Tranny Bingo is a show held every few weeks at the bar and hosted by Sydney transvestites, who use a bingo game as part of the entertainment. The most recent show was Tuesday night.

After being warned by the commission that the show was a form of lottery and needed a permit, Hopscotch sought the help of Clubs ACT, whose chief executive Jeff House has called for "a degree of discretion" over a show that was "just fundamentally a bit of fun".

The prizes offered from the bingo game, such as vouchers, were of very little value and incidental to the show, he said.

On Tuesday, prizes had been dropped to comply with gambling rules. But an issue remained on Wednesday over whether the venue can charge an entry fee.

Gambling and Racing Commission chief executive Greg Jones said if an entry fee was a pre-condition for participating in the game then this may not be appropriate because it could be considered as effectively putting up a stake on the event.

Nevertheless, bar owner Nick Parkinson decided on Wednesday to comply with the gambling laws and get a licence.

However, he said it was disappointing to see red tape tainting the capital's burgeoning evening entertainment.

"Having to to put staff members through a gaming course when we don't have any gaming machines or a TAB inside is a little ridiculous," he said.

"Bingo is just a vehicle for a stand-up comedy show. But the end of it is we have to get this gaming licence."

Mr House said the law was never meant to capture such an event, and he said the gambling commission should observe the spirit of the law as well as the letter of the law.

"People aren't turning up to gamble, they're not turning up because there are prizes, they're turning up to watch a performance," he said.

The commission's advice to Hopscotch in early February said organisations wanting to run bingo, or Housie, must have specific signs in place, staff training on the responsible service of gambling, exclusion procedures, a contact officer and harm minimisation measures.