Mississippi Enacts Fantasy Sports Legislation

March 21, 2017

fantasy-sportsMississippi became the first state to enact fantasy sports legislation in 2017 when Governor Phil Bryant signed HB 967 into law last week.  The law is set to go into effect on July 1, 2017, though the State will start accepting applications for licensure immediately.

What are some of the key components of Mississippi’s fantasy sports law?

The requirements contained in the newly-enacted Mississippi fantasy sports legislation include many obligations imposed by similar regulatory schemes enacted across the country including, but not limited to, the following:

  • Licensure requirements, including payment of a five-thousand-dollar ($5,000) application fee for a three-year license;
  • Prevention of employees and relatives from participating in contests and sharing confidential information with third parties;
  • Requirements that operators must verify that participants are at least 18 years of age or older;
  • Restrictions on the number of entries that a single participant can submit in a given contest, dependent upon the number of total entrants in the contest;
  • Requirements to identify highly skilled players within the contest platforms;
  • Mandatory segregation of participants’ entry fee funds from operational funds;
  • Strict advertisement regulations, specifically with respect to representations involving prizes and expectations of winning prizes;
  • Prohibition against the use of scripts; and
  • Requirements that operators must contract with third parties to conduct annual audits.

Additionally, the law provides for an annual revenue tax to be levied at a rate of 8 percent of the operator’s net revenues earned in Mississippi.

Evolution of Fantasy Sports Regulations and the Ongoing Need for a Fantasy Sports Lawyer

While Mississippi may have been the first state to pass fantasy sports-related legislation this year, we do not anticipate that it will be the last to do so.  As the fantasy sports industry, and the laws and regulations that govern it, continue to grow and evolve, it is essential that fantasy sports operators maintain a watchful eye over the developing legal landscape.  To effectively navigate this rapidly changing regulatory framework, operators should work closely with knowledgeable fantasy sports lawyers to regularly review their respective contest platforms, entry fees, prize structures and marketing campaigns.

If you are interested in learning more about this topic or pursuing a fantasy sports venture, please e-mail us at info@kleinmoynihan.com, or call us at (212) 246-0900.

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David Klein

David Klein is one of the most recognized attorneys in the technology, Internet marketing, sweepstakes, and telecommunications fields. Skilled at counseling clients on a broad range of technology-related matters, David Klein has substantial experience in negotiating and drafting complex licensing, marketing and Internet agreements.
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