Tourism minister, John Penrose, has this week written to trade bodies, including the Association of Licensed Multiple Retailers (ALMR), asking for their initial views on the review within the next week.
The review, being run in partnership with the Gambling Commission, is due to take 18 months. It will also include a full 12-week public consultation from next July.
The government is expecting to lay draft regulations on the proposals in March 2013.
Kate Nicholls, ALMR strategic affairs director, said: “This review should give pub and bar operators an opportunity to tell government what has happened to gaming machine incomes since the last review and the impact of increased competition on the high street betting.
“The introduction of FOBT (fixed odds betting terminal) machines resulted in a stark decline in pub machine takings and we know that the major high street bookmakers, casinos and bingo operators will be lobbying hard for a more favourable deal.
“Pubs are regulated far more heavily than other gambling outlets, but offer far fewer gaming machines. The review is an opportunity to redress the balance and ensure the sector is not, once again, left behind.”
In June 2009, the maximum stake on category C, AWP (fruit) machines in pubs was increased to £1, while the maximum prize rose to £70. However, in bookmakers and casinos the maximum prize is currently £500 for gaming machines.
Nicholls added: “Operators will be looking for the playing field to be more level in this area to help make pubs more competitive on gaming.
“We see no reason why the maximum prize stake can be increased further for category C machines as well as a reconsideration of the number of machines automatically allowed under an alcohol licence.”