The Gibraltar Regulatory Authority (GRA) was established by the Gibraltar Regulatory Act in October 2000. The GRA is the statutory body in Gibraltar responsible for regulating electronic communications. This includes telecommunications, radio communications and broadcasting transmissions. The GRA serves as both the national supervisory. Gibraltar Regulatory Authority is the body that ensures the safety and transparency of the online gambling venues across its territory. Gibraltar as the British Overseas territory abides by the same obligatory regulations that operate under the EU law.

INTRODUCTION

The passing of the Security and Accountability For Every Port Act ('the SAFE Port Act') by the US Congress on 30 September 2006 was described by the Chief Executive Officer of a major internet gaming company as a 'significant setback for our company, our customers and our industry'. The SAFE Port Act incorporated the provisions of the Unlawful Internet Gambling Enforcement Act of 2006 ('the Act') making it unlawful for gaming companies to receive monies in connection with unlawful internet gambling.

The Act is the first piece of Federal legislation in the USA that specifically targets internet gambling and suggests a more determined approach by the US Government against internet gaming operators based in jurisdictions such as Gibraltar.

The effect of the Act was immediate; £3 billion was reported to have been wiped off the value of gaming companies listed on the London Stock Exchange on the first day of trading after the passing of the Act. Following the signing of the Act by the US President on 13 October 2006, several companies suspended gambling activities by persons based in the USA. A substantial proportion of the income those companies derived from internet gaming suddenly dried up.

Although undoubtedly a blow to the internet gaming industry, the Act will not prevent the continuing growth that e-gaming companies have experienced from players in jurisdictions other than the USA. The Act has set some companies back several years but most will recover by refocusing their efforts on those other markets.

In the long term, it is expected that most jurisdictions, including the USA, will go down the path of regulation rather than prohibition. Companies operating in well regulated jurisdictions will benefit from global expansion, consolidation and growth in the industry.

GIBRALTAR – A UNIQUE JURISDICTION

Gibraltar, as a jurisdiction that licences and regulates internet gaming companies, is well poised to capitalise on that growth. It is in many ways a unique jurisdiction. Over its 300 year history, a mixed cocktail of peoples and cultures have welded into a community distinct from Britain and Spain with a modern, vibrant and adaptable economy. The diversity of the Rock, as Gibraltar is popularly described, its fiscal and legislative independence and its skills base, has produced an extraordinary economic story. The latest and probably the fastest growing chapter in this unfolding tale has been the development of international gaming and betting activities.

Gibraltar is the only UK overseas territory that is part of the EU. By virtue of the UK's Treaty of Accession to the EU, Gibraltar was excluded from certain parts of the Treaty of Rome 1957 (EC Treaty). Gibraltar does not form part of the customs territory of the EU, it is treated as a third country for the purposes of the common agricultural policy, it is excluded from the common market in agriculture and trade in agricultural products and from EU rules on value added tax and other turnover taxes, and it makes no contribution to the EU budget. For all other purposes, including the freedom to provide services, Gibraltar forms part of the EU.

Gibraltar Regulatory Authority Gambling Authority

This was recently recognised in the UK's Gambling Act 2005 which confirms that Gibraltar is part of the European Economic Area (EEA) (effectively the EU and a few additional countries) for the purposes of the new UK gaming legislation.

An example of a services provision which applies to Gibraltar is the Electronic Commerce Directive¹ which has been transposed into Gibraltar law as the Electronic Commerce Ordinance 2001. The Directive does not apply to gaming. However, this exclusion has not been incorporated in the Electronic Commerce Ordinance 2001 resulting in gaming companies being able to take advantage of the provisions of the Ordinance. It also means that customers of internet gaming companies established in Gibraltar will have the rights and protection provided by the Ordinance. These include conditions relating to commercial communications and the right to certain information concerning the conclusion of electronic contracts.

Gibraltar has competence in tax, company and trade related matters, including responsibility for gaming. The legal system is entirely common law and there is a wealth of professional and commercial expertise. Furthermore, not being an island, Gibraltar is able to work with the Spanish hinterland, thereby affording opportunities for economic interaction, which would not be open to a sea-locked territory. Not only, therefore, do millions of tourists cross from southern Spain every year, but thousands (including many engaged in the gaming sector) are employed in Gibraltar and live in the surrounding municipalities. This reciprocity also enhances the leisure and social appeal of Gibraltar. It is often an important factor when gaming, financial services or other international businesses are seeking to establish a base.

The combination of British common law, EU membership, tax competitiveness and attractive lifestyle make Gibraltar a powerful proposition.

GAMING SECTOR FLOURISHES

The international gaming sector has developed over the last 7 or 8 years with careful nurturing. The initial interest (spurred by the increase in UK betting tax in the mid 1990s) mushroomed shortly thereafter into a veritable flood of applicants seeking to establish a presence. The great majority of these applications did not prosper due to the regulatory standards Gibraltar imposed and the avowed policy objective to allow in only the best-resourced and established operators.

The result of this stringent approach applied pragmatically by Gibraltar's regulator, has been to carve out a quality and first class gaming sector. The pioneering presence of Victor Chandler and Ladbrokes has now given way to a diversified and much larger gaming sector including the likes of Casino-on-Net, Stan James, PartyGaming and 888 Holdings. Gaming companies now employ approximately 10% of the workforce in Gibraltar. We are likely to witness a continued but controlled expansion of the sector, especially in e-gaming.

NEW LEGISLATION

Regulation and transparency are key to Gibraltar's drive to consolidate itself as important jurisdiction for e-gaming companies. This led to a recognition that Gibraltar needed a modern legislative framework to replace the Gaming Ordinance which was enacted on 6 June 1958 when the possibilities of the internet as a World Wide Web could only have been the subject of dreams.

After various months of consultation between the Government of Gibraltar and the industry, the Gibraltar House of Assembly passed in December 2005 the Gambling Ordinance 2005. This new legislation is now in force and has replaced in its entirety he Gaming Ordinance.

The Gambling Ordinance 2005 builds on the pragmatic approach to regulation Gibraltar has adopted over the years. It provides a streamlined application, licensing and regulatory framework for Gibraltar's growing gaming business. In particular, it makes specific provision for the requirements of e-gaming, striking a balance between regulatory and reputational concerns and the need for the industry to respond rapidly to a highly competitive and fast moving environment.

E-gaming is described in the Gambling Ordinance 2005 as 'remote gambling'. emote gambling in turn is described to mean:

'gambling in which persons participate by means of remote communication, that is to say, communication using—

1. the internet,
2. telephones,
3. television,
4. radio or,
5. any other kind of electronic or other technology for facilitating communication;'

Specific requirements are introduced in relation to remote gambling, distinguishing these from those applicable to non-remote, domestic gaming and betting activities.

Licensing and regulatory structure

The Gambling Ordinance 2005 provides for both a Licensing Authority and a Gambling Commissioner. The duties of the Licensing Authority are essentially to grant, on such terms as appear to be appropriate, licences to applicants. Licences are personal to licence holders and are not transferable. The responsibilities of the Licensing Authority also extend to renewal of licences and indeed suspension or revocation in appropriate circumstances.

The Gambling Commissioner (established under the auspices of the Gibraltar Regulatory Authority) is responsible for ensuring that the holders of licences conduct their undertakings:

1. in accordance with the terms of their licences;
2. in accordance with any other provisions made under the Gambling Ordinance 2005 or;
3. in such a manner as to maintain the good reputation of Gibraltar.

The Gambling Commissioner is empowered (with the consent of the Minister responsible for gaming and in consultation with the Licensing Authority and industry) to draw up and publish codes of practice for the conduct of gambling undertakings by licence holders.

Both the Licensing Authority and Gambling Commissioner have a variety of powers to ensure proper enforcement of their respective duties. These include the powers to investigate and seek information in appropriate circumstances from operators.

The intention throughout has been to ensure that the regulatory balance is appropriate, given the need to maintain the good reputation of Gibraltar whilst not imposing unduly onerous obligations on licence holders.

Provisions related to remote gambling

It is an offence under the Gambling Ordinance 2005 for any person in or from within Gibraltar to provide facilities for remote gambling of any description, unless he is the holder of a remote gambling licence.

An application for a remote gambling licence is made to the Licensing Authority in the form provided for under the Gambling Ordinance 2005.

It is usual as a first step in the application process to prepare a synopsis of the proposal for the establishment of a presence in Gibraltar. A synopsis should include the following information:

1. general background to the company, its promoters and the nature of the business;
2. information on the nature of the activities that the company seeks to carry out from Gibraltar;
3. reasons why the company wishes to relocate to and operate from Gibraltar;
4. reasons why its relocation to Gibraltar would be of benefit to Gibraltar's economy;
5. details of the company's proposed presence in Gibraltar;
6. a general conclusion summing up the reasons for the application for a gaming licence.

A number of specific matters are required to be taken into account by the Licensing Authority in determining whether to grant or refuse a licence. The Licensing Authority is required to refuse a licence if:

1. it considers that it would be in the public interest to do so;
2. it is not satisfied that the applicant for the licence and, where applicable, each shareholder, director and each executive manager is a fit and proper person, or;
3. it is not satisfied as to a number of various factors with regard to character, honesty, integrity, business reputation, financial business and the business plan of the proposed operators.

The Authority will also have regard to the experience of the operator or promoters, the actual or proposed ownership and structure of the business and its technical infrastructure.

Appropriate due diligence will be undertaken. This will include ensuring that the proposed licence holder has measures and procedures in place to identify money laundering and other suspicious transactions.

Responsible gambling

Gibraltar is sensitive to the need to ensure operators avoid the undesirable excesses of gambling to the greatest extent possible. Various provisions are therefore contained in the Gambling Ordinance 2005 to require a licence holder to provide some assistance to problem gamblers that may be attracted to Gibraltar sites.

A remote gambling website operated by or on behalf of a licence holder is required to contain on the home page a direct link to the websites of at least one organisation dedicated to assisting problem gamblers. Furthermore, a licence holder is required to have systems in place to enable a person to request to be self excluded from gambling, warn persons that they should not gamble beyond their means and to discourage them from so doing.

Licence holders are required to designate a person to be responsible for formulating responsible gambling policies and to provide training for staff on the implementation of those policies. They are also required to cooperate and work with the authorities in establishing and refining techniques to identify and discourage problem gambling.

Minimum ages for gambling

There is an obligation under the Gambling Ordinance 2005 for licence holders to take all reasonable steps to prevent any person from participating in gambling activities unless that person is at least of the minimum permitted age. The minimum permitted age for remote gambling is 18 (for lotteries where there are no money prizes the minimum permitted age is 16).

A licence holder that fails to comply with this obligation commits an offence under the Gambling Ordinance 2005.

Safeguarding and integrity of equipment

An important aspect of the Gambling Ordinance 2005 is the requirement with regard to the integrity of computer equipment. The legislation requires that a licence holder shall in the year following the grant of a licence, and thereafter at such intervals as are required by the Licensing Authority, produce a certificate as to the integrity of its computer equipment. It is envisaged that after the initial accreditation, subsequent requests for certification will be made on an adhoc and periodic basis.

CONCLUSION

It is vital that the e-gaming sector should increasingly adopt the highest standards of good governance within a well-structured regulatory framework. The new legislation in Gibraltar is designed to achieve precisely that and to encourage further developments in the industry.

Clearly, there are a number of international factors which will impinge significantly on the future of e-gaming. However, there is every reason to be optimistic for sustained future growth. The International Governmental Remote Gambling Summit organised by the UK's Department of Media, Culture and Sport which took place on 31 October 2006 and the Study of Gambling Services in the Internal Market of the European Union finalised in June 2006 and which is currently being considered by the EU highlight the importance which is being given to the issues connected with gambling generally and with remote gambling in particular. The prospect of more liberalised markets, better regulation and governance will ensure a competitive and dynamic environment in which many opportunities will arise.

Footnotes

1. ^{Directive of the European Parliament and of the Council 2000/31/EC of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market (Electronic Commerce Directive) (2000) OJ L 178/1.}

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Exhibit 99.3

GAMING REGULATORY OVERVIEW

General

The ownership and operation of casino entertainment facilities are subject to pervasive regulation under the laws, rules and regulationsof each of the jurisdictions in which we operate. Gaming laws are based upon declarations of public policy designed to ensure that gaming is conducted honestly, competitively and free of criminal and corruptive elements. Since the continued growthand success of gaming is dependent upon public confidence, gaming laws protect gaming consumers and the viability and integrity of the gaming industry, including prevention of cheating and fraudulent practices. Gaming laws may also be designed toprotect and maximize state and local revenues derived through taxation and licensing fees imposed on gaming industry participants and enhance economic development and tourism. To accomplish these public policy goals, gaming laws establish proceduresto ensure that participants in the gaming industry meet certain standards of character and fitness, or suitability. In addition, gaming laws require gaming industry participants to:

Typically, regulatory environments in the jurisdictions in which we operate are established by statute and are administered by aregulatory agency or agencies with interpretive authority with respect to gaming laws and regulations and broad discretion to regulate the affairs of owners, managers, and persons/entities with financial interests in gaming operations. Among otherthings, gaming authorities in the various jurisdictions in which we operate:

Licensing and Suitability Determinations

Gibraltar Regulatory Authority Gambling Legislation

Gaming laws require us, each of our subsidiaries engaged in gaming operations, certain of our directors, officers and employees, and insome cases, our stockholders and holders of our debt securities, to obtain licenses or findings of suitability from gaming authorities. Licenses or findings of suitability typically require a determination that the applicant qualifies or issuitable. Gaming authorities have very broad discretion in determining whether an applicant qualifies for licensing or should be deemed suitable. Subject to certain administrative proceeding requirements, the gaming regulators have the authority todeny any application or limit, condition, restrict, revoke or suspend any license, registration, finding of suitability or approval, or fine any person licensed, registered or found suitable or approved, for any cause deemed reasonable by the gamingauthorities. Criteria used in determining whether to grant a license or finding of suitability, while varying between jurisdictions, generally include consideration of factors such as:

In evaluating individual applicants, gaming authorities consider the individual’s reputation for good character and criminal andfinancial history and the character of those with whom the individual associates.

Many jurisdictions limit the number oflicenses granted to operate gaming facilities within the jurisdiction, and some jurisdictions limit the number of licenses granted to any one gaming operator. For example, in Indiana, state law allows us to only hold two gaming licenses. Licensesunder gaming laws are generally not transferable unless the transfer is approved by the requisite regulatory agency. Licenses in many of the jurisdictions in which we conduct gaming operations are granted for limited durations and require renewalfrom time to time. In Iowa, our ability to continue our casino operations is subject to a referendum every eight years or at any time upon petition of the voters in the county in which we operate; the most recent referendum occurred in 2010. Our NewOrleans casino operates under a contract with the Louisiana gaming authorities which extends until 2014, with a ten-year renewal period. There can be no assurance that any of our licenses or any of the above mentioned contracts will be renewed, orwith respect to our gaming operations in Iowa, that continued gaming activity will be approved in any referendum.

Mostjurisdictions have statutory or regulatory provisions that govern the required action that must be taken in the event that a license is revoked or not renewed. For example, under Indiana law, a trustee approved by gaming authorities will assumecomplete operational control of our riverboat in the event our license is revoked or not renewed, and will be authorized to take any action necessary to sell the property if we are unable to find a suitable buyer within 180 days.

In addition to us and our direct and indirect subsidiaries engaged in gaming operations, gaming authorities may investigate anyindividual or entity having a material relationship to, or material involvement with, any of these entities to determine whether such individual is suitable or should be licensed as a business associate of a gaming licensee. Certain jurisdictionsrequire that any change in our directors or officers, including the directors or officers of our subsidiaries, must be approved by the requisite regulatory agency. Our officers, directors and certain key employees must also file applications withthe gaming authorities and may be required to be licensed, qualified or be found suitable in many jurisdictions. Gaming authorities may deny an application for licensing for any cause which they deem reasonable. Qualification and suitabilitydeterminations require submission of detailed personal and financial information followed by a thorough investigation. The burden of demonstrating suitability is on the applicant, who must pay all the costs of the investigation. Changes in licensedpositions must be reported to gaming authorities and in addition to their authority to deny an application for licensure, qualification or a finding of suitability, gaming authorities have jurisdiction to disapprove of a change in a corporateposition.

If gaming authorities were to find that an officer, director or key employee fails to qualify or is unsuitable forlicensing or unsuitable to continue having a relationship with us, we would have to sever all relationships with such person. In addition, gaming authorities may require us to terminate the employment of any person who refuses to file appropriateapplications.

Moreover, in many jurisdictions, any of our stockholders or holders of our debt securities may be required tofile an application, be investigated, and qualify or have his, her or its suitability determined. For example, under Nevada gaming laws,

each person who acquires, directly or indirectly, beneficial ownership of any voting security, or beneficial or record ownership of any non-voting security or any debt security in a publiccorporation which is registered with the Nevada Gaming Commission (the “Commission”), such as Caesars Entertainment Corporation, may be required to be found suitable if the Commission has reason to believe that his or her acquisition ofthat ownership, or his or her continued ownership in general, would be inconsistent with the declared public policy of Nevada, in the sole discretion of the Commission. Any person required by the Commission to be found suitable shall apply for afinding of suitability within 30 days after the Commission’s request that he or she should do so and, together with his or her application for suitability, deposit with the Nevada Gaming Control Board (the “Board”) a sum of moneywhich, in the sole discretion of the Board, will be adequate to pay the anticipated costs and charges incurred in the investigation and processing of that application for suitability, and deposit such additional sums as are required by the Board topay final costs and charges.

Furthermore, any person required by a gaming authority to be found suitable, who is foundunsuitable by the gaming authority, shall not be able to hold directly or indirectly the beneficial ownership of any voting security or the beneficial or record ownership of any nonvoting security or any debt security of any public corporation whichis registered with the gaming authority, such as Caesars Entertainment Corporation, beyond the time prescribed by the gaming authority. A violation of the foregoing may constitute a criminal offense. A finding of unsuitability by a particular gamingauthority impacts that person’s ability to associate or affiliate with gaming licensees in that particular jurisdiction and could impact the person’s ability to associate or affiliate with gaming licensees in other jurisdictions.

Many jurisdictions also require any person who acquires beneficial ownership of more than a certain percentage of our votingsecurities and, in some jurisdictions, our non-voting securities, typically 5%, to report the acquisition to gaming authorities, and gaming authorities may require such holders to apply for qualification or a finding of suitability. Most gamingauthorities, however, allow an “institutional investor” to apply for a waiver that allows the “institutional investor” to acquire, in most cases, up to 15% of our voting securities without applying for qualification or a findingof suitability. An “institutional investor” is generally defined as an investor acquiring and holding voting securities in the ordinary course of business as an institutional investor, and not for the purpose of causing, directly orindirectly, the election of a majority of the members of our board of directors, any change in our corporate charter, bylaws, management, policies or operations, or those of any of our gaming affiliates, or the taking of any other action whichgaming authorities find to be inconsistent with holding our voting securities for investment purposes only. An application for a waiver as an institutional investor requires the submission of detailed information about the company and its regulatoryfilings, the name of each person that beneficially owns more than 5% of the institutional investor’s voting securities or other equivalent and a certification made under oath or penalty for perjury, that the voting securities were acquired andare held for investment purposes only. Even if a waiver is granted, an institutional investor generally may not take any action inconsistent with its status when the waiver was granted without once again becoming subject to the foregoing reportingand application obligations. A change in the investment intent of an institutional investor must be reported to certain regulatory authorities immediately after its decision.

Notwithstanding, each person who acquires directly or indirectly, beneficial ownership of any voting security, or beneficial or record ownership of any nonvoting security or any debt security in ourcompany may be required to be found suitable if a gaming authority has reason to believe that such person’s acquisition of that ownership would otherwise be inconsistent with the declared policy of the jurisdiction.

Generally, any person who fails or refuses to apply for a finding of suitability or a license within the prescribed period after beingadvised it is required by gaming authorities may be denied a license or found unsuitable, as applicable. The same restrictions may also apply to a record owner if the record owner, after request, fails to identify the beneficial owner. Any personfound unsuitable or denied a license and who holds, directly or indirectly, any beneficial ownership of our securities beyond such period of time as may be prescribed by the applicable gaming authorities may be guilty of a criminal offense.Furthermore, we may be subject to disciplinary action if, after we receive notice that a person is unsuitable to be a stockholder or to have any other relationship with us or any of our subsidiaries, we:

Although many jurisdictions generally do not require the individual holders of debtsecurities such as notes to be investigated and found suitable, gaming authorities may nevertheless retain the discretion to do so for any reason, including but not limited to, a default, or where the holder of the debt instruments exercises amaterial influence over the gaming operations of the entity in question. Any holder of debt securities required to apply for a finding of suitability or otherwise qualify must generally pay all investigative fees and costs of the gaming authority inconnection with such an investigation. If the gaming authority determines that a person is unsuitable to own a debt security, we may be subject to disciplinary action, including the loss of our approvals, if without the prior approval of the gamingauthority, we:

Certain jurisdictions impose similar restrictions in connection with debt securities and retain the rightto require holders of debt securities to apply for a license or otherwise be found suitable by the gaming authority.

UnderNew Jersey gaming laws, if a holder of our debt or equity securities is required to qualify, the holder may be required to file an application for qualification or divest itself of the securities. If the holder files an application forqualification, it must place the securities in trust with an approved trustee. If the gaming regulatory authorities approve interim authorization, and while the application for plenary qualification is pending, such holder may, through the approvedtrustee, continue to exercise all rights incident to the ownership of the securities. If the gaming regulatory authorities deny interim authorization, the trust shall become operative and the trustee shall have the authority to exercise all therights incident to ownership, including the authority to dispose of the securities and the security holder shall have no right to participate in casino earnings and may only receive a return on its investment in an amount not to exceed the actualcost of the investment (as defined by New Jersey gaming laws). If the security holder obtains interim authorization but the gaming authorities later find reasonable cause to believe that the security holder may be found unqualified, the trust shallbecome operative and the trustee shall have the authority to exercise all rights incident to ownership pending a determination on such holder’s qualifications. However, during the period the securities remain in trust, the security holder maypetition the New Jersey gaming authorities to direct the trustee to dispose of the trust property and distribute proceeds of the trust to the security holder in an amount not to exceed the lower of the actual cost of the investment or the value ofthe securities on the date the trust became operative. If the security holder is ultimately found unqualified, the trustee is required to sell the securities and to distribute the proceeds of the sale to the applicant in an amount not exceeding thelower of the actual cost of the investment or the value of the securities on the date the trust became operative and to distribute the remaining proceeds to the state. If the security holder is found qualified, the trust agreement will beterminated.

Additionally, following the Reclassification, the Certificates of Incorporation of CEC and CEOC containprovisions establishing the right to redeem the securities of disqualified holders if necessary to avoid any regulatory sanctions, to prevent the loss or to secure the reinstatement of any license or franchise, or if such holder is determined by anygaming regulatory agency to be unsuitable, has an application for a license or permit denied or rejected, or has a previously issued license or permit rescinded, suspended, revoked or not renewed. The Certificates of Incorporation also containprovisions defining the redemption price and the rights of a disqualified security holder. In the event a security holder is disqualified, the New Jersey gaming authorities are empowered to propose any necessary action to protect the publicinterest, including the suspension or revocation of the licenses for the casinos we own in New Jersey.

Many jurisdictionsalso require that manufacturers and distributors of gaming equipment and suppliers of certain goods and services to gaming industry participants be licensed and require us to purchase and lease gaming equipment, supplies and services only fromlicensed suppliers.

Violations of Gaming Laws

If we or our subsidiaries violate applicable gaming laws, our gaming licenses could be limited, conditioned, suspended or revoked by gaming authorities, and we and any other persons involved could besubject to substantial fines. Further, a

supervisor or conservator can be appointed by gaming authorities to operate our gaming properties, or in some jurisdictions, take title to our gaming assets in the jurisdiction, and under certaincircumstances, earnings generated during such appointment could be forfeited to the applicable jurisdictions. Furthermore, violations of laws in one jurisdiction could result in disciplinary action in other jurisdictions. As a result, violations byus of applicable gaming laws could have a material adverse effect on our financial condition, prospects and results of operations.

Reporting and Recordkeeping Requirements

We are required periodically to submit detailed financial and operating reports and furnish any other information about us and our subsidiaries which gaming authorities may require. Under federal law, weare required to record and submit detailed reports of currency transactions involving greater than $10,000 at our casinos and Suspicious Activity Reports (“SARCs”) if the facts presented so warrant. Some jurisdictions require us tomaintain a log that records aggregate cash transactions in the amount of $3,000 or more. We are required to maintain a current stock ledger which may be examined by gaming authorities at any time. We may also be required to disclose to gamingauthorities upon request the identities of the holders of our debt or other securities. If any securities are held in trust by an agent or by a nominee, the record holder may be required to disclose the identity of the beneficial owner to gamingauthorities. Failure to make such disclosure may be grounds for finding the record holder unsuitable. In Indiana, we are required to submit a quarterly report to gaming authorities disclosing the identity of all persons holding interests of 1% orgreater in a riverboat licensee or holding company. Gaming authorities may also require certificates for our stock to bear a legend indicating that the securities are subject to specified gaming laws. In certain jurisdictions, gaming authoritieshave the power to impose additional restrictions on the holders of our securities at any time.

Review and Approval of Transactions

Substantially all material loans, leases, sales of securities and similar financing transactions by us and oursubsidiaries must be reported to, or approved by, gaming authorities. Neither we nor any of our subsidiaries may make a public offering of securities without the prior approval of certain gaming authorities if the securities or the proceedstherefrom are intended to be used to construct, acquire or finance gaming facilities in such jurisdictions, or to retire or extend obligations incurred for such purposes. Such approval, if given, does not constitute a recommendation or approval ofthe investment merits of the securities subject to the offering. Changes in control through merger, consolidation, stock or asset acquisitions, management or consulting agreements, or otherwise, require prior approval of gaming authorities incertain jurisdictions. Entities seeking to acquire control of us or one of our subsidiaries must satisfy gaming authorities with respect to a variety of stringent standards prior to assuming control. Gaming authorities may also require controllingstockholders, officers, directors and other persons having a material relationship or involvement with the entity proposing to acquire control, to be investigated and licensed as part of the approval process relating to the transaction.

Certain gaming laws and regulations in jurisdictions we operate in establish that certain corporate acquisitions opposed by management,repurchases of voting securities and corporate defense tactics affecting us or our subsidiaries may be injurious to stable and productive corporate gaming, and as a result, prior approval may be required before we may make exceptional repurchases ofvoting securities (such as repurchases which treat holders differently) above the current market price and before a corporate acquisition opposed by management can be consummated. In certain jurisdictions, the gaming authorities also require priorapproval of a plan of recapitalization proposed by the board of directors of a publicly traded corporation which is registered with the gaming authority in response to a tender offer made directly to the registered corporation’s stockholdersfor the purpose of acquiring control of the registered corporation.

Because licenses under gaming laws are generally nottransferable, our ability to grant a security interest in any of our gaming assets is limited and may be subject to receipt of prior approval from gaming authorities. A pledge of the stock of a subsidiary holding a gaming license and the foreclosureof such a pledge may be ineffective without the prior approval of gaming authorities. Moreover, our subsidiaries holding gaming licenses may be unable to guarantee a security issued by an affiliated or parent company pursuant to a public offering,or pledge their assets to secure payment of the obligations evidenced by the security issued by an affiliated or parent company, without the prior approval of gaming authorities. We are subject to extensive prior approval requirements relating tocertain borrowings and security interests with respect to our New Orleans casino. If the holder of a security interest wishes operation of the casino to continue during and after the filing of a suit to enforce the security interest, it may requestthe appointment of a receiver approved by Louisiana gaming authorities, and under Louisiana gaming laws, the receiver is considered to have all our rights and obligations under our contract with Louisiana gaming authorities.

Some jurisdictions also require us to file a report with the gaming authority within a prescribed period of time following certainfinancial transactions and the offering of debt securities. Were they to deem it appropriate, certain gaming authorities reserve the right to order such transactions rescinded.

Certain jurisdictions require the implementation of a compliance review and reporting systemcreated for the purpose of monitoring activities related to our continuing qualification. These plans require periodic reports to senior management of our company and to the regulatory authorities.

Certain jurisdictions require that an independent audit committee oversee the functions of surveillance and internal audit departments atour casinos.

License Fees and Gaming Taxes

We pay substantial license fees and taxes in many jurisdictions, including the counties, cities, and any related agencies, boards, commissions, or authorities, in which our operations are conducted, inconnection with our casino gaming operations, computed in various ways depending on the type of gaming or activity involved. Depending upon the particular fee or tax involved, these fees and taxes are payable either daily, monthly, quarterly orannually. License fees and taxes are based upon such factors as:

In many jurisdictions, gaming tax rates are graduated with the effect of increasing as gross revenues increase. Furthermore, tax ratesare subject to change, sometimes with little notice, and we have recently experienced tax rate increases in a number of jurisdictions in which we operate. A live entertainment tax is also paid in certain jurisdictions by casino operations whereentertainment is furnished in connection with the selling or serving of food or refreshments or the selling of merchandise.

OperationalRequirements

In many jurisdictions, we are subject to certain requirements and restrictions on how we must conduct ourgaming operations. In many jurisdictions, we are required to give preference to local suppliers and include minority-owned and women-owned businesses in construction projects to the maximum extent practicable.

Some jurisdictions also require us to give preferences to minority-owned and women-owned businesses in the procurement of goods andservices. Some of our operations are subject to restrictions on the number of gaming positions we may have, the minimum or maximum wagers allowed by our customers, and the maximum loss a customer may incur within specified time periods.

Our land-based casino in New Orleans operates under a contract with the Louisiana Gaming Control Board and the Louisiana EconomicDevelopment and Gaming Act and related regulations. Under this authority, our New Orleans casino is subject to not only many of the foregoing operational requirements, but also to restrictions on our food and beverage operations, including withrespect to the size, location and marketing of eating establishments at our casino entertainment facility. Furthermore, with respect to the hotel tower, we are subject to restrictions on the number of rooms within the hotel, the amount of meetingspace within the hotel and how we may market and advertise the rates we charge for rooms.

In Mississippi, we are required toinclude adequate parking facilities (generally 500 spaces or more) in close proximity to our existing casino complexes, as well as infrastructure facilities, such as hotels, that will amount to at least 25% of the casino cost. The infrastructurerequirement was increased to 100% of the casino cost for any new casinos in Mississippi.

To comply with requirements of Iowagaming laws, we have entered into management agreements with Iowa West Racing Association, a non-profit organization. The Iowa Racing and Gaming Commission has issued a joint license to Iowa West Racing Association and Harveys Iowa ManagementCompany, Inc. for the operation of the Harrah’s Council Bluffs Casino, which is an excursion gambling boat that is now permanently moored, and issued a license for the Horseshoe Council Bluffs Casino at Bluffs Run Greyhound Park which is a fullservice, land based casino and a greyhound racetrack. The company operates both facilities pursuant to the management agreements.

The United Kingdom Gambling Act of 2005 which became effective in September 2007, replaced the Gaming Act 1968, and removed most of the restrictions on adverting. Though the 2005 Act controlsmarketing, advertising gambling is now controlled by the Advertising Standards Authority through a series of codes of practise. Known as the CAP codes, the codes offer guidance on the content of print, television and radio advertisements.

Indian Gaming

The terms and conditions of management contracts and the operation of casinos and all gaming on Indian land in the United States are subject to the Indian Gaming Regulatory Act of 1988, (the“IGRA”), which is administered by the National Indian Gaming Commission, (the “NIGC”), the gaming regulatory agencies of tribal governments, and Class III gaming compacts between the tribes for which we manage casinos and thestates in which those casinos are located. IGRA established three separate classes of tribal gaming-Class I, Class II and Class III. Class I includes all traditional or social games solely for prizes of minimal value played by a tribe in connectionwith celebrations or ceremonies. Class II gaming includes games such as bingo, pulltabs, punchboards, instant bingo and non-banked card games (those that are not played against the house) such as poker. Class III gaming includes casino-style gamingsuch as banked table games like blackjack, craps and roulette, and gaming machines such as slots and video poker, as well as lotteries and pari-mutuel wagering. Harrah’s Ak-Chin Phoenix and Rincon provide Class II gaming and, as limited by thetribal-state compact, Class III gaming. The Eastern Band Cherokee Casino currently provides only Class III gaming.

IGRAprohibits all forms of Class III gaming unless the tribe has entered into a written agreement or compact with the state that specifically authorizes the types of Class III gaming the tribe may offer. These compacts may address, among other things,the manner and extent to which each state will conduct background investigations and certify the suitability of the manager, its officers, directors, and key employees to conduct gaming on tribal lands. We have received our permanent certificationfrom the Arizona Department of Gaming as management contractor for the Ak-Chin Indian Community’s casino, a Tribal-State Compact Gaming Resource Supplier Finding of Suitability from the California Gambling Control Commission in connection withmanagement of the Rincon San Luiseno Band of Mission Indians casino, and have been licensed by the relevant tribal gaming authorities to manage the Ak-Chin Indian Community’s casino, the Eastern Band of Cherokee Indians’ casino and theRincon San Luiseno Band of Mission Indians’ casino, respectively.

IGRA requires NIGC approval of management contractsfor Class II and Class III gaming as well as the review of all agreements collateral to the management contracts. Management contracts which are not so approved are void. The NIGC will not approve a management contract if a director or a 10%stockholder of the management company:

In addition, the NIGC will not approve a management contract if the management company or any of its agents have attempted to unduly influence any decision or process of tribal government relating togaming, or if the management company has materially breached the terms of the management contract or the tribe’s gaming ordinance, or a trustee, exercising due diligence, would not approve such management contract. A management contract can beapproved only after the NIGC determines that the contract provides, among other things, for:

Management contracts can be modified or cancelled pursuant to an enforcement action taken by the NIGC basedon a violation of the law or an issue affecting suitability.

Indian tribes are sovereign with their own governmental systems, which have primaryregulatory authority over gaming on land within the tribes’ jurisdiction. Therefore, persons engaged in gaming activities, including the company, are subject to the provisions of tribal ordinances and regulations on gaming. These ordinances aresubject to review by the NIGC under certain standards established by IGRA. The NIGC may determine that some or all of the ordinances require amendment, and that additional requirements, including additional licensing requirements, may be imposed onus. The possession of valid licenses from the Ak-Chin Indian Community, the Eastern Band of Cherokee Indians and the Rincon San Luiseno Band of Mission Indians, are ongoing conditions of our agreements with these tribes.

Riverboat Casinos

Inaddition to all other regulations applicable to the gaming industry generally, some of our riverboat casinos are also subject to regulations applicable to vessels operating on navigable waterways, including regulations of the U.S. Coast Guard. Theserequirements set limits on the operation of the vessel, mandate that it must be operated by a minimum complement of licensed personnel, establish periodic inspections, including the physical inspection of the outside hull, and establish othermechanical and operational rules.

Racetracks

We own a full service casino which includes a full array of table games in conjunction with a greyhound racetrack in Council Bluffs, Iowa. The casino operation and the greyhound racing operation areregulated by the same state agency and are subject to the same regulatory structure established for all Iowa gaming facilities. A single operating license covers both parts of the operation in Council Bluffs. We also own slot machines at athoroughbred racetrack in Bossier City, Louisiana, and we own a combination harness racetrack and casino in southeastern Pennsylvania in which the company, through various subsidiary entities, owns a 95% interest in the entity licensed by thePennsylvania Gaming Control Board. Generally, our slot operations at the Iowa racetrack is regulated in the same manner as our other gaming operations in Iowa. In addition, regulations governing racetracks are typically administered separately fromour other gaming operations (except in Iowa), with separate licenses and license fee structures. For example, racing regulations may limit the number of days on which races may be held. In Kentucky, we own and operate Bluegrass Downs, a harnessracetrack located in Paducah, and hold a one-half interest in Turfway Park LLC, which is the owner of the Turfway Park thoroughbred racetrack in Boone County. Turfway Park LLC also owns a minority interest in Kentucky Downs LLC, which is the ownerof the Kentucky Downs racetrack. These Kentucky racetracks are licensed and regulated by the Kentucky Horse Racing Commission and are subject to the same regulatory structure established for all Kentucky racing facilities. As of July 27, 2010,we also own and operate Thistledown Racetrack, a thoroughbred racetrack located in Cleveland, Ohio, which is regulated by the Ohio State Racing Commission and subject to the same regulatory structure established for all Ohio racing facilities.

Internet

Gibraltar Regulatory Authority Gambling Commission

Anaffiliate of the Company, Caesars Interactive Entertainment, Inc., engages in lawful online internet gaming activity in the United Kingdom through two outside third party operators. This internet gaming is offeredto residents of the United Kingdom by the third party operators pursuant to licenses issued to these operators by the Gibraltar Regulatory Authority. Gibraltar is a United Kingdom “white listed” jurisdiction whichallows operators to legally advertise online gaming services in the United Kingdom. To date, the key gaming regulatory authorities governing online internet gaming are the Gibraltar Regulatory Authority, the Alderney Gambling ControlCommission and the Isle of Mann Gambling Supervision Commission. Italy and France recently legalized online internet gaming by private companies and, in June 2010, Denmark passed legislation legalizing online internet gaming. CaesarsInteractive Entertainment, Inc., recently entered into agreements with third parties for the use of the World Series of Poker brand on online gaming websites in Italy and France. We own an online gaming business, providing for real money casino,bingo, and poker games in the United Kingdom, alliances with online gaming providers in Italy and France, “play for fun” offerings in other jurisdictions, social games on Facebook and other social media websites, and mobile applicationplatforms.