Local Impact Assessments Explained
In NSW registered clubs and hotel licences can (subject to an individual threshold) operate gaming machines pursuant to either gaming machine entitlements (GMEs) or, in the case of a hotel, GMEs and/or poker machine permits (PMPs). Venues have a Gaming Machine Threshold (GMT) against which they can buy or lease GMEs or PMPs from other venues.
The 2001 Gaming Machines Act (GM Act) is the principal statute in NSW that regulates the gaming industry. It is supported by the 2010 Gaming Machines Regulation.
The requirements of a GMT increase application vary. The venue may or may not be required to complete a Local Impact Assessment (LIA) when applying for a GMT increase. The circumstances vary depending on the classification of the area (SA2) where the club/hotel is located, whether the GMT increase application will be accompanied by a simultaneous GME transfer application, and if so, where the additional GMEs are being acquired from.
Where a LIA is required, then there are two different classes which must be completed in different circumstances – Class 1 and Class 2. For a Class 1 LIA to be approved, the applicant must demonstrate that the proposed increase to the GMT will provide a positive contribution to the local community, whereas a Class 2 LIA must demonstrate that the proposed increase to the GMT will have an overall positive impact on the local community.
For a hotel or club to increase its GMT it must submit a threshold increase application to Liquor and Gaming NSW. If a LIA is required, then it is also required to be lodged. The NSW Government is committed to reducing the number of GMEs or PMPs. Therefore, it is not creating any more. A licensee can buy them from another venue. In certain circumstances, a lease arrangement can be formed. Transfer applications can attract compulsory forfeitures however there is no forfeiture for the transfer of PMPs between hotels. Therefore, if you are considering purchasing any GMEs then it is imperative that you obtain sound legal advice.
Our team has extensive experience in this area and in preparing local impact assessments. If you require our assistance, then please contact our office.