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Virginia Passes Daily Fantasy Sports Legislation
- February 25, 2016 By Nemanja L. -
Daily fantasy sports websites have endured some tough times in the United States of late, having been banished from quite a few states, which made them turn their attention to the UK market and start a new business in Europe.
However, they have finally received some good news as Virginia is set to become the first US state to pass a bill designed to regulate daily fantasy sports operators.
Virginia legislators approved SB 646, also known as Fantasy Contests Act, on Wednesday, meaning that said bill will become law as soon as Governor Terry McAuliffe signs it.
Virginia Leads the Way
This event marks an important milestone for the DFS operators as this is the first time a pro-DFS bill has reached an advanced stage since daily fantasy sports websites found themselves in hot water back in October.
According to the terms of the new legal framework, DFS operators are required to pay a $50,000 registration fee, while they are also tasked with ensuring that all their customers are at least 18 years old and that customer funds are held separately from the operating capital.
On top of that, all licensed DFS operators will have to submit to an annual audit performed by the Department of Agriculture and Consumer Services.
The latest legislation has finally separated fantasy sports websites from other forms of illegal gambling, although some will argue that the wording of the bill will also allow skill-based competitions linked to sporting events such as prop bets, which would make the legislation in violation of the 1992 PASPA ban on sports betting.
Meanwhile in New York
Leading DFS operators DraftKings and FanDuel have continued their legal battle in New York by submitting paperwork to the court after New York Attorney General Eric Schneiderman found that the two companies to be illegal gambling operators in November 2015.
However, New York state Senator John Bonacic introduced a new DFS bill earlier this week in an attempt to regulate the popular activity, with S 6793 expected to exempt daily fantasy sports from illegal gambling.
The new bill would establish a 15% tax on revenue made from New York residents, while operators would also be required to submit a $500,000 deposit against future tax obligations.