The governor of Virginia has signed a bill into law that permits fantasy sports websites to operate in the state provided they follow certain guidelines.
The bill’s passage is a victory for fantasy sports operators, who are under fire for allegedly violating anti-gambling regulations in other states.
The statute, which passed both houses of the state’s legislature with strong support, will “empower Virginia to regulate this emerging industry and keep consumers safe from abuses,” said Brian Coy, the communications director for Gov. Terry McAuliffe.
The law sets in place consumer protections and guidelines for fantasy operators, which are required to register annually with the state’s Department of Agriculture and Consumer Services.
If operators follow the rules, the bill stipulates that fantasy contests do not constitute illegal gambling.
DraftKings, a major fantasy sports site, welcomed the news.
“We thank Gov. McAuliffe for his leadership and advocacy and are hopeful that other states across the country will follow Virginia’s lead,” said Griffin Finan, director of public affairs for DraftKings.
Fantasy sports are explicitly allowed under a federal law which prohibits most forms of online gambling. But each state also has its own gambling laws.
In October, Nevada regulators called the games gambling and said operators need to be licensed.
New York Attorney General Eric Schneiderman issued cease and desist orders to DraftKings and rival site FanDuel in November, saying “daily fantasy sports are creating the same public health and economic concerns as other forms of gambling.”
In January, Texas Attorney General Ken Paxton issued an opinion that fantasy sports sites violate the state law prohibiting gambling.