Daily fantasy sports (DFS)
could soon be legalised in New York after bills were passed with strong
support by the state Assembly and Senate late Friday night, although
the Attorney General will continue to pursue claims against leading
operators DraftKings and FanDuel.
Senator John Bonacic’s S08128 passed
with 45 votes in favour and 17 against, while Assemblyman Gary Pretlow’sA10473A was
supported by 91 Senators, with 22 voting against the bill.
While the bill now
passes to Governor Andrew Cuomo for approval, it has enough support in each
legislative house to pass into law without his signature.
Each bill sets out a
tax rate of 15 per cent of gross gaming revenue, with applicants required to
pay a registration fee determined by their revenue. Companies generating more
than $200,000 in revenue will have to pay a $100,000 fee, though this falls to
$25,000 for revenue between $100,000 and $200,000. Operators that generate
$100,000 or less will pay a $5,000 fee.
Companies will have to
file an application to operate with the New York State Gaming Commission,
renewing their licences every there years.
The passage of the
legislation will allow DFS market leaders FanDuel and DraftKings to re-enter
the New York market, one of the most lucrative states for fantasy contests in
The state has
developed into a key battleground for DFS, with Attorney General Eric
Schneiderman pursuing cases against the market leaders, accusing them of false
advertising and consumer fraud. While it had been assumed that Schneiderman
would drop his action against each company once legislation passed, the AG has
instead pledged to continue the cases.
"As I have said
from the start of my office’s investigation into daily fantasy sports, my job
is to enforce the law,” Schneiderman said in a statement once the bill passed.
Legislature has amended the law to legalize daily fantasy sports contests, a
law that will be my job to enforce and defend. We will nevertheless continue to
pursue our claims that DraftKings and FanDuel previously engaged in false advertising
and consumer fraud," he said.
Despite this, FanDuel
hailed the regulatory progress, paying tribute to a grassroots effort by DFS
players to convince legislators to legalise the game in New York.
“New York fantasy
sports fans rallied – with more than 100,000 emails and thousands of phone
calls to legislators – and legislators heard them and responded,” FanDuel chief
executive Nigel Eccles said.
“The bill represents a
thoughtful legislative process, where bi-partisanship and willingness to
compromise carried the day, and we are extremely hopeful Governor Cuomo will
sign this bill,” he continued. “We decided long ago to build FanDuel in New
York because it’s the sports capital of the world and a thriving home for tech
startups – a natural fit for fantasy sports. Our success is due in no small
part to the people, infrastructure, partnerships and opportunities here, which
very few locations in the world can offer."
“New York is the
seventh state to pass a fantasy sports bill just this year– frankly a remarkable
amount of progress in a short period of time,” Eccles continued. “It speaks to
the popularity of our game, the passion and advocacy efforts of our fans and
the immense potential states are seeing in the fantasy sports industry.”