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H.F. No. 2540 - Fantasy Sports Game Definition and Authorization (The Third Engrossment)
Author: Senator Sandra L. Pappas
Prepared By: Stephanie James, Senate Counsel (651/296-0103)
Date: May 6, 2016


Section 1 [Consumer Protection; Fantasy Sports] establishes registration requirements for fantasy game operators who offer games with an entry fee.

Subdivision 1 [Fantasy game operation requirements] requires game operators who offer a fantasy game to a person located in the state with an entry fee to implement commercially reasonable procedures to:

·         prevent employees of the game operator and certain relatives of employees from competing in             a           game that requires an entry fee and awards a cash prize over $5;

·         prevent sharing of gaming information that could affect fantasy game play;

·         prevent a game operator employee from participating in a fantasy game;

·         verify that a player in a fantasy game with an entry is at least 18 years old;

·         verify that participants are 18 years old;

·         prohibit a person who participates in a game or contest as an individual, part of a team, or                                   official, from participating in a fantasy game that is determined by the accumulated statistical                             results of the game or contest;

·         make information available about resources for compulsive behavior;

·         provide ways for a person to restrict their own ability to enter a fantasy game;

·         disclose the number of entries in a single fantasy game that a person may submit and prevent                             players from submitting more than the allowable number;

·         segregate player funds from operational funds; maintain a reserve of a specified amount;

·         offer access to a player’s play history;

·         offer access to account details;

·         prevent a person from using a proxy server to enter the game’s operator’s platform;

·         prominently publish rules governing each fantasy game;

·         prohibit use of third-party scripts; prohibit a person found to be using such a script from                                     playing in a fantasy game for a year or more;

·         develop and prominently publish procedures for a person to file a complaint with a game                                   operator; and

·         disclose the terms of promotional offers at the time such offers are advertised, and provide full                            disclosure of limitations of the offer before a person provides financial consideration in                                      exchange for the offer.

Subdivision  2 [Definitions] defines the terms “game operator,” “fantasy game,” and “entry fee” by cross-reference to a section in the Public Safety chapter.  Defines “script.”                                                                  

Subdivision  3 [Audits] requires game operators to contract annually with third parties for audits performed according to specified standards.  Requires the audit to be submitted to the commissioner of public safety.

Section 2 [Recovery of Money Lost] precludes recovery of money lost on betting on fantasy sports through a civil lawsuit.

Section 3 [Commitments for Gambling Debt Void] specifies that gambling debts relating to fantasy sports are not void under a statute that voids certain gambling debts.

Section 4 [Fantasy Games] specifies that participating in or operating a fantasy game is not a crime. 

Paragraph (a) defines the terms “entry fee,” “fantasy game,” and “game operator.” A “fantasy game” is a fantasy sports game if certain conditions are met, as follows:

·         the value of prizes and awards are disclosed in advance;

·         the operator of the game makes known the value of prizes before the game;

·         results are determined by accumulated statistical results of individuals’ performance; and

·         the outcome is not based on the score, point spread, or performance of a single team or                                       combination of teams or solely on a single performance of an individual athlete or player in a                             single event;

·         the result of a fantasy game is not based on any athlete participating on a team sponsored by a                            secondary or postsecondary school.

Paragraph (b) exempts a fantasy game conducted by a registered game operator from laws that make certain activity a crime.

Paragraph (c) specifies that laws prohibiting certain activity do not prohibit a registered game operator from offering a fantasy game.


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