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Can I offer contests that involve a single game or event in Alabama? What are the requirements?

Yes, you can offer contests that involve a single game or event in Alabama. However, there are certain requirements that must be met in order to do so.

Requirements for Offering Contests that Involve a Single Game or Event in Alabama

Alabama law allows for fantasy contests, but there are certain requirements that must be met in order to offer contests that involve a single game or event. These requirements are outlined in ALCA 8-19F-4.

  1. No winning outcome is based on the score, point spread, or any performance of any single actual sports team or combination of teams or solely on any single performance of an individual athlete or participant in any single actual event.
  2. An individual who is a player in a real-world game or sporting event is restricted from participating in a fantasy contest that is determined, in whole or in part, on the accumulated statistical results of that player, the player’s real-world team, or the sport or competition for which he or she is a player.

In addition to these requirements, fantasy contest operators must also implement commercially reasonable procedures that are intended to accomplish the following:

  1. Prevent the fantasy contest operator, employees of the fantasy contest operator, and relatives living in the same household as the employees, from competing in any public fantasy contest offered by any fantasy contest operator in which the operator offers a cash prize to the general public.
  2. Prevent sharing of confidential information that could affect fantasy contest play with third parties until information is made publicly available.
  3. Verify that a fantasy contest player in a fantasy contest is 19 years of age or older.
  4. Prevent the fantasy contest operator from offering contests based on the performances of participants in high school or youth athletic events.
  5. Prevent the fantasy contest operator from offering a fantasy contest open to the general public that does not establish and make known all prizes and awards offered to winning participants in advance of the game or contest.
  6. Allow individuals to restrict themselves from entering a fantasy contest upon request and provide reasonable steps to prevent the person from entering fantasy contests offered by the fantasy contest operator.
  7. Disclose the number of entries that a fantasy contest player may submit to each fantasy contest and provide reasonable steps to prevent players from submitting more than the allowable number.
  8. Segregate fantasy contest player funds from operational funds or maintain a reserve that equals or exceeds the amount of player funds on deposit, which reserve may not be used for operational activities.
  9. Contract with a third party to annually perform an independent audit, consistent with the standards established by the American Institute of Certified Public Accountants, to ensure compliance with this chapter and shall submit the results of the audit to the regulator within 270 days of the end of the operator’s fiscal year.
  10. Not target minors or other excluded players in any advertising.

Exclusion from lottery or gift enterprise provisions

It is important to note that a fantasy contest offered pursuant to this chapter does not constitute a lottery or gift enterprise pursuant to Section 65 of the Official Recompilation of the Constitution of Alabama of 1901, as amended [1.2].

Conclusion

In summary, you can offer contests that involve a single game or event in Alabama, but you must comply with the requirements outlined in ALCA 8-19F-4. These requirements include restrictions on the types of outcomes that can be used, as well as procedures to prevent insider information and ensure fair play. Additionally, fantasy contest operators must implement procedures to prevent employees and their relatives from competing, verify player age, and disclose prize information in advance. Finally, operators must segregate player funds and contract with a third party for an annual audit.

Source(s):
Jurisdiction

Alabama