (i) In audit, configuration, recall and test modes; or
    (ii) Temporarily, during entertaining displays of game results.
    (2) Progressive prizes may be added to the player's credit balance 
provided:
    (i) The player credit balance is maintained in dollars and cents;
    (ii) The progressive accounting data is incremented in number of 
credits; or
    (iii) The prize in dollars and cents is converted to player credits 
or transferred to the player's credit balance in a manner that does not 
mislead the player or cause accounting imbalances.
    (3) If the player credit balance displays in credits, but the 
actual balance includes fractional credits, the Class II gaming system 
must display the fractional credit when the player credit balance drops 
below one credit.


Sec.  547.10  What are the minimum standards for Class II gaming system 
critical events?

    (a) Fault events.
    (1) The following are fault events that must be capable of being 
recorded by the Class II gaming system:

------------------------------------------------------------------------
               Event                  Definition and action to be taken
------------------------------------------------------------------------
(i) Component fault...............  Reported when a fault on a component
                                     is detected. When possible, this
                                     event message should indicate what
                                     the nature of the fault is.
(ii) Financial storage component    Reported when a financial instrument
 full.                               acceptor or dispenser includes
                                     storage, and it becomes full. This
                                     event message must indicate what
                                     financial storage component is
                                     full.
(iii) Financial output component    Reported when a financial instrument
 empty.                              dispenser is empty. The event
                                     message must indicate which
                                     financial output component is
                                     affected, and whether it is empty.
(iv) Financial component fault....  Reported when an occurrence on a
                                     financial component results in a
                                     known fault state.
(v) Critical memory error.........  Some critical memory error has
                                     occurred. When a non-correctable
                                     critical memory error has occurred,
                                     the data on the Class II gaming
                                     system component can no longer be
                                     considered reliable. Accordingly,
                                     any game play on the affected
                                     component must cease immediately,
                                     and an appropriate message must be
                                     displayed, if possible.
(vi) Progressive communication      If applicable; when communications
 fault.                              with a progressive controller
                                     component is in a known fault
                                     state.
(vii) Program storage medium fault  The software has failed its own
                                     internal security check or the
                                     medium itself has some fault. Any
                                     game play on the affected component
                                     must cease immediately, and an
                                     appropriate message must be
                                     displayed, if possible.
------------------------------------------------------------------------

    (2) The occurrence of any event identified in paragraph (a)(1) of 
this section must be recorded.
    (3) Upon clearing any event identified in paragraph (a)(1) of this 
section, the Class II gaming system must:
    (i) Record that the fault condition has been cleared;
    (ii) Ensure the integrity of all related accounting data; and
    (iii) In the case of a malfunction, return a player's purchase or 
wager according to the rules of the game.
    (b) Door open/close events.
    (1) In addition to the requirements of paragraph (a)(1) of this 
section, the Class II gaming system must perform the following for any 
component affected by any sensored door open event:
    (i) Indicate that the state of a sensored door changes from closed 
to open or opened to closed;
    (ii) Disable all financial instrument acceptance, unless a test 
mode is entered;
    (iii) Disable game play on the affected player interface;
    (iv) Disable player inputs on the affected player interface, unless 
test mode is entered; and
    (v) Disable all financial instrument disbursement, unless a test 
mode is entered.
    (2) The Class II gaming system may return the component to a ready 
to play state when all sensored doors are closed.
    (c) Non-fault events. (1) The following non-fault events are to be 
acted upon as described below, if applicable:

------------------------------------------------------------------------
               Event                             Definition
------------------------------------------------------------------------
(i) Player interface off during     Indicates power has been lost during
 play.                               game play. This condition must be
                                     reported by the affected
                                     component(s).
(ii) Player interface power on....  Indicates the player interface has
                                     been turned on. This condition must
                                     be reported by the affected
                                     component(s).
(iii) Financial instrument storage  Indicates that a financial
 component container/stacker         instrument storage container has
 removed.                            been removed. The event message
                                     must indicate which storage
                                     container was removed.
------------------------------------------------------------------------

Sec.  547.11  What are the minimum technical standards for money and 
credit handling?

    (a) Credit acceptance, generally.
    (1) Upon any credit acceptance, the Class II gaming system must 
register the correct number of credits on the player's credit balance.
    (2) The Class II gaming system must reject financial instruments 
deemed invalid.
    (b) Credit redemption, generally.
    (1) For cashable credits on a player interface, players must be 
allowed to cash out and/or redeem those credits at the player interface 
except when that player interface is:
    (i) Involved in the play of a game;
    (ii) In audit mode, recall mode or any test mode;
    (iii) Detecting any sensored door open condition;
    (iv) Updating the player credit balance or total win accounting 
data; or
    (v) Displaying a fault condition that would prevent cash-out or 
credit

[[Page 32479]]

redemption. In this case a fault indication must be displayed.
    (2) For cashable credits not on a player interface, the player must 
be allowed to cash out and/or redeem those credits at any time.
    (3) A Class II gaming system must not automatically pay an award 
subject to mandatory tax reporting or withholding.
    (4) Credit redemption by voucher or coupon must conform to the 
following:
    (i) A Class II gaming system may redeem credits by issuing a 
voucher or coupon when it communicates with a voucher system that 
validates the voucher or coupon.
    (ii) A Class II gaming system that redeems credits by issuing 
vouchers and coupons must either:
    (A) Maintain an electronic record of all information required by 
paragraphs (b)(5)(ii) through (vi) of this section; or
    (B) Generate two identical copies of each voucher or coupon issued, 
one to be provided to the player and the other to be retained within 
the electronic player interface for audit purposes.
    (5) Valid vouchers and coupons from a voucher system must contain 
the following:
    (i) Gaming operation name and location;
    (ii) The identification number of the Class II gaming system 
component or the player interface number, as applicable;
    (iii) Date and time of issuance;
    (iv) Alpha and numeric dollar amount;
    (v) A sequence number;
    (vi) A validation number that:
    (A) Is produced by a means specifically designed to prevent 
repetition of validation numbers; and
    (B) Has some form of checkcode or other form of information 
redundancy to prevent prediction of subsequent validation numbers 
without knowledge of the checkcode algorithm and parameters;
    (vii) For machine-readable vouchers and coupons, a bar code or 
other form of machine readable representation of the validation number, 
which must have enough redundancy and error checking to ensure that 
99.9% of all misreads are flagged as errors;
    (viii) Transaction type or other method of differentiating voucher 
and coupon types; and
    (ix) Expiration period or date.
    (6) Transfers from an account may not exceed the balance of that 
account.
    (7) For Class II gaming systems not using dollars and cents 
accounting and not having odd cents accounting, the Class II gaming 
system must reject any transfers from voucher payment systems or 
cashless systems that are not even multiples of the Class II gaming 
system denomination.
    (8) Voucher redemption systems must include the ability to report 
redemptions per redemption location or user.


Sec.  547.12  What are the minimum technical standards for downloading 
on a Class II gaming system?

    (a) Downloads.
    (1) Downloads are an acceptable means of transporting approved 
content, including but not limited to software, files, data, and prize 
schedules.
    (2) Downloads must use secure methodologies that will deliver the 
download data without alteration or modification, in accordance with 
Sec.  547.15(a).
    (3) Downloads conducted during operational periods must be 
performed in a manner that will not affect game play.
    (4) Downloads must not affect the integrity of accounting data.
    (5) The Class II gaming system must be capable of providing:
    (i) The time and date of the initiation of the download;
    (ii) The time and date of the completion of the download;
    (iii) The Class II gaming system components to which software was 
downloaded;
    (iv) The version(s) of download package and any software 
downloaded. Logging of the unique software signature will satisfy this 
requirement;
    (v) The outcome of any software verification following the download 
(success or failure); and
    (vi) The name and identification number, or other unique 
identifier, of any individual(s) conducting or scheduling a download.
    (b) Verifying downloads. Downloaded software on a Class II gaming 
system must be capable of being verified by the Class II gaming system 
using a software signature verification method that meets the 
requirements of Sec.  547.8(f).


Sec.  547.13  What are the minimum technical standards for program 
storage media?

    (a) Removable program storage media. All removable program storage 
media must maintain an internal checksum or signature of its contents. 
Verification of this checksum or signature is to be performed after 
every restart. If the verification fails, the affected Class II gaming 
system component(s) must lock up and enter a fault state.
    (b) Nonrewritable program storage media.
    (1) All EPROMs and Programmable Logic Devices that have erasure 
windows must be fitted with covers over their erasure windows.
    (2) All unused areas of EPROMs must be written with the inverse of 
the erased state (zero bits (00 hex) for most EPROMs), random data, or 
repeats of the program data.
    (3) Flash memory storage components intended to have the same 
logical function as ROM, must be write-protected or otherwise protected 
from unauthorized modification.
    (4) The write cycle must be closed or finished for all CD-ROMs such 
that it is not possible to write any further data to the CD.
    (5) Write protected hard disks are permitted if the hardware means 
of enabling the write protect is easily viewable and can be sealed in 
place. Write protected hard disks are permitted using software write 
protection verifiable by a testing laboratory.
    (c) Writable and rewritable program storage media.
    (1) Writable and rewritable program storage, such as hard disk 
drives, Flash memory, writable CD-ROMs, and writable DVDs, may be used 
provided that the software stored thereon may be verified using the 
mechanism provided pursuant to Sec.  547.8(f).
    (2) Program storage must be structured so there is a verifiable 
separation of fixed data (such as program, fixed parameters, DLLs) and 
variable data.
    (d) Identification of program storage media. All program storage 
media that is not rewritable in circuit, (EPROM, CD-ROM) must be 
uniquely identified, displaying:
    (1) Manufacturer;
    (2) Program identifier;
    (3) Program version number(s); and
    (4) Location information, if critical (socket position 3 on the 
printed circuit board).


Sec.  547.14  What are the minimum technical standards for electronic 
random number generation?

    (a) Properties. All RNGs must produce output having the following 
properties:
    (1) Statistical randomness;
    (2) Unpredictability; and
    (3) Non-repeatability.
    (b) Statistical Randomness.
    (1) Numbers or other designations produced by an RNG must be 
statistically random individually and in the permutations and 
combinations used in the application under the rules of the game. For 
example, if a bingo game with 75 objects with numbers or other 
designations has a progressive winning pattern of the five numbers or 
other designations on the bottom of the card, and the winning of this 
prize is defined to be the five numbers or other designations that are 
matched in the

[[Page 32480]]

first five objects drawn, the likelihood of each of the 75C5 
combinations are to be verified to be statistically equal.
    (2) Numbers or other designations produced by an RNG must pass the 
statistical tests for randomness to a 99% confidence level.
    (i) Mandatory statistical tests for randomness include:
    (A) Chi-square test;
    (B) Runs test (patterns of occurrences must not be recurrent); and
    (C) Serial correlation test potency and degree of serial 
correlation (outcomes must be independent from the previous game).
    (ii) Where applicable statistical tests for randomness may include:
    (A) Equi-distribution (frequency) test;
    (B) Gap test;
    (C) Poker test;
    (D) Coupon collector's test;
    (E) Permutation test;
    (F) Spectral test; or
    (G) Test on subsequences.
    (c) Unpredictability.
    (1) It must not be feasible to predict future outputs of an RNG, 
even if the algorithm and the past sequence of outputs are known.
    (2) Unpredictability must be ensured by reseeding or by 
continuously cycling the RNG, and by providing a sufficient number of 
RNG states for the applications supported.
    (3) Re-seeding may be used where the re-seeding input is at least 
as statistically random as, and independent of, the output of the RNG 
being re-seeded.
    (d) Non-repeatability. The RNG may not be initialized to reproduce 
the same output stream that it has produced before, nor may any two 
instances of an RNG produce the same stream as each other. This 
property must be ensured by initial seeding that comes from:
    (1) A source of ``true'' randomness, such as a hardware random 
noise generator; or
    (2) A combination of timestamps, parameters unique to a Class II 
gaming system, previous RNG outputs, or other, similar method.
    (e) General requirements.
    (1) Software that calls an RNG to derive game outcome events must 
immediately use the output returned in accordance with the game rules.
    (2) The use of multiple RNGs is permitted as long as they operate 
in accordance with this section.
    (3) RNG outputs must not be arbitrarily discarded or selected.
    (4) Where a sequence of outputs is required, the whole of the 
sequence in the order generated must be used in accordance with the 
game rules.
    (5) The Class II gaming system must neither adjust the RNG process 
or game outcomes based on the history of prizes obtained in previous 
games nor use any reflexive software or secondary decision that affects 
the results shown to the player or game outcome.
    (f) Scaling algorithms and scaled numbers. An RNG that provides 
output scaled to given ranges must:
    (1) Be independent and uniform over the range;
    (2) Provide numbers scaled to the ranges required by game rules, 
and notwithstanding the requirements of paragraph (e)(3) of this 
section, may discard numbers that do not map uniformly onto the 
required range but must use the first number in sequence that does map 
correctly to the range;
    (3) Be capable of producing every possible outcome of a game 
according to its rules; and
    (4) Use an unbiased algorithm and any bias must be reported to the 
TGRA.


Sec.  547.15  What are the minimum technical standards for electronic 
data communications between system components?

    (a) Sensitive data. Communication of sensitive data must be secure 
from eavesdropping, access, tampering, intrusion or alteration 
unauthorized by the TGRA. Sensitive data includes, but is not limited 
to:
    (1) RNG seeds and outcomes;
    (2) Encryption keys, where the implementation chosen requires 
transmission of keys;
    (3) PINs;
    (4) Passwords;
    (5) Financial instrument transactions;
    (6) Transfers of funds;
    (7) Player tracking information;
    (8) Download Packages; and
    (9) Any information that affects game outcome.
    (b) Wireless communications.
    (1) Wireless access points must not be accessible to the general 
public.
    (2) Open or unsecured wireless communications are prohibited.
    (3) Wireless communications must be secured using a methodology 
that makes eavesdropping, access, tampering, intrusion or alteration 
impractical. By way of illustration, such methodologies include 
encryption, frequency hopping, and code division multiplex access (as 
in cell phone technology).
    (c) Methodologies must be used that will ensure the reliable 
transfer of data and provide a reasonable ability to detect and act 
upon any corruption of the data.
    (d) Class II gaming systems must record detectable, unauthorized 
access or intrusion attempts.
    (e) Remote communications must only be allowed if authorized by the 
TGRA. Class II gaming systems must have the ability to enable or 
disable remote access, and the default state must be set to disabled.
    (f) Failure of data communications must not affect the integrity of 
critical memory.
    (g) The Class II gaming system must log the establishment, loss, 
and re-establishment of data communications between sensitive Class II 
gaming system components.


Sec.  547.16  What are the minimum standards for game artwork, glass, 
and rules?

    (a) Rules, instructions, and prize schedules, generally. The 
following must at all times be displayed or made readily available to 
the player upon request:
    (1) Game name, rules, and options such as the purchase or wager 
amount stated clearly and unambiguously;
    (2) Denomination;
    (3) Instructions for play on, and use of, the player interface, 
including the functions of all buttons; and
    (4) A prize schedule or other explanation, sufficient to allow a 
player to determine the correctness of all prizes awarded, including;
    (i) The range and values obtainable for any variable prize;
    (ii) Whether the value of a prize depends on the purchase or wager 
amount; and
    (iii) The means of division of any pari-mutuel prizes; but
    (iv) For Class II Gaming Systems, the prize schedule or other 
explanation need not state that subsets of winning patterns are not 
awarded as additional prizes (for example, five in a row does not also 
pay three in a row or four in a row), unless there are exceptions, 
which must be clearly stated.
    (b) Disclaimers. The Player Interface must continually display:
    (1) ``Malfunctions void all prizes and plays'' or equivalent; and
    (2) ``Actual Prizes Determined by Bingo [or other applicable Class 
II game] Play. Other Displays for Entertainment Only'' or equivalent.
    (c) Odds notification. If the odds of winning any advertised top 
prize exceeds 100 million to one, the Player Interface must display 
``Odds of winning the advertised top prize exceeds 100 million to one'' 
or equivalent.


Sec.  547.17  How does a TGRA apply to implement an alternate standard 
to those required by this part?

    (a) TGRA approval.
    (1) A TGRA may approve an alternate standard from those required by 
this part if it has determined that the

[[Page 32481]]

alternate standard will achieve a level of security and integrity 
sufficient to accomplish the purpose of the standard it is to replace.
    (2) For each enumerated standard for which the TGRA approves an 
alternate standard, it must submit to the Chair within 30 days, a 
detailed report, which must include the following:
    (i) An explanation of how the alternate standard achieves a level 
of security and integrity sufficient to accomplish the purpose of the 
standard it is to replace; and
    (ii) The alternate standard as approved and the record on which the 
approval is based.
    (3) In the event that the TGRA or the tribe's government chooses to 
submit an alternate standard request directly to the Chair for joint 
government to government review, the TGRA or tribal government may do 
so without the approval requirement set forth in paragraph (a)(1) of 
this section.
    (b) Chair Review.
    (1) The Chair may approve or object to an alternate standard 
granted by a TGRA.
    (2) Any objection by the Chair must be in written form with an 
explanation why the alternate standard as approved by the TGRA does not 
provide a level of security or integrity sufficient to accomplish the 
purpose of the standard it is to replace.
    (3) If the Chair fails to approve or object in writing within 60 
days after the date of receipt of a complete submission, the alternate 
standard is considered approved by the Chair. The Chair may, upon 
notification to the TGRA, extend this deadline an additional 60 days.
    (4) No alternate standard may be implemented until it has been 
approved by the TGRA pursuant to paragraph (a)(1) of this section or 
the Chair has approved pursuant to paragraph (b)(1) of this section.
    (c) Appeal of Chair decision. A Chair's decision may be appealed 
pursuant to 25 CFR subchapter H.

    Dated this 22nd of May 2012.
Tracie L. Stevens,
Chairwoman.
Steffani A. Cochran,
Vice-Chairwoman.
Daniel J. Little,
Commissioner.
[FR Doc. 2012-12992 Filed 5-31-12; 8:45 am]
BILLING CODE 7565-01-P