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Minnesota Legislature

Office of the Revisor of Statutes

HF 2426

as introduced - 89th Legislature (2015 - 2016) Posted on 03/08/2016 04:25pm

KEY: stricken = removed, old language.
underscored = added, new language.
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A bill for an act
relating to consumer protection; regulation of fantasy sports; amending
Minnesota Statutes 2014, sections 297E.03, by adding a subdivision; 541.20;
541.21; 609.761, by adding a subdivision; proposing coding for new law as
Minnesota Statutes, chapter 325O.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2014, section 297E.03, is amended by adding a
subdivision to read:


new text begin Subd. 9. new text end

new text begin Fantasy sports contests. new text end

new text begin Fantasy sports contests as defined and conducted
under chapter 325O are exempt from taxation under this section.
new text end

Sec. 2.

new text begin [325O.01] DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Scope. new text end

new text begin As used in this chapter, the terms in this section have the
meanings given them.
new text end

new text begin Subd. 2. new text end

new text begin Commissioner. new text end

new text begin "Commissioner" means the commissioner of public safety
or a person to whom the commissioner has delegated functions.
new text end

new text begin Subd. 3. new text end

new text begin Fantasy sports contest. new text end

new text begin "Fantasy sports contest" means a competition
whereby a person:
new text end

new text begin (1) pays or is advanced an entry fee;
new text end

new text begin (2) selects a simulated team of players in a particular sport; and
new text end

new text begin (3) competes with that team against another team or teams, the outcome of which is
determined by the accumulated statistical results of the actual performance of athletes.
new text end

new text begin Subd. 4. new text end

new text begin Fantasy sports organization. new text end

new text begin "Fantasy sports organization" means an
entity engaged in the conduct or promotion of a fantasy sports contest, but that is not a
fantasy sports participant.
new text end

new text begin Subd. 5. new text end

new text begin Fantasy sports participant. new text end

new text begin "Fantasy sports participant" means a person
entering a fantasy sports contest.
new text end

new text begin Subd. 6. new text end

new text begin Entry fee. new text end

new text begin "Entry fee" means the amount that a fantasy sports participant
pays to a fantasy sports organization to compete in a fantasy sports contest.
new text end

new text begin Subd. 7. new text end

new text begin Payout. new text end

new text begin "Payout" means the amount of money or the fair market value
of prizes, if any, that a fantasy sports participant receives for participating in a fantasy
sports contest.
new text end

Sec. 3.

new text begin [325O.05] AUTHORIZATION.
new text end

new text begin A fantasy sports contest is not a bet or a lottery within the meaning of sections
609.75, 609.755, and 609.76 if it is conducted under this chapter.
new text end

Sec. 4.

new text begin [325O.10] REGISTRATION.
new text end

new text begin A person must not conduct, promote, or offer the play of a fantasy sports contest to a
Minnesota resident without first registering with the commissioner. The commissioner
may charge an annual registration fee to cover the costs associated with administering and
enforcing the provisions of this chapter.
new text end

Sec. 5.

new text begin [325O.20] RESTRICTIONS ON WHO MAY PARTICIPATE IN
FANTASY SPORTS.
new text end

new text begin (a) A person receiving compensation in connection with the conduct of a fantasy
sports contest must not participate as a player in a fantasy sports contest, except in
accordance with the provisions of this section.
new text end

new text begin (b) A person referenced under paragraph (a) may participate as a player in a fantasy
sports contest if the expected payout is less than twice the entry fee and total entry fees
paid by the person in a calendar year do not exceed $1,000.
new text end

new text begin (c) A person under the age of 18 must not participate in fantasy sports.
new text end

new text begin (d) A person employed by or otherwise receiving compensation or prize money from
a professional sports entity or team must not participate in a fantasy sports contest in the
sport in which the professional sports entity or team participates.
new text end

Sec. 6.

new text begin [325O.35] OVERSIGHT.
new text end

new text begin (a) The commissioner must adopt rules for fantasy sports organizations registered
with the commissioner under section 325O.10 regarding the conduct of fantasy sports,
record keeping, access to records, inspections, and reporting requirements.
new text end

new text begin (b) The commissioner must establish procedures for and must conduct an annual audit
of an organization's compliance with the provisions and rules established under this chapter.
new text end

new text begin (c) A fantasy sports organization must comply with all requests made by the
commissioner under this section.
new text end

Sec. 7.

new text begin [325O.40] RESTRICTIONS.
new text end

new text begin (a) A fantasy sports organization must not knowingly promote, offer the play of,
or advertise a fantasy sports contest on the campus of a secondary or postsecondary
educational organization located in this state.
new text end

new text begin (b) A fantasy sports organization must not offer a fantasy sports contest in which
the outcome is determined in whole or in part by the accumulated statistical results of
an athlete competing in a sporting event of a team sponsored by or associated with a
secondary or postsecondary educational organization located in this state.
new text end

new text begin (c) A fantasy sports organization must not make a loan or extend credit to a
participant in a fantasy sports contest conducted by that organization.
new text end

new text begin (d) A fantasy sports organization must not offer a fantasy sports contest in this
state if a director, officer, partner, member, governor, or a person in a supervisory or
management position has:
new text end

new text begin (1) engaged in or has a connection to an illegal business;
new text end

new text begin (2) been convicted of a felony; or
new text end

new text begin (3) been convicted of a crime involving theft, illegal gambling, or fraud.
new text end

new text begin The commissioner may conduct a review of the criminal history of a director, officer,
partner, member, governor, or a person in a supervisory or management position of a fantasy
sports organization who has registered with the commissioner under section 325O.10.
new text end

Sec. 8.

Minnesota Statutes 2014, section 541.20, is amended to read:


541.20 RECOVERY OF MONEY LOST.

Every person who, by playing at cards, dice, or other game, or by betting on the
hands or sides of such as are gambling, shall lose to any person so playing or betting
any sum of money or any goods, and pays or delivers the same, or any part thereof, to
the winner, may sue for and recover such money by a civil action, before any court
of competent jurisdiction. For purposes of this section, gambling shall not include
pari-mutuel wagering conducted under a license issued pursuant to chapter 240, purchase
or sale of tickets in the state lottery, deleted text beginordeleted text end gambling authorized under chapters 349 and 349Anew text begin,
or participation in fantasy sports contests under chapter 325O
new text end.

Sec. 9.

Minnesota Statutes 2014, section 541.21, is amended to read:


541.21 COMMITMENTS FOR GAMBLING DEBT VOID.

Every note, bill, bond, mortgage, or other security or conveyance in which the whole
or any part of the consideration shall be for any money or goods won by gambling or
playing at cards, dice, or any other game whatever, or by betting on the sides or hands
of any person gambling, or for reimbursing or repaying any money knowingly lent or
advanced at the time and place of such gambling or betting, or lent and advanced for any
gambling or betting to any persons so gambling or betting, shall be void and of no effect
as between the parties to the same, and as to all persons except such as hold or claim under
them in good faith, without notice of the illegality of the consideration of such contract or
conveyance. The provisions of this section shall not apply to:

(1) pari-mutuel wagering conducted under a license issued pursuant to chapter 240;

(2) purchase of tickets in the state lottery under chapter 349A;

(3) gaming activities conducted pursuant to the Indian Gaming Regulatory Act,
United States Code, title 25, section 2701 et seq.; deleted text beginordeleted text end

(4) lawful gambling activities permitted under chapter 349new text begin; or
new text end

new text begin (5) participation in fantasy sports contests under chapter 325Onew text end.

Sec. 10.

Minnesota Statutes 2014, section 609.761, is amended by adding a subdivision
to read:


new text begin Subd. 7. new text end

new text begin Fantasy sports contests. new text end

new text begin Sections 609.755 and 609.76 do not prohibit
a fantasy sports contest conducted under chapter 325O.
new text end