New Jersey DFS Update
August 25, 2017 | By Kevin Vela
New Jersey became the 16th state to enact fantasy sports legislation when Governor Chris Christie approved bill A3532 on Thursday.
The law contains standard tax and regulatory provisions. The 10.5% tax on gross revenue will generate huge profits for the state’s government, but is within the range of taxes imposed by most other states. The Division of Consumer affairs will determine the price for obtaining an operating permit, but has not yet determined the official amount. The regulatory provisions are pretty standard, although the law does not prohibit games based on college games.
Although fantasy sports were not officially legal in the state until Thursday, for years legislators have indicated that they were not illegal. Fantasy sports giants FanDuel and DraftKings noted this friendliness and set up shop in New Jersey. The state’s casinos recently joined the industry, rolling out their own platform in July. The current bill is likely designed to strike a compromise with the casino industry, as it requires operators to maintain at least one physical computer server in Atlantic City.
Overall, New Jersey residents won’t notice much change. The law goes into effect in 90 days, but operators that were already conducting DFS games in the state can continue operation throughout the permit process.
Special thanks to Vela Wood law clerk, Kristin Miller, for her assistance with this post.
About the Author(s)
Kevin Vela
Kevin is the managing partner at Vela Wood. He focuses his practice in the areas of venture financing, M&A, fund representation, and gaming law.
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