Daily fantasy sports (DFS) operators are currently considered to have kept their positions mainly thanks to the players who choose to place their bets on real-life sports events as games of skill, rather than games of luck.
Today, the members of a state commission are expected to vote on a major report concerning the relatively new industry. Previously, they said that a classification might not matter as long as they bring money to the state. Such a classification is actually quite important to the Boston-based DFS industry leader DraftKings Inc., which has previously expressed its opinion that such a move could put its relationships with business partners at risk, increase taxes and even lead to conflicts over the company’s legal status under federal and other states’ laws.
As reported by Casino Guardian a week ago, one of the largest DFS companies – DraftKings – has turned to the gambling regulator of the state of Massachusetts, urging the latter to classify daily fantasy sports as part of online gambling. It is the local Special Commission on Online Gaming, Fantasy Sports and Daily Fantasy Sports that was entitled with the responsibility to make certain recommendations on the fate of the desired online gambling expansion in the state.
The Chief Executive Officer of the company, Jason Robins, explained in a letter sent to the commission reviewing online gambling and daily fantasy sports that the legal reasoning used as a basis of the draft report, is actually dubious. According to Mr. Robins, the conclusion that all games played for money were not legal, was impractical and absurd as long as the conclusion’s decision was concerned.
Currently, the state of Massachusetts regulates Daily Fantasy Sports under a number of customer-protection rules, suspending individuals under age 21 from betting of DFS, putting certain limits to gambling advertising, as well as prohibiting contests based on college sports. The rules were officially announced in 2016 by Attorney General Maura Healey.
Also back in 2016, the local legislature passed a temporary measure that allowed such paid sports contests to be held while the commission is working on the recommendations to give more clarity to the legal status of daily fantasy sports in Massachusetts. The commission has already used its draft report to make a suggestion to local Legislature to design and enact a law that is especially focused on DFS.
The commission’s draft report called for enacting a piece of legislation that would not only adequately regulate daily fantasy sports in the state of Massachusetts, but will also take care of the proper taxation and governance of all betting activities related to DFS. However, the state’s regulatory authority insisted on postponing any further expansion of iGaming forms for the time being, or at least until the Wynn Boston Harbor and MGM Springfield casino resorts are officially open to visitors.
DraftKings has not yet commented on its future intentions in case that the proposed recommendations are enacted in law. Still, the proposal could start another series of expensive and time-taking government talks.
According to Senator Eileen M. Donoghue, who is also head of the commission, the recommendations made were aimed at clearing the path for the local gaming industry to operate.
- Author
Daniel Williams
