Delaware becomes 14th state to legalise DFS

US state of Delaware has become the fourteenth state to legalise daily fantasy sports after state governor John Carney signed a bill formally legalising and regulating it on Wednesday.

House bill 249 passed overwhelmingly through both the Senate and House of Representatives in June, with the new legislation making Delaware among the most expensive states in the US in which to operate daily fantasy sports.

Companies wishing to operate DFS franchises in the state will have to pay an upfront fee of $50,000 together with a 15.5% tax rate on its gross revenue.

The bill also includes guidance on the likely bureaucratic destination of the new state regulator when it is introduced, and a number of consumer protections aimed at protecting the state's gamblers.

These consumer protections include promoting true and responsible gambling advertising as well as the segregation of player funds from those of the respective DFS operator. Legislation also sets a minimum age of 18 for players and bans DFS contests based on college and amateur events including horseracing. The approved law takes effect in 30 days.

This represents something of remarkable turnaround by the state following Delaware Attorney General Matt Denn publicly voicing the opinion that DFS was, and should be, illegal in the state last July.

At the time the office of the Delaware Department of Justice issued a press statement saying that: “online fantasy sports activities are not permitted under Delaware law”.

The statement was made following cease and desist letters issued to established DFS operators DraftKings, FanDuel and Yahoo DFS in which the department asked that “the companies add Delaware to their respective online lists of states in which players are not legally permitted to win monetary prizes.”

Now it seems that the tide has turned and DFS is back in favour in the state, and both DraftKings and FanDuel have already confirmed that they intend to return.

In a statement issued to Legal Sports Report after the bill signing, Tim Parilla, general counsel for DraftKings said: “DraftKings is looking forward to returning to Delaware, the fourteenth state to pass fantasy sports legislation.

"We are extremely grateful to Governor Carney and the members of the legislature for their support, especially Representative Charles Potter and Senator David Sokola, who provided tireless leadership in bringing fantasy sports back to the First State.

"Today’s bill signing continues the progress DraftKings and our industry partners are making towards our ultimate goal of passing common sense fantasy sports legislation in all 50 states.”