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Please see http://docs.legis.wisconsin.gov for the production version.
LRB-4239/1
TJD:kjf
2017 - 2018 LEGISLATURE
October 9, 2017 - Introduced by Senators Feyen and Hansen, cosponsored by
Representatives Vorpagel, Mason, Brostoff, Anderson, Kuglitsch,
Genrich, Fields, Berceau, Tauchen, Gannon and Krug. Referred to
Committee on Revenue, Financial Institutions and Rural Issues.
SB436,1,3 1An Act to amend 945.01 (1) (b); and to create chapter 570 of the statutes;
2relating to: registration of fantasy contest operators, requiring the exercise of
3rule-making authority, and providing a penalty.
Analysis by the Legislative Reference Bureau
This bill requires fantasy contest operators to register with the Department of
Financial Institutions to operate in this state and imposes certain requirements on
fantasy contest operators as specified in the bill. “Fantasy contest" is defined in the
bill as being a fantasy or simulation game or contest in which one or more players
compete against each other and a winning outcome reflects the relative knowledge
and skill of fantasy contest players and is determined predominantly by
accumulated statistical results of the performance of individuals, including athletes
in the case of sporting events. To obtain an initial registration, a fantasy contest
operator must become authorized to transact business in this state, apply to DFI and
submit evidence that the fantasy contest operator complies or will comply with
requirements specified in the bill, and pay the initial registration fee. The fantasy
contest operator must renew this registration annually.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB436,1
1Section 1. Chapter 570 of the statutes is created to read:
SB436,2,32 Chapter 570
3 Fantasy Contests
SB436,2,4 4570.01 Definitions. In this chapter:
SB436,2,7 5(1) “Confidential information" means information related to the playing of a
6fantasy contest by a fantasy contest player that is obtained because of a person's
7employment with or work as an agent for a fantasy contest operator.
SB436,2,8 8(2) “Department" means the department of financial institutions.
SB436,2,11 9(3) “Entry fee” means cash or cash equivalent that is required to be paid by a
10fantasy contest player to a fantasy contest operator in order to participate in a
11fantasy contest.
SB436,2,16 12(4) “Fantasy contest" means a fantasy or simulation game or contest in which
13one or more players compete against each other and a winning outcome reflects the
14relative knowledge and skill of fantasy contest players and is determined
15predominantly by accumulated statistical results of the performance of individuals,
16including athletes in the case of sporting events.
SB436,2,18 17(5) “Fantasy contest operator" means a person that offers to the general public
18a fantasy contest with an entry fee for a cash prize.
SB436,2,20 19(6) “Fantasy contest player" means a person who participates in a fantasy
20contest offered by a fantasy contest operator.
SB436,2,25 21(7) “Location percentage” means, for each fantasy contest, the percentage,
22rounded to the nearest one-tenth of 1 percent, of the total entry fees collected from
23fantasy contest players located in this state at the time of entry into a fantasy contest,
24divided by the total entry fees collected from all players in fantasy contests
25regardless of location.
SB436,3,4
1(8) “Net revenue” means for each fantasy contest, the amount equal to the total
2entry fees collected from all participants entering fantasy sports contests less the
3winnings paid to fantasy contest players in the fantasy contests with that result
4multiplied by the location percentage.
SB436,3,7 5570.05 Fantasy contest operator registration. (1) Registration required.
6No fantasy contest operator may offer fantasy contests in this state without first
7registering with the department.
SB436,3,9 8(2) Initial registration application. (a) In order to obtain initial registration
9from the department, a fantasy contest operator shall do all of the following:
SB436,3,1010 1. Become authorized to transact business in this state.
SB436,3,1211 2. Apply to the department on forms required by and in the manner authorized
12by the department.
SB436,3,1413 3. Submit evidence that the fantasy contest operator complies or will comply
14with s. 570.20.
SB436,3,1815 4. Pay to the department the initial registration fee of 3 percent of the net
16revenue earned by the fantasy contest operator in the previous year but not to exceed
17$10,000 or, if the fantasy contest operator did not earn net revenue in the previous
18year, $500.
SB436,3,2319 (b) The department shall issue a registration to an applicant that complies with
20this subsection and other requirements in this chapter. The department shall issue
21to a fantasy contest operator a registration under this subsection within 60 days of
22receipt of the application or shall provide justification to the fantasy contest operator
23for denying the registration.
SB436,4,4 24(3) Renewal registration; operation pending renewal. (a) To continue
25offering fantasy contests, a fantasy contest operator shall renew its registration

1annually in the manner required by the department and shall pay an annual renewal
2of registration fee of 3 percent of the net revenue earned by the fantasy contest
3operator during the previous registration period. The department may not refund
4any annual renewal registration fee.
SB436,4,95 (b) A fantasy contest operator that applies for renewal of registration may
6continue to offer fantasy contests in this state while the renewal is pending unless
7the department has reasonable cause to believe that the fantasy contest operator is
8in violation of this chapter and requires the fantasy contest operator to suspend
9fantasy contests until renewal is granted.
SB436,4,1310 (c) The department shall require a fantasy contest operator that has allowed
11its registration to lapse to resubmit an initial registration application under sub. (2),
12unless the department grants a written request by the fantasy contest operator for
13an extension to submit a renewal application.
SB436,4,17 14(4) Transfer of registration. A fantasy contest operator may transfer
15registration under this section upon a change in ownership. A fantasy contest
16operator shall report to the department a change in ownership within 20 days of the
17change.
SB436,4,20 18570.10 Departmental powers and duties. (1) Required rule making.
19Except as provided in sub. (2), the department shall promulgate rules to implement
20this chapter, including rules to do all of the following:
SB436,4,2121 (a) Administer this chapter.
SB436,4,2322 (b) Protect the best interests of fantasy contest players and prevent practices
23that are detrimental to the public interest.
SB436,4,2524 (c) Allow for review of the registration applications for fantasy contest
25operators.
SB436,5,1
1(d) Impose penalties for noncriminal violations of this chapter.
SB436,5,3 2(2) Prohibited rule making. The department may not promulgate rules to limit
3or regulate any of the following:
SB436,5,54 (a) The fantasy contest operator's rules of the administration of the individual
5fantasy contests.
SB436,5,66 (b) The statistical makeup of the contest.
SB436,5,77 (c) The digital platform used by a fantasy contest operator.
SB436,5,11 8570.20 Fantasy contest operator requirements. (1) As a condition of
9obtaining registration from the department, a fantasy contest operator shall
10implement commercially reasonable procedures that are intended to do all of the
11following:
SB436,5,1412 (a) Prevent employees of or relatives living in the same household as an
13employee of a fantasy contest operator from competing in a fantasy contest in which
14the fantasy contest operator offers a cash prize to the general public.
SB436,5,1615 (b) Prohibit the fantasy contest operator from participating in any fantasy
16contest that he or she offers.
SB436,5,1917 (c) Prevent the employees or agents of the fantasy contest operator from
18sharing confidential information with 3rd parties that could affect fantasy contest
19play until the information is made publicly available.
SB436,5,2320 (d) Ensure that no winning outcome of a fantasy contest is based on the score,
21point spread, or any performance of any single actual sports team or combination of
22sports teams or solely on a single performance of an individual athlete or participant
23in any single actual sporting event.
SB436,5,2424 (e) Prohibit all of the following persons from participating in a fantasy contest:
SB436,6,3
11. Athletes or individuals who participate or officiate in a game or competition
2that is the subject of a fantasy contest based on the sport or competition in which the
3athletes or individuals participate or are otherwise associated.
SB436,6,54 2. Any sports agent, team employee, referee, or league official associated with
5a sport or athletic event or competition on which a fantasy contest is based.
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