California is first US state to progress DFS legislation

California is first US state to progress DFS legislation

Friday, January 8, 2016 Totally Gaming
California has around 12 per cent of the US's 320 million citizens

California has taken a step closer to becoming the first US state to legalise and regulate daily fantasy sports (DFS).

Bill AB 1437, which would require operators to acquire a licence to operate in the state, passed through the state's Governmental Organsation Committee nearly unanimously.

While bills related to DFS regulation have been introduced in other states, California – the country’s most populous state, with 39.1 million residents - is the first to progress such legislation, although there are still several more stages before AB 1437 becomes law.

The bill, sponsored by Assembly member Adam Gray, would require operators to pass background checks and pay an annual fee. Companies that successfully obtain a licence would also be made responsible for determining if players are eligible adults and that there is no fraud in the games.

Gray said his bill would “ensure consumers are playing on websites that provide comprehensive consumer protections”.

DFS has been promoted as ‘100 percent legal’ by market leaders such as DraftKings and FanDuel because fantasy sports are defined as games of skill by the federal 2005 Unlawful Internet Gambling Enforcement Act (UIGEA). 

However, Nevada last year ruled that DFS operators would need to apply for a gaming licence to continue offering their contests, while the attorney generals of New York and Illinois recently outlawing the sector.   

“In California, we have an opportunity to lead the way…to balance consumer protections with consumer demand for daily fantasy sports,” Gray said.

“AB 1437 will put in place safeguards to ensure games are fair, prohibit underage usage, guard against identity theft and ensure that consumers are competing on a level playing field.”

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