C SB431 127907

User Manual: SB431

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SB431/AP

Senate Bill 431
By: Senators Hill of the 32nd and Loudermilk of the 52nd

AS PASSED

A BILL TO BE ENTITLED
AN ACT

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To amend Code Section 10-1-393, relating to unfair or deceptive practices in consumer

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transactions unlawful, so as to further define unlawful lotteries with regard to promotions;

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to amend Chapter 12 of Title 16 of the Official Code of Georgia Annotated, relating to

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offenses against public health and morals, so as to revise a definition; to provide for the

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applicability of certain provisions to certain games and devices; to revise the prohibition

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regarding certain noncash redemption items; to amend Title 48 of the Official Code of

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Georgia Annotated, relating to revenue and taxation, so as to revise definitions relating to

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coin operated amusement machines; to provide an exception from a limitation on the

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allowable number of such machines at the same location; to authorize local governments to

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adopt any combination of a list of ordinance provisions relating to bona fide coin operated

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amusement machines; to provide for related matters; to provide for an effective date and

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applicability; to repeal conflicting laws; and for other purposes.

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BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:

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SECTION 1.

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Code Section 10-1-393, relating to unfair or deceptive practices in consumer transactions

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unlawful, is amended in paragraph (16) of subsection (b) by revising subparagraph (N) and

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adding a new subparagraph to read as follows:

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"(N) Any promotion involving an element of chance which does not conform with the

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provisions of this paragraph shall be considered an unlawful lottery as defined in Code

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Section 16-12-20. Except as provided in Code Section 16-12-35 and Chapter 17 of

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Title 48, any promotion involving an element of chance which involves the playing of

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a game on a computer, mechanical device, or electronic device at a place of business

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in this state shall be considered an unlawful lottery as defined in Code Section 16-12-20

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and shall not be permitted under this chapter. Any promotion involving the playing of

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a no-skill game on a computer, mechanical device, or electronic device at a place of

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business in this state shall be considered an unlawful lottery as defined in Code
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Section 16-12-20. The administrator may seek and shall receive the assistance of the

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prosecuting attorneys of this state in the commencement and prosecution of persons

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who promote and sponsor promotions which constitute an unlawful lottery;

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(N.1) All prizes offered and awarded shall be noncash prizes only and shall not be

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redeemable for cash;".

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SECTION 2.

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Chapter 12 of Title 16 of the Official Code of Georgia Annotated, relating to offenses against

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public health and morals, is amended by revising paragraph (4) of Code Section 16-12-20,

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relating to definitions, as follows:

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"(4) 'Lottery' means any scheme or procedure whereby one or more prizes are distributed

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by chance among persons who have paid or promised consideration for a chance to win

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such prize, whether such scheme or procedure is called a pool, lottery, raffle, gift, gift

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enterprise, sale, policy game, or by some other name. Except as otherwise provided in

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Code Section 16-12-35, a lottery shall also include the payment of cash or other

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consideration or the payment for merchandise or services and the option to participate in

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or play, even if others can participate or play for free, a no skill game or to participate for

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cash, other consideration, other evidence of winnings, or other noncash prizes by lot or

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in a finite pool on a computer, mechanical device, or electronic device whereby the player

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is able to win a cash or noncash prize, other consideration, or other evidence of winnings.

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A lottery shall also include the organization of chain letter or pyramid clubs as provided

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in Code Section 16-12-38. A lottery shall not mean a:

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(A) Promotional giveaway or contest which conforms with the qualifications of a

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lawful promotion specified in paragraph (16) of subsection (b) of Code

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Section 10-1-393;

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(B) Scheme whereby a business gives away prizes to persons selected by lot if such

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prizes are made on the following conditions:

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(i) Such prizes are conducted as advertising and promotional undertakings in good

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faith solely for the purpose of advertising the goods, wares, and merchandise of such

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business; and

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(ii) No person to be eligible to receive such prize shall be required to:

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(I) Pay any tangible consideration to the operator of such business in the form of

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money or other property or thing of value;

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(II) Purchase any goods, wares, merchandise, or anything of value from such

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business; or

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(III) Be present or be asked to participate in a seminar, sales presentation, or any

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other presentation, by whatever name denominated, in order to win such prizes; or

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and

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(iii) The prizes awarded shall be noncash prizes and cannot be awarded based upon

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the playing of a game on a computer, mechanical device, or electronic device at a

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place of business in this state;

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(C) Raffle authorized under Code Section 16-12-22.1; or

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(D) National or regional promotion, contest, or sweepstakes conducted by any

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corporation or wholly owned subsidiary or valid franchise of such corporation, either

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directly or through another entity, provided that, at the time of such promotion, contest,

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or sweepstakes, such corporation:

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(i) Is registered under the federal Securities Exchange Act of 1934; and

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(ii) Has total assets of not less than $100 million.

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The provisions of this part shall not be applicable to games offered by the Georgia

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Lottery Corporation pursuant to Chapter 27 of Title 50."

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SECTION 3.

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Title 48 of the Official Code of Georgia Annotated, relating to revenue and taxation, is

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amended by revising paragraphs (2.2) and (2.3) of Code Section 48-17-1, relating to

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definitions relative to coin operated amusement machines, as follows:

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"(2.2) 'Class A machine' means a bona fide coin operated amusement machine that is not

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a Class B machine, does not allow a successful player to carry over points won on one

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play to a subsequent play or plays, and:

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(A) Provides no reward to a successful player; or

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(B) Rewards a successful player only with free replays or additional time to play;

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(C)

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certificates, or novelties in compliance with the provisions of subsection (c) or

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paragraph (1) of subsection (d) of Code Section 16-12-35, and does not reward a

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successful player with any item prohibited as a reward in subsection (i) of Code

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Section 16-12-35 or any reward redeemable as an item prohibited as a reward in

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subsection (i) of Code Section 16-12-35;

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(D) Rewards a successful player with points, tokens, tickets, or other evidence of

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winnings that may be exchanged only for items listed in subparagraph (C) of this

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paragraph; or

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(E)

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subparagraphs (B), (C), and (D) of this paragraph.

Rewards a successful player with noncash merchandise, prizes, toys, gift

Rewards a successful player with any combination of items listed in

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(2.3) 'Class B machine' means a bona fide coin operated amusement machine that

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rewards a successful player with any combination of items listed in subparagraphs

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(d)(1)(B) and (d)(1)(C) of Code Section 16-12-35 allows a successful player to accrue

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points on the machine and carry over points won on one play to a subsequent play or

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plays in accordance with paragraph (2) of subsection (d) of Code Section 16-12-35 and:

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(A) Rewards a successful player in compliance with the provisions of paragraphs (1)

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and (2) of subsection (d) of Code Section 16-12-35; and

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(B) Does not reward a successful player with any item prohibited as a reward in

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subsection (i) of Code Section 16-12-35 or any reward redeemable as an item

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prohibited as a reward in subsection (i) of Code Section 16-12-35."

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SECTION 4.
Said title is further amended by adding a new Code section to read as follows:

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"48-17-17.

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In addition to the state regulatory provisions regarding bona fide coin operated amusement

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machines contained in Code Section 16-12-35 and this chapter, the governing authority of

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any county or municipal corporation shall be authorized to enact and enforce an ordinance

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which includes any or all of the following provisions:

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(1) Prohibiting the offering to the public of more than nine Class B bona fide coin

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operated amusement machines that reward the player exclusively with noncash

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merchandise, prizes, toys, gift certificates, or novelties at the same business location;

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(2) Requiring the owner or operator of a business location which offers to the public any

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bona fide coin operated amusement machine that rewards the player exclusively as

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described in subsection (d) of Code Section 16-12-35 to inform all employees of the

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prohibitions and penalties set out in subsections (e), (f), and (g) of Code

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Section 16-12-35;

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(3) Requiring the owner or possessor of any bona fide coin operated amusement machine

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that rewards the player exclusively as described in subsection (d) of Code

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Section 16-12-35 to inform each business owner or business operator of the business

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location where such machine is located of the prohibitions and penalties set out in

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subsections (e), (f), and (g) of Code Section 16-12-35;

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(4) Providing for the suspension or revocation of a license granted by such local

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governing authority to manufacture, distribute, or sell alcoholic beverages or for the

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suspension or revocation of any other license granted by such local governing authority

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as a penalty for conviction of the business owner or business operator of a violation of

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subsection (e), (f), or (g) of Code Section 16-12-35, or both. An ordinance providing for

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the suspension or revocation of a license shall conform to the due process guidelines for
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granting, refusal, suspension, or revocation of a license for the manufacture, distribution,

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or sale of alcoholic beverages set out in subsection (b) of Code Section 3-3-2;

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(5) Providing for penalties, including fines or suspension or revocation of a license as

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provided in paragraph (4) of this subsection, or both, for a violation of any ordinance

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enacted pursuant to this subsection; provided, however, that a municipal corporation shall

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not be authorized to impose any penalty greater than the maximum penalty authorized by

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such municipal corporation's charter;

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(6) Requiring any business owner or business operator subject to paragraph (1) of

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subsection (b) of Code Section 48-17-15 to provide to the local governing authority a

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copy of each verified monthly report prepared in accordance with such Code section,

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incorporating the provisions of such Code section in the ordinance, and providing for any

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and all of the penalties authorized by subsection (d) of Code Section 48-17-15;

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(7) Requiring the business owner or business operator of any business location which

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offers to the public one or more bona fide coin operated amusement machines to post

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prominently a notice including the following or substantially similar language:

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'GEORGIA LAW PROHIBITS PAYMENT OR RECEIPT OF MONEY FOR

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WINNING A GAME OR GAMES ON THIS AMUSEMENT MACHINE; PAYMENT

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OR RECEIPT OF MONEY FOR FREE REPLAYS WON ON THIS AMUSEMENT

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MACHINE; PAYMENT OR RECEIPT OF MONEY FOR ANY MERCHANDISE,

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PRIZE, TOY, GIFT CERTIFICATE, OR NOVELTY WON ON THIS AMUSEMENT

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MACHINE; OR AWARDING ANY MERCHANDISE, PRIZE, TOY, GIFT

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CERTIFICATE, OR NOVELTY OF A VALUE EXCEEDING $5.00 FOR A SINGLE

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PLAY OF THIS MACHINE.';

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(8) Providing for restrictions relating to distance from specified structures or uses so long

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as those distance requirements are no more restrictive than such requirements applicable

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to the sale of alcoholic beverages;

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(9) Requiring as a condition for doing business in the jurisdiction disclosure by the

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business owner or business operator of the name and address of the owner of the bona

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fide coin operated amusement machine or machines;

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(10) Requiring that all bona fide coin operated amusement machines are placed and kept

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in plain view and accessible to any person who is at the business location; and

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(11) Requiring a business that offers one or more bona fide coin operated amusement

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machines to the public for play to post its business license or occupation tax certificate."

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SECTION 5.

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This Act shall become effective upon its approval by the Governor or upon its becoming law

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without such approval and shall apply to conduct that occurs on and after such date. It is not
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the intention of this Act to abate any prosecution undertaken for conduct occurring under the

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law in effect prior to such date, and any offense committed before the effective date of this

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Act shall be prosecuted and punished under the statutes in effect at the time the offense was

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committed.

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SECTION 6.
All laws and parts of laws in conflict with this Act are repealed.

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