Arizona Submits Final Sports Betting Regulations, Releases Timeline for September 9 Launch

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On July 26, 2021, the Arizona Department of Gaming (the Department) submitted its final sports betting regulations to the Secretary of State’s Office and released a definitive timeline for Arizona’s retail and online sports betting launch.

TIMELINE FOR SPORTS BETTING LAUNCH

The Department’s timeline projects retail and online sports betting will go “live” in Arizona on September 9, 2021, just in time for the start of the NFL season. The Department’s timeline also maps out key dates in the operator licensing process. As we reported previously, the Department will issue 20 Event Wagering Licenses, which will allow license holders to conduct retail and online sports betting. Of the 20 Event Wagering Licenses, 10 will be made available to the state’s 22 Indian Tribes. The remaining 10 licenses will be made available to the state’s professional sports team owners, PGA Tour facility operators and NASCAR promoters. In the event there are more qualified applicants than available licenses in either of the aforementioned categories, the Department will conduct an “allocation evaluation” to determine which applicants should receive the available licenses. The Department’s allocation decisions will take into account a number of factors, including: (i) business ability, experience and track record; (ii) demonstrated vision, willingness and commitment to make local investments in the state; and (iii) the responsiveness, approachability and involvement of local management.

The initial application period for Event Wagering Licenses will run from July 26-August 9, 2021. The Department will announce the names of qualified applicants on August 16, and to the extent there are more qualified applicants than available licenses, the Department will announce its final licensing decisions on August 27. On August 28, licensed operators may begin marketing sportsbooks; bettors may begin creating online betting accounts; and mobile betting apps may be released for public download.

FINAL SPORTS BETTING REGULATIONS

Perhaps the most anticipated provision in Arizona’s sports betting regulations relates to the number of online betting skins an Event Wagering Licensee will be permitted to operate. The final version of the provision allows a licensee to operate up to two online/mobile betting skins. Before a licensee can operate a second skin, it must petition the Department and obtain explicit approval. In deciding whether to grant a second online/mobile betting skin, the Department will consider a number of factors, including: (i) market size, scope, development and growth; (ii) the expansion of the patron base in Arizona; and (iii) the introduction of a unique brand or affiliate.

The regulations also provide clarification regarding the scope of the Supplier and Ancillary Supplier License requirements. Notably, the rules indicate the Department will issue temporary supplier licenses to qualified applicants within five days of submission of a completed application, thereby enabling suppliers to begin doing business right away, while their applications are pending.

Among other things, the regulations also establish specific wagering rules; criteria for geofencing and integrity monitoring services; internal audit procedures; and responsible advertising standards.

The full sports betting regulations are available for review on the Department’s website.

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