Virginia OKs Sports Betting Rules with Consumer Protections

Virginia OKs Sports Betting Rules with Consumer Protections
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The Virginia Lottery Commission approved sports wagering regulations Tuesday, setting in motion an aggressive timeline to have sports gambling possibly up and running by January.

The regulations are noteworthy in that they include a Sports Betting Consumer Protection Program that incorporates a Bettors' Bill of Rights.

RELATED: More on Virginia sports betting and gaming

The Virginia state legislature approved sports betting legislation in April and with Gov. Ralph Northam’s signature sports betting was legal effective July 1. The law handed the Lottery Commission the task of developing and approving regs on an accelerated schedule.

The commission said during the approval meeting that it expects to start taking application in mid-October and, with a 90-day requirement for rendering a decision on applications, that could possibly have sports betting running in Virginia in time for the Super Bowl.

Virginia is expected to hand out a total of 12 online sports gambling licenses. The tax rate is 15% before deducting the 0.25% federal excise tax.

Consumer Protections Included

Consumer protections, whether part of the Bettors' Bill of Rights or elsewhere in the regulations, not only include provisions pertaining to self-exclusions, data protection and underage gambling protections but also include provide bettors with information regarding wagers that may be unique to the sports gambling industry.

As part of the regulations and Bettors’ Bill of Rights — believed to be a first in the nation — gaming operators are required to provide for a wager “the amount wagered on the bet” and “the odds at which the wager is offered.”

That approved wording replaced previous verbiage that specified “the handle of the bet” and “pertinent information used to calculate the odds,” respectively. Input from stakeholders, including gambling operators, indicated the initial language was either inappropriate as applied to sports wagering or required incredibly complex calculations.

Number of Licenses Available

While the maximum number of Virginia online sports wagering licenses stands at 12, there are likely more licenses to be granted that will not count against the 12. Not counting against that number are potential online licenses that can be held by as many as five yet-to-be-opened casinos, according to Virginia Del. Mark Sickles, a sponsor of the sports wagering legislation.

A casino in the process of being built can apply for an online license and operate an online sportsbook before the casino itself opens, Sickles pointed out. Also not counting against the 12 online licenses are potential licenses for the NFL Washington Football Team and the MLS DC United, if the soccer team establishes corporate headquarters in Virginia.

While betting action on all major sports, including prop bets and in-game action, will be part of sportsbooks offerings in the commonwealth, there are some exclusions for amateur sports.

There will be no betting allowed on in-state college games and in-game wagering on all college sports is also prohibited. In a surprise to some, the lottery commission has also excluded betting on the Olympics, explaining that the Games should fall under the prohibition on youth sports wagering. The rationale, the commission said, was that athletes under 18 participate in the Olympics.

“That was not the intent of the youth sports provision,” Sickles said. “We may have to revisit that and see if that’s just (the regulators’) reading of the legislation.”

Self-Exclusion Addressed

For gamblers who want to curtail their own betting, self-exclusions are for periods of two years, five years and lifetime.

The exclusion is made through the lottery’s website and applies to all forms of gambling other than sports wagering in the commonwealth, including account-based lottery and, presumably, casino gaming when it’s available in Virginia. The exclusion ends automatically at the end of the exclusion period that the gambler elects.

Removed from the regulations was a provision that would have allowed gamblers to self-exclude through an operator’s platform. The exclusion information will be shared among operators with the commonwealth and an operator could extend the exclusion to other jurisdictions where the sports wagering company does business.

Permit applications will be $250,000 before the issuance of a permit with a three-year term and renewals are $200,000. Operators received relief when the definition of what executives or officials within a gaming company are to be considered a “principal” was narrowed. The applications for those permits will be $50,000 each.

Sports leagues and organizations may request that their data be used by an operator to settle wagers on an event. It’s up to operators to make their own agreements with the leagues/organizations for that data. If there is no such request from a sports league/organization, the operator may use any data source to determine a wager.

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