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The Legislative Service Commission staff updates the Revised Code on an ongoing basis, as it completes its act review of enacted legislation. Updates may be slower during some times of the year, depending on the volume of enacted legislation.

Chapter 3774 | Regulation of Fantasy Contests

Section 3774.01 | Definitions.

As used in this chapter:

(A) "Commission" means the Ohio casino control commission.

(B) "Entry fee" means cash or cash equivalent that a fantasy contest operator requires to be paid by a fantasy contest player to participate in a fantasy contest.

(C) "Fantasy contest" means a simulated game or contest with an entry fee that satisfies all of the following conditions:

(1) The value of all prizes and awards offered to winning fantasy contest players is established and made known to the players in advance of the contest.

(2) All winning outcomes reflect the relative knowledge and skill of the fantasy contest players and are determined predominantly by accumulated statistical results of the performance of managing rosters of athletes whose performance directly corresponds with the actual performance of athletes in professional sports competitions.

(3) Winning outcomes are not based on randomized or historical events, or on the score, point spread, or any performance of any single actual team or combination of teams or solely on any single performance of an individual athlete or player in any single actual event.

(4) The game or contest does not involve horses or horse racing.

(D) "Fantasy contest operator" means a person that offers fantasy contests with an entry fee for a prize or award to the general public. Fantasy contest operator does not include a person that offers a pool not conducted for profit as defined under division (XX) of section 2915.01 of the Revised Code.

(E) "Fantasy contest platform" means any digital or online method through which a fantasy contest operator provides access to a fantasy contest.

(F) "Fantasy contest player" means a person who participates in a fantasy contest offered by a fantasy contest operator.

(G) "Holding company" means any corporation, firm, partnership, limited partnership, limited liability company, trust, or other form of business organization not a natural person that directly or indirectly does any of the following:

(1) Has the power or right to control a fantasy contest operator;

(2) Holds an ownership interest of ten per cent or more, as determined by the commission, in a fantasy contest operator;

(3) Holds voting rights with the power to vote ten per cent or more of the outstanding voting rights of a fantasy contest operator.

(H) "Key employee" means a person, employed by a fantasy contest operator, who is responsible for ensuring, and has the authority necessary to ensure, that all requirements under this chapter and the rules adopted under this chapter and division (L) of section 3772.03 of the Revised Code are met.

(I) "Management company" means an organization retained by a fantasy contest operator to manage a fantasy contest platform and provide services such as accounting, general administration, maintenance, recruitment, and other operational services.

(J) "Material nonpublic information" means information related to the play of a fantasy contest by a fantasy contest player that is not readily available to the general public and is obtained as a result of a person's employment.

(K) "Script" means a list of commands that a fantasy-contest-related computer program can execute and that is created by a fantasy contest player, or by a third party for a fantasy contest player, to automate processes on a fantasy contest platform.

Section 3774.02 | Fantasy contest operator license.

(A) A fantasy contest operator may not offer a fantasy contest in this state without first obtaining a license from the commission.

(B)(1) In order to obtain or renew a license to operate fantasy contests in this state, a fantasy contest operator shall pay to the commission a nonrefundable license fee.

(2) Unless a license issued under this chapter is suspended, expires, or is revoked, a license may be renewed. After a determination by the commission that the licensee is in compliance with this chapter and rules adopted by the commission under this chapter or division (L) of section 3772.03 of the Revised Code, the license shall be renewed for not more than three years, as determined by commission rule adopted under this chapter or division (L) of section 3772.03 of the Revised Code.

(C) Notwithstanding division (B) of this section, the commission may investigate a licensee at any time the commission determines it is necessary to ensure that the licensee remains in compliance with this chapter and the rules adopted under this chapter or division (L) of section 3772.03 of the Revised Code. Any fantasy contest operator that applies for or holds a license under this chapter shall establish the operator's suitability for a license by clear and convincing evidence.

Section 3774.03 | Rules.

The commission shall adopt rules under Chapter 119. of the Revised Code as are necessary to complete the functions and address the subjects enumerated in division (A) of this section.

(A) The commission may adopt, and as advisable and necessary may amend or repeal, rules that include all of the following:

(1) Prohibiting fantasy contest operator's employees, relatives living in the same household as those employees, and athletes and referees in the underlying professional sports competitions from competing in any public fantasy contest offered by a fantasy contest operator or from sharing any material nonpublic information with third parties;

(2) Ensuring fantasy contest operators prohibit access to both of the following:

(a) Individuals under eighteen years of age;

(b) Individuals who, upon request, seek to restrict themselves from entering fantasy contests.

(3) Ensuring fantasy contest operators segregate fantasy contest player funds from operational funds or maintain a reserve that exceeds the amount of player funds on deposit, which reserve may not be used for operational activities. These reserve funds may take the form of cash, cash equivalents, payment processor reserves, payment processor receivables, an irrevocable letter of credit, a bond, any other method approved by the commission, or a combination thereof, in an amount that must exceed the total balances of the fantasy contest player's accounts. All reserve funds, except payment processor reserves, shall be maintained by or otherwise under the control of a licensed fantasy contest operator, unless otherwise authorized by the commission.

(4) Prescribing requirements related to beginning players and highly experienced players;

(5) Prescribing requirements for internal procedures, including at a minimum, procedures for all of the following:

(a) Complying with all applicable state and federal requirements to protect the privacy and online security of fantasy contest players and their accounts;

(b) Suspending the accounts of players who violate this chapter and the rules adopted by the commission under this chapter or division (L) of section 3772.03 of the Revised Code;

(c) Providing fantasy contest players with access to information on playing responsibly and seeking assistance for compulsive behavior;

(d) Establishing the maximum number of entries that a fantasy contest player may submit to each fantasy contest;

(e) Any other procedure that the commission determines necessary in the rules adopted under this chapter or division (L) of section 3772.03 of the Revised Code.

(6) Requiring a license application to require an applicant for a fantasy contest operator license to designate at least one key employee as a condition to obtain a license;

(7) Establishing the length of time, which shall be not more than three years, that a fantasy contest operator license and renewal license shall be valid;

(8) Establishing the fee for obtaining or renewing a license, which shall not exceed ten thousand dollars for each year of a license and a total of thirty thousand dollars for a three-year license, and which may be paid in equal installments on an annual basis over the term of the license; and

(9) Any other procedure or thing that the commission determines necessary to ensure the integrity of fantasy contests.

(B) The commission may not adopt rules to do either of the following:

(1) Limit or regulate the statistical makeup of a game or contest, or the digital platform of a fantasy contest operator ; or

(2) Require licensure of any persons other than fantasy contest operators, holding companies, or management companies.

(C) Nothing in this section prohibits the commission from adopting rules establishing consumer protections.

Section 3774.04 | Recordkeeping.

(A) Each fantasy contest operator shall retain and maintain in a place secure from theft, loss, or destruction all of the records required to be maintained by this chapter for at least five years from the date of the record's creation.

(B) Each fantasy contest operator shall retain and maintain accurate, complete, legible, and permanent records, whether in electronic or other format, of any books, records, or documents relating to the fantasy contest operator's business and accounting operations, which includes all of the following:

(1) The fantasy contest operator's business and organizational structure;

(2) Correspondence with or by, or reports to or from, the commission, or any local, state, or federal governmental agency, foreign or domestic;

(3) The fantasy contest operator's financial statements, accounting records, ledgers, and internal and external audit records;

(4) All records related to the conduct of fantasy contests by the fantasy contest operator in this state;

(5) Any materials used to advertise, publicize, or otherwise promote the fantasy contest operator's fantasy contests in this state;

(6) Any other books, records, or documents the commission requires the fantasy contest operator to retain and maintain, in rules adopted by the commission under this chapter or division (L) of section 3772.03 of the Revised Code.

(C) Each fantasy contest operator shall organize all required records in a manner that enables the commission to locate, inspect, review, and analyze the records with reasonable ease and efficiency and, upon request, provide the commission or its executive director, or duly authorized designee thereof, with the records required to be retained and maintained by this section.

Section 3774.05 | Auditing.

A fantasy contest operator offering a fantasy contest in this state shall conduct sufficient auditing as determined by the commission.

Section 3774.06 | Prohibited acts.

(A) A fantasy contest may not be offered on any kiosk or machine physically located in a retail business location.

(B) A fantasy contest operator operating in this state shall not do any of the following:

(1) Operate or offer a fantasy contest based upon any university, college, high school, or youth sporting event;

( 2) Allow the use of scripts unless the scripts are made readily available to all fantasy contest players;

( 3) Employ false, deceptive, or misleading advertising, or advertising that is not based upon fact; or

(4) Target players that have restricted themselves from entering fantasy contests under the procedures for doing so as required by the commission, or persons under eighteen years of age, in the fantasy contest operator's advertising.

Section 3774.07 | Renewal of licenses.

The commission, in an adjudication conducted under Chapter 119. of the Revised Code, may penalize, limit, condition, restrict, suspend, revoke, deny, or refuse to renew the license of any licensee or applicant. The commission may take into account any relevant aggravating or mitigating factors without in any manner limiting the authority of the commission to impose the level and type of discipline the commission considers appropriate.

Section 3774.08 | Confidential information.

(A) Any information concerning the fantasy contest operator's internal procedures, personal information, financial information, trade secret information, and information protected by the attorney-client privilege submitted, collected, or gathered in relation to an application or license under this chapter is confidential and not subject to disclosure by any state agency or political subdivision as a record under section 149.43 of the Revised Code.

(B) The commission may share the information referenced in this section with, or disclose the information to, any appropriate governmental or licensing agency if the agency that receives the information complies with the same requirements regarding confidentiality as those with which the commission must comply.

Section 3774.09 | Exemption from gambling laws.

Fantasy contests offered in accordance with this chapter and the rules adopted by the commission under this chapter or division (L) of section 3772.03 of the Revised Code are exempt from Chapter 2915. of the Revised Code.