The public comment period on the regulations ended Wednesday

Virginia: major gambling operators oppose some draft sports betting rules

Once the regulations are in place, the Virginia Lottery will begin accepting applications for sports betting permits next month. Sports betting in Virginia will start online, largely through mobile apps.
2020-09-11
Reading time 2:51 min
Companies have take issue with requirements such as providing odds of winning a bet and an explanation of how those odds were calculated, the handle and payout amounts. They also criticize the process to let players voluntarily ban themselves, the ad review process, and a rule preventing betting on the Olympics. The Virginia Lottery Board is scheduled to meet next Tuesday to vote on the new rules.

Virginia state officials are setting up the rules for the legal sports betting market, which is slated to launch in early 2021.

This year, the General Assembly passed a bill authorizing the Virginia Lottery to grant between four and 12 sports betting licenses, greenlighting a type of gambling projected to generate up to $55 million in state tax revenue per year. Sports betting in Virginia will start online, largely through mobile apps. However, it could eventually expand to the brick-and-mortar casinos being planned in several cities and the Rosie’s gambling establishments operated by Colonial Downs.

The Lottery is currently working through a public review of its proposed sports betting regulations, which could determine how quickly the industry takes off in the state and what Virginia bettors will see when the apps are launched. The public comment period on the draft regulations ended Wednesday. The Virginia Lottery Board is scheduled to meet next Tuesday to vote on the new rules.

During the review process, several major sports betting operators have taken issue with some of the consumer protection measures and other rules state officials are proposing, Virginia Mercury reports. As parts of its draft regulations, state officials are developing what’s been dubbed the Sports Bettors Bill of Rights. One particularly significant rule would require sports betting platforms to provide players with information that can help them make “informed decisions about their gambling,” including the odds of winning a bet and an explanation of how those odds were calculated, the handle and payout amounts.

Major platforms like DraftKings and FanDuel have voiced strong opposition to that requirement, saying no other sports betting state in the country has imposed a similar mandate to display that information in real time. FanDuel noted that it offered 24 types of bets for a recent NBA Playoff game, with more than 300 potential outcomes and a “nearly unlimited” number of possible parlay wagers. Having to calculate and present the numbers behind each bet on the fly, the company wrote, could create major logistical challenges in terms of both screen space and processing power.

“Sports betting apps are simply not built to provide and display this type of information,” the company wrote in its formal comments on Virginia’s draft regulations. “As such, this requirement would force a re-engineering of the products, to create a demonstrably worse user experience, and all to provide information which is immaterial to the calculation of the odds and/or payout a bettor will receive.”

Several companies said the rule on showing handles seemed to be a carryover from pari-mutuel horse race wagering that doesn’t translate to other sports. Wagering on the performance of teams and athletes based on oddsmakers’ opinions of favorites and underdogs, the companies argue, is fundamentally different from more mathematically defined types of gambling like lottery tickets, dice rolls or card games.

Other controversial issues include the detailed process to let players voluntarily ban themselves from betting on sports for two years, five years or life, if they feel they’re getting addicted or losing too much money. Also, the regulations lay out strict rules for how sports betting platforms can advertise, prohibiting them from targeting minors and requiring them to submit “all advertising, marketing and promotional materials” to the Lottery for prior approval and prohibiting ads that violate “good taste.” The betting platforms said the ad review process would be overly burdensome. Several companies suggested a more lenient process in which companies would notify regulators about their advertising plans without needing a formal sign-off in advance.

In addition, there has been concerted pushback against a rule preventing betting on the Olympics, a prohibition that wasn’t included in the General Assembly’s legislation. The platforms argue that excluding certain sports defeats the purpose of the legislation.

“We will continue to monitor and consider all public comments as we prepare the final draft of the sports betting regulations,” said Lottery spokeswoman Jennifer Mullen. Once the regulations are in place, the Lottery will begin accepting applications for sports betting permits next month.

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